Oversight of Suspicious Activity Reporting at Bank-Affiliated Broker-Dealers Ceased
GAO-01-474, Mar 22, 2001
GAO reviewed the Gramm-Leach-Bliley Act (GLBA) to determine how it might affect oversight to ensure the securities industry's compliance with anti-money laundering requirements. Specifically, GAO examined (1) how federal bank regulators were overseeing suspicious activity report (SAR) compliance for broker-dealers under their jurisdiction before and after GLBA and (2) what actions the Securities and Exchange Commission (SEC) was taking to oversee SAR compliance of broker-dealers previously monitored by bank regulators. Since the passage of GLBA, the broker-dealer subsidiaries of depository institutions and their holding companies are no longer being examined to assess their compliance with SAR requirements, and although they are being examined for compliance with reporting currency transactions and other Department of the Treasury requirements. SEC has not assumed examination responsibility for broker-dealer subsidiaries because agency officials say that they lack specific authority to examine for compliance with the SAR banking rules.