FinCEN pilot would allow sharing of SAR info with foreign branches, others

A proposed pilot program to allow financial institutions to share suspicious activity reports (SARs) and related information with their foreign branches, subsidiaries, and affiliates to combat illicit finance risks is out for comment until March 28, according to a Federal Register notice published Tuesday.

The proposed rule, issued with a March 28 comment deadline by the Financial Crimes Enforcement Network (FinCEN), would provide for a limited-duration program as required by the 2020 Anti-Money Laundering Act.

FinCEN said its previously issued guidance on sharing SARs within a corporate organizational structure stated that financial institutions may share SARs with foreign head offices, controlling companies (whether domestic or foreign), and domestic affiliates. “If finalized, the proposed rule would establish a limited-duration pilot program to allow SAR sharing with foreign affiliates, which would also provide FinCEN with valuable feedback about the value of such SAR sharing for participating financial institutions and for FinCEN and law enforcement,” it said.

The agency is seeking public comment on questions related to the establishment of a SAR sharing pilot program, such as expected costs and benefits, technical challenges, the merits of quarterly reporting, and how to protect SAR confidentiality.

The proposal, it said, would seek to ensure that information-sharing is “limited by the requirements of federal and state law enforcement, takes into account potential concerns of the intelligence community, and is subject to appropriate standards and requirements regarding data security and the confidentiality of personally identifiable information.”

While the 2020 AML Act requires that the pilot program terminate three years after the law’s enactment, it also permits the Treasury secretary to extend that by two years “upon reporting” to the House Financial Institutions Committee and Senate Banking Committee, the agency said.

FinCEN Issues Proposed Rule for Suspicious Activity Report Sharing Pilot Program to Combat Illicit Finance Risks

Reg lookup: Pilot Program on Sharing of Suspicious Activity Reports and Related Information With Foreign Branches, Subsidiaries, and Affiliates