Interagency statement notes first-ever AML/CFT national priorities; rules yet to come

An interagency statement Wednesday by federal and state financial institution regulators gives supervised institutions a heads up to plans for future Bank Secrecy Act (BSA) rule changes to incorporate just-issued national priorities for anti-money laundering and countering the financing of terrorism (AML/CFT) policy.

These priorities, which describe “the most significant AML/CFT threats currently facing the United States,” were issued by Treasury’s Financial Crimes Enforcement Network (FinCEN) following consultation with other Treasury offices, federal and state regulators, law enforcement, and national security agencies pursuant to the 2020 Anti-Money Laundering Act, FinCEN said in its announcement.

The agencies’ statement offered no target date for a proposed rule, but the AML Act requires that FinCEN promulgate rules to implement the priorities within 180 days of their publication.

“Today’s publication of government-wide AML/CFT Priorities is a significant milestone in FinCEN’s efforts to improve the efficiency and effectiveness of the nation’s AML/CFT regime and to foster greater public-private partnerships,” said FinCEN Acting Director Michael Mosier. “The Priorities reflect the U.S. Government’s view of the threat landscape – highlighting longstanding threats like corruption, fraud, and international terrorism, as well as rapidly evolving and acute threats, such as domestic terrorism, and ransomware and other cybercrime.”

In all, the national priorities include corruption, cybercrime, domestic and international terrorist financing, fraud, transnational criminal organizations, drug trafficking organizations, human trafficking and human smuggling, and proliferation financing.

FinCEN said the national AML/CFT priorities and accompanying AML/CFT priorities statements are meant to assist covered institutions in their AML/CFT efforts and enable them to prioritize the use of their compliance resources. It said the priorities highlight key threat trends as well as informational resources that can help institutions in managing their risks.

Bank and credit union regulators said that while not required to do so, they plan to propose changes to their own BSA rules addressing the priorities. Banks and credit unions (as well as nonbanks, the target of a separate FinCEN statement) are not required to make any changes in their risk-based BSA compliance programs, and examiners will not review institutions for incorporation of the AML/CFT priorities into those programs, until the effective date of a final rule, the agencies and FinCEN said.

In their statement, however, the agencies said institutions “may wish to start considering how they will incorporate the AML/CFT Priorities into their risk- based BSA compliance programs, such as by assessing the potential related risks associated with the products and services they offer, the customers they serve, and the geographic areas in which they operate.”

FinCEN said it will update the priorities to highlight new or evolving AML/CFT threats at least once every four years, as required by the AML Act. It said the priorities, coupled with Treasury’s 2020 Illicit Finance Strategy and 2018 National Risk Assessment, aim to help covered institutions assess their risks, tailor their AML programs, and prioritize their resources.

The interagency statement was issued by FinCEN along with the Federal Deposit Insurance Corp. (FDIC), Federal Reserve Board, National Credit Union Administration (NCUA), Office of the Comptroller of the Currency (OCC), and state bank and credit union regulators. It was circulated to supervised institutions in an FDIC Financial Institution Letter, NCUA Letter to Credit Unions, and OCC Bulletin. The Fed issued a Supervision and Regulation Letter to the Reserve Banks for further distribution to supervised entities.

A separate statement was issued by FinCEN to “nonbank” entities subject to federal BSA requirements.

Wednesday’s issuance of the national priorities was on a list of nine achievements noted by the agency Wednesday in a release giving a 180-day update on its implementation of the AML Act (see release).

Interagency Statement on the Issuance of the Anti-Money Laundering/ Countering the Financing of Terrorism National Priorities

FinCEN release: FinCEN Issues First National AML/CFT Priorities and Accompanying Statements

FDIC FIL-46-2021

Federal Reserve SR 21-10

NCUA Letter 21-CU-05