According to a draft proposal by banking regulators released on June 20, the Financial Crimes Enforcement Network is planning to publish a program rule notice of proposed rulemaking. If finalized, financial institutions would be required to amend their anti-money laundering and countering the financing of terrorism programs to incorporate AML/CFT national priorities, along with other changes.
The draft proposal by the Federal Reserve, OCC, FDIC and National Credit Union Administration would align each agency’s Bank Secrecy Act compliance program requirements with changes FinCEN is planning as the result of passage of the Anti-Money Laundering Act in 2021. According to the draft, FinCEN’s proposed program rule would clarify supervisory expectations regarding how banks should identify, evaluate and document their money-laundering, terrorist financing and other illicit finance activity risks, including requiring banks to consider the AML/CFT national priorities. However, banks are not expected to exclusively focus on the AML/CFT national priorities, as the proposed risk-assessment process would also require consideration of money laundering/terrorist financing and illicit finance activity risks based on the bank’s business activities, including “distribution channels” and “intermediaries,” as well as a review of BSA reports filed by the bank.
The proposed rule would also add the requirement the AML/CFT program be “effective” and “risk-based” to the current standard and be “reasonably designed.” According to the agencies, the proposed statement of purpose is not intended to establish new obligations separate and apart from the specific requirements set out for banks or impose additional costs or burdens, but to summarize the goal that banks AML/CFT programs are “operating in an effective, risk-based and reasonably designed manner.”
