The Financial Crimes Enforcement Network (FinCEN) released a statement to financial institutions on March 16, 2020, concerning the COVID-19 pandemic. The statement covered two main topics:
First, FinCEN addressed COVID-19-affected financial institutions that have concern over potential delays in their ability to file required BSA reports. It encourages these institutions to contact both FinCEN and their functional regulator “as soon as practicable” and keep them apprised as circumstances change. The statement directs financial institutions seeking to contact FinCEN to “call FinCEN’s Regulatory Support Section (RSS) at 1-800-949-2732 and select option 6 or e-mail at FRC@fincen.gov.”
Second, FinCEN advised institutions to remain vigilant regarding potential financial fraud, which has arisen in the wake of past natural disasters. It specified the following emerging trends on this front:
FinCEN also directed financial institutions to its prior advisory regarding disaster-related fraud, which discusses other relevant fraud types, including benefits fraud, charities fraud and cyber-related fraud.
Where suspicious transactions involve COVID-19, FinCEN advised individuals preparing suspicious activity reports (SARs) not only to identify the appropriate suspicious activity typologies, but also to enter “COVID19” in Field 2 of the SAR template.
FinCEN did not commit to extending any reporting deadlines. As a result, financial institutions should remain vigilant during this challenging time and develop methods to continue investigating fraud and related alerts in accordance with regulations and company policy. And if any COVID-19-related delays arise, contact FinCEN and functional regulators as soon as possible. A simple call or email now may avoid MRAs, penalties and other regulatory pitfalls later.
For details, see the full text of FinCEN’s release, available online.