501.604—Reports by U.S. financial institutions on rejected funds transfers.

(a) Who must report. Any financial institution that rejects a funds transfer where the funds are not blocked under the provisions of this chapter, but where processing the transfer would nonetheless violate, or facilitate an underlying transaction that is prohibited under, other provisions contained in this chapter, must report. For purposes of this section, the term “financial institution” shall include a banking institution, depository institution or United States depository institution, domestic bank, financial institution or U.S. financial institution, as those terms are defined in the applicable part of this chapter.
(b) Rejected transfers. Examples of transactions involving rejected funds transfers include funds transfer instructions:
(1) Referencing a blocked vessel but where none of the parties or financial institutions involved in the transaction is a blocked person;
(2) Sending funds to a person in Iraq;
(3) Transferring unlicensed gifts or charitable donations from the Government of Syria to a U.S. person;
(4) Crediting Iranian accounts on the books of a U.S. financial institution; and
(5) Making unauthorized transfers from U.S. persons to Iran or the Government of Iran.
(c) When reports are due. Reports are required to be filed within 10 business days by any financial institution rejecting instructions to execute payments or transfers involving underlying transactions prohibited by the provisions of this chapter.
(d) What must be reported. The report shall include the name and address of the transferee financial institution, the date of the transfer, the amount of the payment transfer, and a photocopy of the payment or transfer instructions received, and shall state the basis for the rejection of the transfer instructions. The report shall also provide the name and telephone number of a contact person at the transferee financial institution from whom compliance information may be obtained.
(e) Where to report. Reports must be filed with the Office of Foreign Assets Control, Compliance Programs Division, U.S. Treasury Department, 1500 Pennsylvania Avenue NW.—Annex, Washington, DC 20220.

Code of Federal Regulations

[62 FR 45101, Aug. 25, 1997, as amended 70 FR 34061, June 13, 2005]