FinCEN 311 refers to Section 311 of the USA PATRIOT Act, which grants the U.S. Treasury Department the authority to designate foreign jurisdictions, financial institutions, or transactions as primary money laundering concerns. Once designated, FinCEN can impose special measures, including prohibitions on certain financial activities, to protect the U.S. financial system. This tool is a significant component of the United States’ anti-money laundering and counter-terrorist financing efforts. Its application can severely restrict an entity’s access to the global financial network.
Context
Crypto news often reports on FinCEN 311 designations when they affect digital asset exchanges, mixers, or other entities perceived as facilitating illicit finance. These designations can have significant repercussions for the affected entities and the broader digital asset market, often leading to de-risking by financial institutions. Discussions frequently center on the impact of such actions on innovation versus regulatory compliance within the crypto space.
The FinCEN Section 311 designation mandates all regulated financial institutions sever correspondent and payable-through accounts with the named entity.
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