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The latest edition of NAFCU's Economic & CU Monitor report – now available for download – found that nearly half of survey respondents saw an increase in the number of defensive filings of suspicious activity reports (SARs) in the past year. NAFCU has actively sought Bank Secrecy Act (BSA)/anti-money laundering (AML) regime-related improvements and relief for credit unions, most recently advocating for lawmakers in the Senate to hold a markup of the ILLICIT CASH ACT (S. 2563).

"NAFCU has often noted that the decision whether to file a SAR may be less than clear," wrote NAFCU Chief Economist and Vice President of Research Curt Long. "Identifying suspicious activity requires a degree of subjective judgement, and the quality and breadth of guidance issued by regulators like [the Financial Crimes Enforcement Network (FinCEN)] or the Federal Financial Institutions Examination Council (FFIEC) is critical."

The survey also revealed that many respondents viewed current FinCEN guidance regarding SAR filings as "merely adequate," with a quarter of respondents indicating that they would like additional resources from the agency.

Last month, the House passed the NAFCU-supported COUNTER Act, H.R. 2514, as a standalone bill aimed at providing BSA/AML relief. If signed into law, the bill would reduce the burden of certain SAR filings on financial institutions and would index the threshold for currency transaction reports. Lawmakers in the Senate have also introduced measures for BSA/AML relief.

Additionally, the association continues to meet with stakeholders on this issue. In an October meeting with FinCEN, NAFCU shared credit union concerns regarding the implementation of some S. 2155 provisions and the regulatory burden presented by the agency's rules on collecting SARs. 

Also included in the Monitor are results from the November Credit Union Sentiment Index (CUSI), an index based on NAFCU member responses to eight questions on growth and earnings outlook, lending conditions and regulatory burden.

The CUSI plunged to its lowest point on record in November. All four component scores fell during the month, with the growth score seeing the sharpest drop. Among survey respondents, 19 percent rated growth conditions at their credit unions as "somewhat poor," another record for the index.

NAFCU relies on survey responses to provide its members a glimpse of trends affecting the credit union industry as a whole. The association also uses survey responses to inform its advocacy efforts on Capitol Hill and with regulatory agencies such as the NCUA, the bureau and the Federal Reserve.

The next survey is focused on data privacy. Participants can fill out the survey online; responses are due Jan. 8, 2020.