ARLINGTON, Va.—NAFCU is offering support for FinCEN defining an overall “effective and reasonably” designed anti-money laundering (AML) program – including an explicit requirement for a risk-assessment.
Kaley Schafer, NAFCU senior regulatory affairs counsel, sent the agency a letter in response to FinCEN’s advance notice of proposed rulemaking gathering public feedback on potential improvements to AML programs. However, Schafer noted the risk-assessment should not require national AML priorities due to the increased compliance burdens and voiced several additional recommendations.
The ANPR was issued in September, in conjunction with a final rule to remove an AML program exemption for certain banks that lack a federal function regulator.
“In addition to defining an effective and reasonably designed AML program, FinCEN should consider changes to existing mechanisms, such as the information-sharing programs, suspicious activity reports (SARs), and currency transaction reports (CTRs) to increase overall AML effectiveness,” wrote Schafer.
Additional Support
On information sharing programs, Schafer noted NAFCU agrees with the Bank Secrecy Act Advisory Group (BSAAG) recommendation to enhance information-sharing among financial institutions, regulators and law enforcement through partnerships and other existing mechanisms.
On SAR reform, Schafer again expressed an agreement with the BSAAG’s recommendation to support the possibility of a streamlined SAR for continuing activity. Adoption of a simplified SAR form for the purposes of continuous SAR filings will “reduce compliance burdens as the initial SAR filing provides all the necessary information,” Schafer noted.
On CTR reform, Schafer voiced support a CTR threshold increase or indexing to inflation to better capture suspicious transactions.
In addition to these recommendations, Schafer requested that FinCEN provide an implementation period or compliance date for credit unions to incorporate the priorities.