The U.S. Treasury's Financial Crimes Enforcement Network (FinCEN) published a proposed rule to remove the anti-money laundering (AML) program exemption for "banks" that lack a "federal functional regulator," including, but not limited to, private banks, non-federally insured credit unions and certain trust companies. Comments are due by Oct. 24.
Most financial institutions became subject to an AML program requirement under the Bank Secrecy Act (BSA) with FinCEN's issuance of an interim final rule in 2002. The interim final rule stated that an institution regulated by a federal functional regulator “shall be deemed to satisfy the requirements of 31 U.S.C. 5318(h)(1) if it implements and maintains an [AML] program that complies with the regulation of its Federal functional regulator governing such programs.”
“Federal functional regulator” includes the NCUA, each of the federal banking agencies, as well as the Securities and Exchange Commission and the Commodity Futures Trading Commission. NCUA's BSA-AML program requirements are found in Part 748.2 of the agency's regulations.
FinCEN’s proposed rule would prescribe minimum standards for AML programs for institutions without a federal functional regulator to ensure that all institutions, regardless of whether they are subject to federal regulation and oversight, are required to establish and implement anti-money laundering programs, and would extend customer identification program requirements and beneficial ownership requirements to those institutions not already subject to these requirements.