The House version of the fiscal year 2021 National Defense Authorization Act (NDAA) should include legislation to end the abuse of anonymous shell companies and modernize anti-money laundering (AML) requirements and expectations, CUNA and other organizations wrote to the House Armed Services Committee Monday. A proposed amendment to the bill would add legislation from Reps. Carolyn Maloney (D-N.Y.) and Emanuel Cleaver (D-Mo.) with the AML modernizations to the NDAA, which the House will consider over several days this week.
“The bill includes critical provisions for law enforcement investigations into organized transnational criminal operations, human trafficking, terrorism financing, sanctions evasion and other unlawful activity that threatens our national security,” the organizations wrote. “The resulting legislation to create a secure beneficial ownership registry of legal entities, held at the Financial Crimes Enforcement Network, a bureau of the Department of the Treasury, represents the best path forward to provide law enforcement with needed information to pursue criminals looking to exploit our financial system.
“The bills strike the right balance between imposing minimal requirements on small businesses and providing critical information to law enforcement and financial institutions,” the letter adds.
The legislation would also modernize Treasury authorities and certain AML requirements, which CUNA believes will allow financial institutions to better assist law enforcement in its effort to detect and deter financial crime and terrorism.
The Currency Transaction Reporting threshold (CTR) has not been updated since the Bank Secrecy Act was enacted in 1970, and the amendment would index the CTR threshold for inflation every five years and further study the impact of Suspicious Activity Reports. This effort by Maloney and Cleaver addresses significant opportunities for modernization of the BSA/AML framework.