April 24, 2003
Industry Presents Comments on Patriot Act
A coalition of leading industry trade associations and manufacturers presented the U.S. Treasury Department with a document commenting on the proposed rules for compliance with the USA Patriot Act of 2001. The rules require businesses to implement anti-money laundering programs. The document represents the jewelry industry's efforts to help the U.S. government better refine programs designed to prevent the laundering of funds to finance criminal activities through jewelry businesses. The submission of the document coincides with the end of a comment period which started March 5.
Under separate federal law, many nontraditional financial entities are considered financial institutions, including "dealers in precious metals, gemstones and jewels." The new rules are expected to be finalized in the next several months.
After the Treasury Department publishes the final rules, dealers will have a period to comply. At that time, the Jewelers Vigilance Committee says it will offer a template for jewelry companies to follow to comply with the Patriot Act's programs to counter money laundering and offer customized counseling on compliance.
The jewelry industry coalition consists of JVC, Jewelers of America, Manufacturing Jewelers & Suppliers of America, American Gem Trade Association, Diamond Manufacturers and Importers of America, American Gem Society, Diamond Dealers Club of New York, Stuller Settings Inc. and Sterling Jewelers Inc.
"Since July, 2002, a coalition of leading jewelry and precious metal trade associations have been working with the Treasury Department to develop a practical and credible program of minimum standards for anti-money laundering programs in our industry," says Cecilia L. Gardner, executive director and general counsel of JVC. "Now we are submitting comprehensive comments representing all segments of the jewelry community. Our comments focus on who in our industry is covered by the rules and how to ensure that all segments remain alert to efforts to exploit our businesses."
To comply with the new proposed rules, companies that buy or sell more than $50,000 worth of precious metals or precious gemstones in a calendar year must develop and implement anti-money laundering programs reasonably designed to prevent efforts to use jewelry transactions for criminal purposes. "This year, covered firms will be required to develop written internal policies and procedures, designate compliance officers, train employees and institute independent audit functions to test the programs," Gardner said. The comments present to the Treasury Department can be found on the Late Breaking News section of JVC's Web site.