American Express Company (AXP)

Transaction Monitoring System

5.             (a)           Within 45 days of this Agreement, the Bank shall submit to the Department an acceptable written plan, including a timetable, for a review, enhancement and verification of the adequacy of the transaction monitoring system by a qualified, independent consultant (“Consultant”) acceptable to the Department. The plan shall also include a methodology and target date for the Consultant’s determination that the transaction monitoring system is effective.

(b)           Within 60 days of this Agreement, the Bank shall submit to the Department acceptable written customer account and transaction monitoring policies and procedures that are designed to effectively manage legal and reputational risks and ensure compliance with legal and regulatory requirements.  The acceptable policies and procedures shall take effect upon the determination by the Consultant that the improved transaction monitoring system is fully effective. Documentation to support the determination that the improved transaction monitoring system is fully effective shall be retained for subsequent supervisory review.

Transaction Monitoring System

7.             Within 90 days of this Order, AEBI shall complete the project designed to enhance the information contained in its internal customer database related to specific risk attributes of clients, to use this database as the source of customer data to determine the risk level of its clients, and to identify its high-risk accounts for its BSA/AML compliance program.

8.             (a)           Within 30 days of the board of directors’ receipt of the BSA/AML Report required by paragraph 3 of this Order, AEBI shall submit to the Reserve Bank acceptable written customer account and transaction monitoring policies and procedures that are designed to effectively manage legal and reputational risks, and ensure compliance with regulatory requirements.

(b)           Within 90 days of this Order, AEBI shall submit to the Reserve Bank an acceptable written plan, including a timetable, for the full installation, testing, and activation of an improved transaction monitoring system.  The plan shall also include a methodology and target date for determining that the transaction monitoring system is effective.

(c)           The acceptable policies and procedures submitted pursuant to paragraph 8(a) of this Order shall take effect upon the determination by a competent independent outside consultant acceptable to the Reserve Bank, or the independent BSA/AML consultant previously retained by AEBI, that the transaction monitoring system described in paragraph 8(b) of this

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Order is fully effective.  Documentation to support the determination that the new transaction monitoring system is fully effective shall be retained for subsequent supervisory review.

(d)           The interim transaction monitoring procedures adopted by AEBI in 2007 shall remain in effect until the independent outside consultant or the existing BSA/AML consultant described in paragraph 8(c), confirms, through the performance of appropriate tests, that the improved transaction monitoring system is fully effective.