October 04, 2018

NAFCU engaged as regulators, Senate work on BSA/AML reforms

Capitol DomeUPDATE: The Senate Banking Committee has postponed today's "Combating Money Laundering and Other Forms of Illicit Finance: Regulator and Law Enforcement Perspectives on Reform." A rescheduled date is yet to be determined, but NAFCU will keep credit unions updated.

Ahead of today's Senate Banking Committee hearing on ways to modernize the Bank Secrecy Act (BSA) and anti-money laundering (AML) regime, federal depository institution regulators – including the NCUA – and the Financial Crimes Enforcement Network (FinCEN) issued a statement explaining how financial institutions can share BSA/AML resources to better protect against risks and reduce costs.

The statement said such arrangements "are most suitable for banks with a community focus, less complex operations, and lower-risk profiles for money laundering or terrorist financing." It further detailed how the collaboration would work, including internal controls, independent testing and training.

The statement is a result of a working group with the Treasury Department's Office of Terrorism and Financial Intelligence, which is working to improve the effectiveness and efficiency of the BSA/AML regime. NAFCU will review and keep credit unions informed on how it could impact their operations.

Also before today's hearing, NAFCU Vice President of Legislative Affairs Brad Thaler sent a letter to Senate Banking Committee Chairman Mike Crapo, R-Idaho, and Ranking Member Sherrod Brown, D-Ohio, to offer credit unions' perspective on BSA/AML modernization.

Specifically, Thaler encouraged the committee to "consider legislative efforts that combat money laundering but also provide credit unions with some regulatory relief." He pointed to two bills introduced in the House – the Financial Reporting Threshold Modernization Act and the Counter Terrorism and Illicit Finance Act – that NAFCU is supportive of.

In addition, Thaler highlighted provisions of S. 2155 that will impact credit unions' BSA requirements.

Today's hearing, "Combating Money Laundering and Other Forms of Illicit Finance: Regulator and Law Enforcement Perspectives on Reform," is slated to begin at 10 a.m. Eastern. FinCEN Director Kenneth Blanco, whom NAFCU met with in April, will testify along with officials from the FBI and Office of the Comptroller of the Currency.