FinCEN seeks comments on enhancing effectiveness of AML programs

The Financial Crimes Enforcement Network (FinCEN) issued an Advance Notice of Proposed Rulemaking (ANPRM) to solicit public comment on a wide range of questions pertaining to potential regulatory amendments under the Bank Secrecy Act (BSA).

The proposals under consideration are intended to provide financial institutions greater flexibility in the allocation of resources and greater alignment of priorities across industry and government, resulting in the enhanced effectiveness and efficiency of anti-money laundering (AML) programs.

FinCEN, in collaboration with its supervisory partners, law enforcement, and, where appropriate, the financial industry, has undertaken recent initiatives to collectively re-examine the BSA regulatory framework and the broader national AML regime.

As described in the ANPRM, in 2019, the congressionally established forum for industry, regulators, and law enforcement, known as the Bank Secrecy Act Advisory Group, created a working group to develop recommendations for strengthening the national AML regime by increasing its effectiveness and efficiency. This ANPRM is a result of FinCEN’s evaluation of those recommendations.

The ANPRM seeks comment on incorporating an “effective and reasonably designed” AML program component to empower financial institutions to allocate resources more effectively. This component also would seek to implement a common understanding between supervisory agencies and financial institutions regarding the necessary AML program elements, and would seek to impose minimal additional obligations on AML programs that already comply under the existing supervisory framework.

The potential regulatory amendments described in the ANPRM would make clear that an “effective and reasonably designed” program is one that:

  • assesses and manages risk as informed by a financial institution’s own risk assessment process, including consideration of AML priorities to be issued by FinCEN consistent with the proposed amendments,
  • provides for compliance with BSA requirements, and
  • provides for the reporting of information with a high degree of usefulness to government authorities.

In one of its innovation programs, FinCEN sets up meetings with fintech and regtech firms to understand new technologies and financial services-related solutions, as well as increase interactions with the firms creating them. Key themes include: artificial intelligence/machine learning and natural language processing; virtual currencies and other blockchain applications; digital identity; secure and confidential information sharing, among others.

The ANPRM also seeks comment on proposals to impose an explicit requirement for a risk assessment process and for the Director of FinCEN to issue a list of national AML priorities, to be called FinCEN’s Strategic Anti-Money Laundering Priorities, every two years.


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