US Section 311 Special Measures: Huione and Banque Misr UAE

Section 311 of the USA PATRIOT Act lets the US Treasury cut a foreign bank, jurisdiction or class of transactions off from the US financial system once it is found to be of primary money laundering concern. It is one of the most direct tools in US AML law, and it has been used recently against the Huione Group in Cambodia and proposed against Banque Misr UAE. This guide explains the five special measures, how they are imposed, and what the recent actions mean for compliance teams. It builds on our guide to US correspondent accounts for foreign banks.

What section 311 is

According to the Federal Financial Institutions Examination Council (FFIEC) BSA/AML examination manual, section 311 added 31 USC 5318A to the Bank Secrecy Act, and the measures are implemented through orders and regulations in 31 CFR Chapter X, Part 1010, Subpart F. The statute sets a process the Secretary of the Treasury must follow, including consulting specified federal agencies, before deeming a jurisdiction, institution, class of transactions or type of account to be of primary money laundering concern. It sets similar procedures, factors and consultation requirements for choosing which measures to impose.

The five special measures

The FFIEC manual describes five measures, each aimed at a different level of intervention:

1. Recordkeeping and reporting: banks may be required to keep records, file reports, or both, on the aggregate amount of transactions or on each transaction. The information can include the identity and address of participants (including the originator of a funds transfer), the legal capacity in which each participant acts, the beneficial owner of the funds and a description of the transaction.
2. Beneficial ownership information: banks may be required to take reasonable and practicable steps to obtain and keep beneficial ownership information for accounts opened or maintained in the US by foreign persons or their representatives. The measure cannot apply to a foreign entity whose shares are publicly reporting or listed and traded on a regulated exchange or market.
3. Payable-through accounts: for a payable-through account held for a foreign financial institution, banks may be required to identify each customer and representative who can use the account or whose transactions route through it, and to obtain information on them that is substantially comparable to what the bank collects on US customers.
4. Correspondent accounts: the same identification and comparable-information requirement, applied to correspondent accounts held for a foreign financial institution.
5. Prohibitions or conditions: regulations may prohibit or set conditions on opening or maintaining certain correspondent or payable-through accounts. The manual says FinCEN may apply this measure to all financial institutions in a foreign jurisdiction or to specific institutions and their subsidiaries, require banks to review account records to find direct or indirect accounts, bar knowingly providing indirect access, require notice to correspondent account holders not to provide access, and require reasonable steps to detect indirect use.

Form and duration

According to the manual, measures one to four may be imposed by regulation, order or otherwise without prior public notice and comment, but orders must be of limited duration and issued with a notice of proposed rulemaking. Measure five may be imposed only by regulation, and unlimited-duration measures require a final rule. While an order issued with a proposal is pending, banks with covered accounts must comply with its information collection requirements.

Case study: Huione Group

FinCEN's proposal on Huione Group used special measure five. The proposal found reasonable grounds to conclude that Huione Group, a Cambodia-based group including Haowang Guarantee, Huione Pay PLC and Huione Crypto, was a financial institution operating outside the US and of primary money laundering concern. It cited stolen cryptoassets from heists attributed to North Korea (at least 37.6 million US dollars), proceeds of Southeast Asian investment scams (at least 36 million dollars), and an estimate that the group received at least 4 billion dollars in illicit proceeds between August 2021 and January 2025. It also cited weak AML and know-your-customer controls and a stablecoin advertised as unfreezable.

The final rule appeared in the Federal Register on 16 October 2025 (Volume 90, Number 198, page 48295) and took effect on 17 November 2025. It prohibits covered financial institutions from opening or maintaining a correspondent account for or on behalf of Huione Group and requires special due diligence on foreign correspondent accounts, reasonably designed to guard against them being used to process transactions involving the group. Notifying foreign correspondent account holders of the prohibition forms part of that due diligence. FinCEN's proposal described the burden as minimal, mainly adding the group to existing screening tools.

2026 proposal on successors

FinCEN has since proposed to amend the definition in 31 CFR 1010.664, with Federal Register publication scheduled for 25 June 2026. The proposal would add H-Pay Service PLC, which FinCEN assesses took over the business, staff, branches and branding of Huione Pay PLC after it lost its licence and corporate registration in 2025, and it treats that move as an attempt to evade the existing measure. It would also define a successor entity as any person that replaces Huione Group or a component by acquiring its assets or carrying out its affairs under a new name. It is a proposal only, and the existing measure stays in effect.

Case study: Banque Misr UAE (proposed)

A further FinCEN proposal, dated 28 August 2026 and scheduled for Federal Register publication on 1 September 2026, concerns Banque Misr UAE, the five United Arab Emirates branches of the Egypt-based, state-owned Banque Misr. Operations in Egypt and elsewhere are excluded. FinCEN describes the branches as a significant conduit for Iranian shadow banking, citing about 1.8 billion dollars in potential illicit flows since 2024, and proposes special measure five as the only measure adequate to the risk. Comments were due 30 days after publication.

Our suggestions for compliance teams

These are Learnsignal's suggestions, not regulator requirements. Check FinCEN's list of final special measures at each review cycle rather than relying on memory, since the FFIEC manual itself says orders and rules can be issued or rescinded. Make sure your screening can catch named entities and successors that appear in correspondent payment messages. Record how you notify foreign correspondent account holders. For related risks, see our guide to cryptoasset sanctions evasion, and for training see Learnsignal CPD.

What we could not confirm

We did not read the statute itself, so our description of the five measures follows the FFIEC manual. The Huione figures come from FinCEN's proposal, and we have not checked whether the final rule restates them. We could not confirm whether the 2026 Huione amendment or the Banque Misr UAE proposal has been finalised, or what happened after the comment periods. The FFIEC manual page we read does not list active section 311 actions, so we cannot give a complete current list.

Frequently asked questions

Which section 311 measure is the strongest?

Special measure five, which allows prohibitions or conditions on correspondent and payable-through accounts, and which the FFIEC manual describes as the strongest measure.

Can special measures one to four be imposed without notice and comment?

According to the FFIEC manual, yes, but orders must be of limited duration and issued with a notice of proposed rulemaking.

When did the Huione final rule take effect?

FinCEN's final rule took effect on 17 November 2025.