Time and time again, I have heard the same speech from compliance officers in Europe and the Middle East; we are outside the United States, and therefore, US AML and counter-terrorism laws and regulations are not applicable to us, as the US has no jurisdiction.

Whilst legally speaking, they may be correct, you must accept that somber fact that, so long as your bank mantains a subsidiary, branch, agency or representative office inside the United States, its regulators have the ability to discipline, or even terminate, your subsidiary's operations. This directly or indirectly affects the parent institution.

If you only have correspondent accounts inside the US, those account relationships can be closed, or the funds frozen if there is a finding that illicit assets exist. Do you really think that these untoward events will not occur in the context of America's global war on terrorism ?

If your bank loses access to the US financial structure and its markets, your best customers will flock to your competitors forthwith. How will this impact you annual profits ? I rest my case. 

Therefore, it behooves you to adopt US AML standards, and American banking best practises, notwithstanding where you are phycially located. Consider it prudent risk reduction. After all, who wants their bank to suffer the indignities of having to sign a Consent Agreement, which reveals all the AML shortcomings, and have the industry read it on the regulators' websites.