FinCEN Seeks Input On Modernizing BSA Regulations – Finance and Banking

FinCEN issued a request for information seeking
feedback on ways to “streamline, modernize, and update”
AML and countering the financing of terrorism regulations and
guidance under the Bank Secrecy Act.

Under Section 6216 of the Anti-Money Laundering Act of 2020, FinCEN is
required to review the BSA regulatory regime to ensure there are
cost-effective and efficient “safeguards” shielding the
U.S. financial system from financial crimes, such as money
laundering and the financing of terrorism and proliferation. The
review also helps ensure that the information FinCEN collects from
covered entities is “highly useful in countering financial
crime.”

Accordingly, FinCEN is seeking feedback on, among other things,
whether:

• there are shortcomings in BSA guidance and regulations in
  addressing threats to the financial system or national
  security;




• the current reporting and recordkeeping requirements collect
  information that is “highly useful in countering financial
  crime”;




• there are BSA requirements that are obsolete, redundant,
  inefficient, or no longer fulfill their original purpose; and




• there are BSA requirements that fail to conform, or do not
  fully implement international standards, such as Financial Action
  Task Force Recommendations.

Comments in response to the RFI for Information are due on or
before February 14, 2022.

Commentary – Jodi Avergun

Today, FinCEN took another step in complying with the many
requisites imposed on it by the Anti-Money Laundering Act of
2020.  FinCEN’s request for information as to how the BSA
can be improved to either better address the risks posed by money
laundering or eliminate outdated or redundant regulations provides
an opportunity for financial institutions to make constructive
suggestions to FinCEN from a pragmatic, industry-based perspective
about effective intelligence gathering and reporting. Given
the vast increase in the volume and size of financial transactions
and the more effective analytical tools that financial institutions
now possess compared to when most of the regulations were drafted
in the post-9/11 era, suggestions are likely to be prolific, and
are likely to range from the easy (increase the Currency
Transaction Report and Form 8300 reporting threshold) to the
unlikely (eliminate the Suspicious Activity
Reporting narrative section requirement as too time-consuming
and inconsistently applied). 

Primary Sources

1. FinCEN Request for Information and Comment: Review
   of Bank Secrecy Act Regulations and Guidance (86 FR
   71201)

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