Serving a vital purpose for the U.S. financial system, the Bank Secrecy Act (BSA) protects its individual members from being used to finance illegal activity. But at 50 years old, its ability to achieve that purpose has not kept pace with an ever-evolving world, as the law remains largely unchanged except for a few updates.
CSI’s white paper, BSA/AML Compliance: A Growing Consensus for Change, explores the need to modernize BSA/AML compliance and provides insight on recent updates designed to combat financial crime, including new guidance on Section 314(b) of the USA PATRIOT Act.
Complying with the very static BSA in such a complex environment presents significant financial, operational and reputational costs for institutions. Recognizing these challenges, FinCEN is focused on adapting the BSA’s AML regime to confront threats related to illicit financial activities, while awarding institutions the flexibility necessary to address such threats.
Recently, FinCEN issued new guidance relating to Section 314(b) of the USA PATRIOT Act, which allows financial institutions to share information about suspicious activity related to money laundering and terrorist financing. These recent clarifications will strengthen this provision and empower institutions to fight financial crime.
Another recent update gaining momentum is the Corporate Transparency Act (CTA)—a component of the Anti-Money Laundering Act of 2020. To further mitigate AML risks, the CTA will create a beneficial ownership database at FinCEN and require reporting companies to disclose certain information about their beneficial owners. By modernizing AML regulations with provisions such as the CTA, institutions will have enhanced tools to combat emerging money-laundering and terrorist-financing threats.
Read CSI’s BSA/AML Compliance: A Growing Consensus for Change white paper to learn more about the growing agreement for updating AML compliance regulations to better match the true reality of today’s changing world.
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