§5364 Policies and procedures to identify and prevent restricted transactions

Summary

Within 270 days after the law takes effect, the Secretary and the Federal Reserve Board, working with the Attorney General, must write rules. The rules must require each designated payment system and everyone who uses it to set up policies and procedures to find and stop "restricted transactions." Systems can use codes in authorization messages or other ways to spot such transactions and must block ones they find. They can also stop their products or services from being used for a restricted transaction. When writing the rules, the Secretary and the Board must give examples of acceptable policies, let participants choose among different ways to comply when practical, and allow exemptions when it is not practical to block certain transactions or systems. The rules must not block transactions that fall under the exceptions in section 5362(10)(B), (C), or (D)(i). A financial transaction provider follows the rules if it relies on and follows the policies of a designated payment system of which it is a member and those policies meet the rules. Subsection (d) lists when a person identifies or blocks or refuses a transaction: if it is restricted, is reasonably believed to be restricted, or is blocked while relying on a payment system’s policies. Enforcement is handled only by the Federal functional regulators for entities they oversee under section 505(a) of the Gramm‑Leach‑Bliley Act and section 5g of the Commodities Exchange Act, and by the Federal Trade Commission for others.