Anti-Money Laundering/Anti-Financial Crimes Roundtable (AML Roundtable)

The Anti-Money Laundering/Anti-Financial Crimes Roundtable (AML Roundtable)

Purpose:
The purpose of the AML Roundtable is to serve as a community where AML/AFC staff can regularly network and consult with peers on complicated issues/situations at their credit unions. By providing an expanded support network for AML/AFC professionals, the AML Roundtable will help strengthen credit union AML and anti-financial crime efforts.

Roundtable Membership & Governance:
The Roundtable will be comprised of AML/AFC officers from member and non-member credit unions and system stakeholders.While NASCUS will provide the administrative support for the Roundtable, the Roundtable will be co-governed by NASCUS and Community Financial Credit Union (Michigan).

Meetings:
In 2023, the Committee will meet quarterly with additional calls as needed. Once the Roundtable builds a base community of participants, quarterly calls will be supplemented with production of original subject matter podcast content.

NASCUS Staff Liaison:
Brian Knight, NASCUS President/CEO
Sarah Stevenson, NASCUS Vice President of Regulatory Affairs

Credit Union Representative:
Craig Money, VP Operations and Risk, Family Trust Federal Credit Union

NASCUS Resources
In the News

Updates to FFIEC BSA Examination Manual

August 2, 2023 – The FFIEC members have reorganized some existing sections of the Manual to create new, individual sections based on specific regulations. Modifications to the six sections included in this release are detailed below. Sections have been deleted from the “Risks Associated with Money Laundering and Terrorist Financing” portion of the Manual. Concepts from the deleted sections are now included within related sections of “Assessing Compliance with BSA Regulatory Requirements.” There were no changes to the regulatory requirements covered by these sections. The agencies made revisions to ensure language clearly distinguishes between mandatory regulatory requirements and considerations set forth in guidance or supervisory expectations. The updated sections provide further transparency into the BSA/AML examination process and do not establish new requirements. The FFIEC revised the sections in close collaboration with Treasury’s Financial Crimes Enforcement Network.

Revised Section: Special Information Sharing Procedures to Deter Money Laundering and Terrorist Activity
Updated and retitled the previous Information Sharing section to align with the regulations at 31 CFR 1010.520 and 31 CFR 1010.540.

Revised Section: Due Diligence Programs for Correspondent Accounts for Foreign Financial Institutions
Updated and combined the previous Foreign Correspondent Account Recordkeeping, Reporting and Due Diligence section and Correspondent Accounts (Foreign) sections and retitled to align with the regulation at 31 CFR 1010.610.

Read more here

FinCEN Provides Key Updates on Rulemaking Agenda Timeline

July 9, 2023 – Without much fanfare, the Financial Crimes Enforcement Network (FinCEN) published in June its Spring 2023 Rulemaking Agenda, which provides proposed timelines for upcoming key rulemakings projected throughout the rest of 2023.  FinCEN continues to focus on issuing rulemakings required by the Anti-Money Laundering Act of 2020 (the “AML Act”) and the Corporate Transparency Act (“CTA”).  FinCEN has been criticized for being slow in issuing regulations under the AML Act and the CTA, but Congress has imposed many obligations upon FinCEN, which still is a relatively small organization with a limited budget.

Here are the six upcoming rulemakings and their expected timing.  All of these issues are critical. We also discuss the issues for which FinCEN has not provided a proposed timeline.

  • July 2023: Notice of Proposed Rulemaking (NPRM) implementing section 6314 of the AML Act and the Anti-Money Laundering Whistleblower Improvement Act regarding whistleblower incentives and protections. As a reminder, qualifying whistleblowers are entitled to awards between 10 and 30 percent of the value of “monetary sanctions” above $1 million collected through an enforcement action regarding certain violations of the Bank Secrecy Act (BSA) and U.S. economic sanctions. A whistleblower also may be awarded additional monies for related actions. In addition, the Department of Treasury will administer the newly created Financial Integrity Fund to pay whistleblower awards. We previously have blogged about section 6314 here, here and here.
  • August 2023: NPRM regarding real estate transaction reports and records. The release of the NPRM was pushed back by several months. FinCEN released an advanced NPRM in December 2021, which sought comments on potential BSA/AML requirements for persons involved in real estate transactions, particularly non-financed transactions. Critical issues will include the scope of the proposed BSA requirements, and the type of real estate transactions to which they will apply (E.g. Any monetary threshold?  Nationwide application?  Only residential deals, or commercial deals as well?  Who is responsible for any reporting requirements? Etc.)
  • September 2023: Final Rule regarding beneficial ownership information (BOI) access and safeguards and the use of FinCEN Identifiers. The final rule will establish the framework for authorized recipients’ access to BOI as well as instances where reporting companies can use FinCEN Identifiers.  As we previously blogged, there was strong push back by the financial services industry, partly because the proposal limited financial institutions’ ability to use BOI, thereby contradicting the CTA’s objectives.
  • November 2023: Final Rule implementing section 6212 of the AML Act that establishes a pilot program permitting financial institutions to share suspicious activity reports (SARs) with their foreign branches, subsidiaries, and affiliates. This final rule has been delayed by several months from FinCEN’s prior rulemaking agenda.
  • December 2023: NPRM implementing section 6101(b) of the AML Act that establishes national exam and supervision priorities. Section 6101(b) requires financial institutions to incorporate a risk assessment and AML/countering financial terrorism (CFT) priorities into their risk-based compliance programs. In June 2021, FinCEN preliminarily released the first set of national AML/CFT priorities but highlighted that these did not have to be incorporated into compliance programs until regulations were promulgated. FinCEN will update these priorities every four years.  As we previously blogged, the preliminary list of priorities was extremely broad, to the point of presenting limited utility.  The NPRM will be important in regards to whether it provides any greater clarity or precision.
  • December 2023: Lastly, a NPRM revising the existing Customer Due Diligence (CDD) Rule is expected. This is the third required rulemaking in the series to implement the BOI rule under the CTA.  Given the current differences between how the CDD Rule and the CTA define “beneficial owner,” as well as differences involving exempted entities and serious questions regarding how financial institutions can or should access BOI under the CTA in order to comply with the CDD Rule, this will be a very important NPRM.

Notable absences from FinCEN’s rulemaking agenda include a NPRM implementing section 6305 of the AML Act, which provides for a no-action letter (NAL) program. FinCEN conducted an assessment, determined that a NAL program was appropriate, and issued an ANPRM in June 2022. FinCEN’s Fall 2022 rulemaking agenda projected a NPRM in November 2023, but this item is missing from the Spring agenda.

Read more here

March 24, 2023 — The Financial Crimes Enforcement Network (FinCEN) published its first set of guidance materials to assist the small business community in understanding upcoming beneficial ownership (BOI) reporting requirements that take effect on January 1, 2024.

  • The BOI final rule can be found here and NASCUS summary can be found here.

The resources are available on FinCEN’s beneficial ownership information reporting webpage, www.fincen.gov/boi, and include:

FAQs: https://www.fincen.gov/boi-faqs

Key Filing Dates:   https://www.fincen.gov/sites/default/files/shared/BOI_Reporting_Filing_Dates-Published03.24.23_508C.pdf

Key Questions: https://www.fincen.gov/sites/default/files/shared/BOI_Reporting_Key_Questions_Published_508C.pdf

Introductory Video: https://youtu.be/nx48tPUbRK0

A More Detailed Informational Video: https://youtu.be/qP5V9k3ypl0