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USA PATRIOT Act Monitor News Release: Sound Practices for
4/10/2003 5:10:53 PM Eastern Daylight Time
The Federal Reserve, the Treasury Office of the Comptroller of the Currency, and the Securities and Exchange Commission have issued an Interagency Paper on Sound Practices to Strengthen the Resilience of the U.S. Financial System. (On various websites, such as the OCC's site at www.occ.treas.gov/ftp/bulletin/2003-14a.pdf.)The Sound Practices mandated by the paper are generally to be implemented by "core clearing and settlement organizations" by the end of 2004, and by "firms that play significant roles in critical financial markets" by April 2006 (three years from publication of the Interagency Paper). The Paper deals with recovery time after wide-scale disruptions, suggesting that core clearing and settlement activities should be resumed within the business day on which the disruption occurs, "but with the overall goal of achieving recovery and resumption within two hours after an event." Though geographic dispersion is recommended between primary and back-up sites, no specific mileage requirement is introduced. Testing scenarios may include industry-wide efforts to ensure that organizations can cooperate if the need arises. A detailed analysis of the Interagency Report will appear in the April 2003 issue of the USA PATRIOT Act Monitor.
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