WASHINGTON—CUNA has sent a comment letter to FinCEN supporting the agency’s proposal that would ensure certain financial institutions lacking a federal regulator—including privately insured credit unions (PICUs)—follow the same BSA-related requirements as other financial institutions.
CUNA is also asking FinCEN to expand the scope of the rule.
“CUNA supports the proposed rule as issued,” wrote Luke Martone, senior director of advocacy and counsel. “Over the years, CUNA has received questions from PICUs seeking clarification on their BSA requirements, including those addressed by the proposed rule. The proposed rule change should reduce confusion that has popped up from time to time regarding expectations and requirements of PICUs. Further, through discussions with individual PICUs, state credit union leagues, and the National Association of State Credit Union Supervisors, it is our understanding that most—if not all—PICUs are required by their state financial regulator to comply with BSA requirements that parallel those required of federally insured credit unions by the National Credit Union Administration.”
Martone wrote that CUNA also supports the proposed rule because it will ensure that other—non-PICU—banks lacking a federal functional regulator (i.e., private banks and certain trust companies) will adhere to established requirements pertaining to anti-money laundering, customer identification, and beneficial ownership.
“Applying uniform standards across the entire banking system will improve FinCEN’s ability to combat financial crime,” he said.
“To further FinCEN’s effectiveness at combating financial crime, we ask it to consider whether it would be appropriate to expand the scope of the proposed rule beyond ‘banks lacking a federal functional regulator’ to also apply to certain payment and acceptance services, such as PayPal, Western Union, Apple Pay, and others, which collectively transfer and settle millions of dollars in payments without being subject to BSA requirements,” continued Martone. “Expansion of the beneficial ownership requirements to such entities would further enhance the overall transaction system compliance profile, while ensuring entities that fall outside the traditional banking model comply with the same standards as the banking system.”