FinCEN issues first AML/CFT priorities

FinCEN issues first AMLCFT priorities

FinCEN, the Financial Crimes Enforcement Network, has issued its first national ‘Priorities Letter’ for anti-money laundering and countering the financing of terrorism. Although specific areas of compliance have not yet been set out it would be wise to review your AML framework with these priorities in mind. This is particularly important if you’re a registered FINRA broker-dealer, and therefore obliged to maintain a written AML compliance program. 

FinCEN published its letter: Anti-Money Laundering and Countering the Financing of Terrorism National Priorities at the end of June in consultation with the US Dept. of the Treasury’s Office of Foreign Assets Control (OFAC), federal and state regulators, law enforcement, and national security agencies. 

FinCEN also issued two statements – one to banks and the other to covered non-bank financial institutions, in an effort to provide more guidance to the priorities.  According to FinCEN, these priorities are “intended to assist all covered institutions in their efforts to meet their obligations under laws and regulations designed to combat money laundering and counter terrorist financing.” 

The priorities letter, in no particular order, include: 

  1. Corruption; 
  2. Cybercrime (including cybersecurity and virtual currency considerations); 
  3. Foreign and domestic terrorist financing; 
  4. Fraud; 
  5. Transnational criminal organization activity; 
  6. Drug trafficking organization activity; 
  7. Human trafficking and human smuggling; and, 
  8. Proliferation financing. 

Although the notice outlines specific areas of priority as to which areas should be incorporated into covered financial institutions’ risk-based AML programs, FinCEN will issue regulations at a later date that will further specify how financial institutions should review and incorporate each priority outlined into their broader risk-based AML program.  Additionally, the notice stated that FinCEN “will update the priorities at least once every four years, as required by the AML Act,” in an effort “to account for emerging threats to the US financial system and national security.” 

How Bovill can help  

Bovill provides US regulatory and AML compliance support services to SEC, CFTC/NFA, FINRA, FinCEN, and exchange regulated financial services organizations which are all entities that must have a sound AML compliance framework.   

All registered FINRA broker-dealers, are required under FINRA Rule 3310 and the Bank Secrecy Act (BSA) to develop, implement, and maintain a written AML compliance program.  We regularly perform the necessary annual reviews for our broker-dealer clients to assess adherence to FINRA Rule 3310 and the Bank Secrecy Act.  Review elements include, but are not limited to, adequacy of the AML program and management approval, adequacy of the AML training program, methods of customer identification, detection/reporting of suspicious activity, OFAC compliance/Specially Designated Nationals (SDN) and sanctions screening, BSA reporting, and assessment of required FinCEN information request and sharing procedures.   

Additionally, we can provide guidance in conducting AML due-diligence, based on the needs of your firm.  For more information about the impact of this notice on your organization, please get in touch. 

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