Entities that are Affected
Insurance companies, certain loan or finance companies, dealers in precious metals, precious stones, or jewels, private banks, non-federally insured credit unions, and certain trust companies.
Why the extension of the BSA net?
The Sentiment is that the disparity in AML coverage between banks with and without a Federal Functional Regulator presents a vulnerability to the U.S. financial system that could be exploited by bad actors.
Who are the Federal Functional Regulators?
Although many banks lacking a Federal Functional Regulator are already obligated to comply with a number of BSA regulations, everyone needs to be ready
FinCEN states that they don’t expect the transition to compliance with the Final Rule to be unreasonable due to the fact that Banks lacking a Federal Functional Regulator generally are currently required by state banking regulation and guidance to have policies, management oversight, personnel training, and internal compliance review and various procedures and systems in place to comply with regulation and guidance. Thus, banks not subject to these state regulatory requirements still have to develop policies and procedures to properly function and comply with their BSA obligations and state banking regulations such as the filing of CTRs and SARs in order to detect “unusual activity”.
That said, all entities that are affected by this Final Rule ought to start making the appropriate changes to their internal controls, policies and procedures and assure that they are in compliance with the 5 Pillars of AML:
Who is assisting you in the Examination of your AML Compliance Program? Will you be ready if you are an Affected Institution? ©