OCC Finalizes Rule Allowing Exemptions from SAR Requirements

To help banks develop more efficient and effective Bank Secrecy Act compliance programs, the OCC finalized a rule that would allow the agency to issue exemptions from Suspicious Activity Report requirements in certain circumstances.

Under the proposal, national banks seeking an exemption must submit a request in writing to the OCC. In reviewing these requests, “the OCC will consider whether the exemption is consistent with the purposes of the [Bank Secrecy Act] and with safe and sound banking, and may consider any other appropriate factors,” including outstanding supervisory concerns regarding BSA/AML compliance. Institutions would also need to seek an exemption separately from the Financial Crimes Enforcement Network.

The final rule will enable the OCC to facilitate changes required by the Anti-Money Laundering Act of 2020, and will also make it possible for the OCC to grant relief to national banks or federal savings associations that develop innovative solutions intended to meet Bank Secrecy Act requirements more efficiently and effectively. The rule takes effect May 1.

The FDIC and Federal Reserve have also issued separate proposals regarding SAR exemptions. In its comment letter to all three agencies on the matter, the American Bankers Association advocated for an interagency rulemaking. The association remains concerned that if the other agencies do not adopt identical rules, banks could face added regulatory burden and conflicting rules.