Comments on potential BSA requirements for cash real estate transactions due Monday

Public comments on an advance notice of proposed rulemaking (ANPR) on potential Bank Secrecy Act (BSA) requirements for cash real estate transactions are due Monday to Treasury’s financial crimes enforcement unit.

The ANPR, released in December by the Financial Crimes Enforcement Network (FinCEN), seeks input on such requirements for cash residential and commercial real estate transactions. FinCEN notes that while real estate lending activity is already addressed in its BSA anti-money laundering (AML) rules, cash transactions are not (though some requirements have been imposed on title insurance companies in the form of Geographic Targeting Orders).

FinCEN, in its December ANPR, noted that money laundering risks stem from transactions in both the commercial and residential real estate sectors, and both merit appropriate regulatory treatment. “At the same time, FinCEN recognizes that an iterative approach may be warranted given the complexities and differences between different market sectors and the potential burdens that new reporting and recordkeeping requirements may have for businesses,” it said.

The agency noted that if iterative approach is warranted, FinCEN could initially focus on residential real estate followed by additional action to promulgate regulations covering the commercial real estate sector, “as well as any other regulatory gaps that may exist with money laundering vulnerabilities involving real estate.”

It said input is sought on the approach FinCEN should take regarding the regulatory treatment of residential and commercial real estate; and the money laundering threats presented by these sectors.

The comment deadline was initially set for Feb. 7 but was later extended to Feb 21.

Reg lookup: Anti-Money Laundering Regulations for Real Estate Transactions