FTA Comment Letter re: FinCEN’s Anti-Money Laundering and Countering the Financing of Terrorism Programs Proposal
The Financial Technology Association (FTA) submitted a comment letter responding to the Financial Crimes Enforcement Network’s (FinCEN) proposed rule to revise anti-money laundering and countering the financing of terrorism (AML/CFT) program requirements for financial institutions governed by the Bank Secrecy Act (BSA).
“FTA members, including banks, MSBs, broker-dealers, and other entities covered by the BSA, recognize the importance of the program rule for setting the parameters of an institution’s efforts to detect and deter illicit financial activity,” wrote FTA President and CEO Penny Lee. “FTA supports FinCEN’s efforts to emphasize the risk-based nature of AML/CFT compliance programs and provide “financial institutions with the flexibility to extend financial services based on their individual evaluation of their ML/TF risks and their ability to manage their customer relationships…”
“We particularly support the preamble’s emphasis on creating risk-based programs that encourage the use of innovative technologies for compliance, programmatic changes to enhance financial inclusion, and language relating to revising financial institutions’ current processes and procedures to make their programs more efficient and effective and redeploy compliance resources to areas of higher risk.”
However, we believe additional changes to the regulation should be made to enhance the regulatory framework supporting institutions’ risk-based programs so that covered institutions have a clear understanding of and are comfortable calibrating their programs to a risk-based approach.
“We would recommend the following:
FinCEN should provide additional language in the regulation on redeploying resources, apply a good-faith standard to program requirements, and limit U.S.-based duty requirement to the AML/CFT officer;
FinCEN’s approach to incorporating the National AML/CFT Priorities should be narrowed to emphasize further the risk-based nature of a financial institution’s AML/CFT program;
Enhance FinCEN’s capabilities and law enforcement feedback to increase the utility of AML/CFT reporting; and
The proposal’s effective date should be set two years after the final rule, and any expectations account for updates to the National AML/CFT Priorities.”
The Financial Technology Association (FTA) is a Washington, DC-based trade association representing industry leaders shaping the future of finance. We champion the power of technology-centered financial services and advocate for the modernization of financial regulation to support inclusion and responsible innovation.
FTA Comment Letter re: FinCEN’s Anti-Money Laundering and Countering the Financing of Terrorism Programs Proposal
The Financial Technology Association (FTA) submitted a comment letter responding to the Financial Crimes Enforcement Network’s (FinCEN) proposed rule to revise anti-money laundering and countering the financing of terrorism (AML/CFT) program requirements for financial institutions governed by the Bank Secrecy Act (BSA).
“FTA members, including banks, MSBs, broker-dealers, and other entities covered by the BSA, recognize the importance of the program rule for setting the parameters of an institution’s efforts to detect and deter illicit financial activity,” wrote FTA President and CEO Penny Lee. “FTA supports FinCEN’s efforts to emphasize the risk-based nature of AML/CFT compliance programs and provide “financial institutions with the flexibility to extend financial services based on their individual evaluation of their ML/TF risks and their ability to manage their customer relationships…”
“We particularly support the preamble’s emphasis on creating risk-based programs that encourage the use of innovative technologies for compliance, programmatic changes to enhance financial inclusion, and language relating to revising financial institutions’ current processes and procedures to make their programs more efficient and effective and redeploy compliance resources to areas of higher risk.”
However, we believe additional changes to the regulation should be made to enhance the regulatory framework supporting institutions’ risk-based programs so that covered institutions have a clear understanding of and are comfortable calibrating their programs to a risk-based approach.
“We would recommend the following:
Read the full letter here.
ABOUT US
The Financial Technology Association (FTA) is a Washington, DC-based trade association representing industry leaders shaping the future of finance. We champion the power of technology-centered financial services and advocate for the modernization of financial regulation to support inclusion and responsible innovation.