Financial institutions (FIs) are required to cooperate with law enforcement agencies (LEAs) in their investigations of money laundering, terrorist financing, and other financial crimes. However, sometimes LEAs may submit requests for information or documents that are overly broad, unduly intrusive, or unreasonable in scope or volume. Such requests may pose challenges or risks for FIs, such as violating customer privacy, compromising data security, disrupting business operations, or incurring excessive costs.
The most appropriate response for an FI in such a situation is to narrow the request through a prompt response to the LEA. This means that the FI should communicate with the LEA as soon as possible to clarify the purpose, scope, and relevance of the request, and to negotiate a more reasonable and proportionate request that meets the LEA's needs and the FI's capabilities. The FI should also explain the potential difficulties or consequences of complying with the original request, and propose alternative or additional sources of information that may be more useful or accessible. The FI should document the communication and the agreed terms of the request, and comply with the request in a timely and accurate manner.
By narrowing the request through a prompt response, the FI can demonstrate its good faith and willingness to cooperate with the LEA, while also protecting its own interests and obligations. This can help avoid or resolve any conflicts or misunderstandings between the FI and the LEA, and facilitate a more efficient and effective investigation.
References:
Requests by Law Enforcement for Financial Institutions to Maintain Accounts EFFECTIVE SUPERVISION AND ENFORCEMENT BY AML/CFT SUPERVISORS OF THE FINANCIAL SECTOR AND LAW ENFORCEMENT Bank Secrecy Act/Anti-Money Laundering: Requests by Law Enforcement for Financial Institutions to Maintain Accounts Support of Law Enforcement ACAMS CAMS Certification Study Guide 6th Edition

The threat of US sanctions against foreign individuals and entities continues to exist despite the absence of a US nexus. This is stated in the Certified Anti-Money Laundering Specialist (the 6th edition) manual on page
591, which states: "It is important to note that the threat of US sanctions against foreign individuals and entities continues to exist even when there is no direct US nexus (i.e., no US persons or assets involved)."

According to the CDD Rule, covered financial institutions must establish and maintain written procedures that are reasonably designed to identify and verify beneficial owners of legal entity customers and to include such procedures in their anti-money laundering compliance program1. These procedures should also be updated as necessary to reflect changes in the law or the institution's risk profile2. Moreover, the institution should provide adequate training to its employees on the new requirements and monitor their compliance3.
1: FinCEN Guidance, FIN-2020-G002, August 3, 2020, p. 1
2: Your responsibilities under money laundering supervision - GOV.UK, Section: Customer due diligence requirements
3: Customer identification: Know your customer (KYC) | AUSTRAC, Section: Training and awareness

The USA PATRIOT Act is a comprehensive legislation that was enacted in 2001 to enhance the powers and tools of the US authorities to combat money laundering, terrorist financing, and other threats to the national security and the integrity of the financial system. The USA PATRIOT Act contains several provisions that affect the relationship between US banks and foreign banks that maintain correspondent accounts in the US.
One of these provisions is Section 319, which allows the US authorities to seize the funds of a foreign bank held with a US bank, if the foreign bank refuses to comply with a subpoena or a request for records related to the correspondent account. This provision is intended to prevent foreign banks from using their correspondent accounts in the US to facilitate transactions involving tainted funds, such as proceeds of crime, funds intended to support terrorism, or funds subject to sanctions or asset freezing orders. Section 319 also requires US banks to maintain records of the owners and agents of foreign banks that have correspondent accounts with them, and to terminate such accounts if requested by the US authorities.
Therefore, if a foreign bank maintains a correspondent account in the US, and the US authorities find out that the account has been used to facilitate a transaction involving tainted funds, the US authorities can seize the funds of the foreign bank held with the US bank, under the authority of the USA PATRIOT Act.
CAMS Study Guide - 6th Edition, Chapter 1, Section 1.2, page 10
USA PATRIOT Act, Section 319, page 55-57
The USA PATRIOT Act: A Legal Analysis, Section III, page 9-10
[The USA PATRI
Reference: https://www.fincen.gov/fact-sheet-section-312-usa-patriot-act-final-regulation-and-notice- proposed-rulemaking

The most appropriate step for an AML compliance officer to take upon receiving notice of government update including the names of the latest terrorists sanctioned by the United Nations Security Council is to update the monitoring software containing sanctioned persons. This is because the AML compliance officer is responsible for ensuring that the financial institution does not engage in any transactions or business relationships with individuals or entities that are subject to sanctions, as this could expose the institution to legal, regulatory, and reputational risks. By updating the monitoring software, the AML compliance officer can ensure that the institution's screening and filtering systems are up to date and can flag any potential matches or hits with the sanctioned persons. This would also enable the AML compliance officer to take appropriate actions, such as blocking or freezing funds, reporting to the relevant authorities, and conducting further due diligence, if necessary.
Anti-Money Laundering (AML) | FINRA.org, Overview.
AML Compliance Officer and Their Responsibilities - Tookitaki, Role and Responsibilities of an AML Compliance Officer.
What is an AML Compliance Officer? - Sanction Scanner, Communicate openly with the company's internal management team.
Guidance on Existing AML Program Rule Compliance ... - FinCEN.gov, Financial Institutions Toll-Free Hotline.