WASHINGTON—NCUA has joined with the Federal Reserve, the NCUA, the Office of the Comptroller of Currency, the FDIC and the Financial Crimes Enforcement Network in issuing a joint statement restating their position that banks and credit unions must take a risk-based approach to assessing individual customer/member risk.
The statement reinforces the NCUA’s position that no single member type automatically presents a high risk of money laundering, terrorist financing, or other illicit financial activity risk, stated NCUA Board Chairman Todd Harper.
“The regulations established in the Bank Secrecy Act (BSA) establish a risk-based approach to assessing customer relationships and conducting customer due diligence. The NCUA expects credit unions to assess the risks posed by each customer individually,” Harper said. “Further, the NCUA advises against refusing service or discontinuing service to an entire class of customers based on perceived risk. Credit unions that comply with BSA and anti-money laundering (AML) requirements and have an effective customer due diligence program in place are well-positioned to manage customer relationships and risks appropriately, based on each individual customer relationship.”
What Manual Says
Harper further reminded the Federal Financial Institutions Examination Council’s BSA/AML Examination Manual identifies specific customer/member types to provide examiners with guidance regarding unique characteristics.
The Manual is not intended to suggest that those characteristics represent a higher money laundering, terrorist financing, or illicit finance risk, Harper said, adding it is ultimately each credit union’s decision to provide or maintain financial services to any member.
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