Federal Bank Regulatory Agencies and FinCEN have issued a joint statement to further efforts around improving transparency for the risk-based approach to Bank Secrecy Act (BSA) and anti-money laundering (AML).
Leveraging a risk-focused approach it enables federal agencies to better tailor examination plans and procedures based on unique risk profiles of each bank.
Sigal Mandelker, Treasury Under Secretary for Terrorism and Financial Intelligence, said, “The risk-based approach to supervision enables banks to devote their compliance resources towards the areas of greater risk, making it more difficult for illicit actors to abuse our financial system.
“The statement highlights the continued work by Treasury and its regulatory partners to enhance the effectiveness and efficiency of our anti-money laundering regime.”
This statement was made by a working group established by the U.S. Department of the Treasury’s Office of Terrorism and Financial Intelligence and the Federal depository institutions regulators, the Financial Crimes Enforcement Network (FinCEN) and its regulatory partners.
Its statement outlines common practices for assessing a bank’s money laundering and terrorist financing risk profile. This better assists examiners in scoping and planning examinations and evaluating their compliance programs.
This approach means the agencies can allocate more resources to higher-risk areas and kess to low -risk areas for examinations.
FinCEN Director Kenneth A. Blanco said, “We recognize that not all financial institutions share the same risk profile, but we are working to ensure that regulators are following common processes for assessing compliance. Proper management of money laundering and terrorist financing risk helps to safeguard our financial system, promotes national security, and protects our people from harm.
“This joint statement emphasizes our risk-based approach to supervision and intends to help provide greater clarity to banks and the public on the expectations of Federal bank regulatory agencies.”
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