Which product type is subject to U.S. extra-jurisdictional reach over non-U.S. banks and non-U.S. persons under the USA PATRIOT Act?
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A. B. C. D.C
Under the USA PATRIOT Act, the US has extended its jurisdiction over non-US banks and non-US persons involved in Correspondent banking activities. Therefore, the correct answer is D. Correspondent banking.
Correspondent banking is a type of banking relationship in which one bank (the correspondent bank) provides services to another bank (the respondent bank), such as cash management, international wire transfers, and foreign currency exchange. Correspondent banking relationships are important for facilitating international trade and finance.
However, correspondent banking relationships can also be used to facilitate money laundering, terrorist financing, and other illicit activities. Because of this risk, the USA PATRIOT Act requires US financial institutions to conduct enhanced due diligence on their correspondent banking relationships and to monitor those relationships for suspicious activity.
In addition, the USA PATRIOT Act extends the jurisdiction of US authorities to non-US banks that maintain correspondent banking relationships with US banks. This means that US authorities can take enforcement action against non-US banks that are involved in illicit activity through their correspondent banking relationships with US banks.
Therefore, correspondent banking is subject to U.S. extra-jurisdictional reach over non-U.S. banks and non-U.S. persons under the USA PATRIOT Act.