A rule that would, among other things, have federal bank and credit union regulators “consult” with the Financial Crimes Enforcement Network (FinCEN) on certain anti-money laundering/countering the financing of terrorism (AML/CFT) actions was issued Tuesday for a 60-day public comment period.
The Federal Deposit Insurance Corp. (FDIC), National Credit Union Administration (NCUA), and Office of the Comptroller of the Currency (OCC) jointly issued their request for comment, noting the proposed rule’s changes are “intended to align each agency’s AML/CFT rules with changes concurrently proposed” by FinCEN. FinCEN released its proposal Tuesday as well.
The FDIC Board approved issuance of its proposal Tuesday, during its open meeting.
The notice of proposed rule says the rule, among other things, “would ensure that institutions establish and maintain effective AML/CFT programs that are intended to better achieve the purposes of the Bank Secrecy Act (BSA), culminating in the development of highly useful information related to illicit financial transactions for law enforcement and national security agencies.”
It says that through this rulemaking, they also “intend to modernize and reform Federal supervision of AML/CFT programs by enhancing FinCEN’s role in AML/CFT supervision and enforcement.”
The financial institution regulators, summarizing the proposal, said the rule changes would:
- Incorporate the AML Act provision that a bank’s AML/CFT program should be risk-based, including ensuring that banks direct more attention and resources toward higher-risk customers and activities, consistent with the risk profile of the institution, rather than toward lower-risk customers and activities.
- Describe the requirements for a bank to establish an AML/CFT program; explicitly incorporate FinCEN’s existing customer due diligence requirement; and clarify that a bank’s designated AML/CFT officer must be located in the U.S. and accessible to regulators.
- Require that once a bank has properly established its AML/CFT program, the institution maintains that program in all material respects. In addition, the proposed rule would clarify that only significant or systemic failures to implement a properly established program would warrant an “AML/CFT enforcement action” or a “significant AML/CFT supervisory action.”
- Enhance FinCEN’s role in the Agencies’ supervision and enforcement process by establishing a new consultation framework for certain actions by the Agencies.
- Clarify that banks may share any information with FinCEN related to certain AML/CFT supervisory and enforcement actions.
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