Financial Crime World

Congress Overhauls Anti-Money Laundering Framework with Sweeping Reforms

In a landmark move, Congress has passed the Anti-Money Laundering Act of 2020, aimed at modernizing and strengthening the United States’ anti-money laundering (AML) and countering the financing of terrorism (CFT) framework.

Comprehensive Legislation

The legislation directs various agencies within the Executive Branch to review existing requirements and explore means of streamlining AML/CFT enforcement. Key areas of focus include:

  • Reviewing Current Guidelines:
    • Reviewing Currency Transaction Reports (CTRs) guidelines
    • Examining dollar thresholds for Suspicious Activity Reports (SARs)
  • Reducing Reporting Burdens:
    • Reducing reporting burdens on non-profit organizations
  • Innovation and Cooperation:
    • Establishing a subcommittee on innovation, along with innovation officers
    • Convening a tech symposium
  • Enforcement Actions:
    • Reviewing no-action letters in enforcement actions

Each of these tasks will be accompanied by a formal report to Congress.

Promoting Public and Private Collaboration

The Treasury Department has been tasked with spearheading several programs to promote public and private collaboration, including:

  • FinCEN Exchange Program: Designed to facilitate information sharing between financial institutions, law enforcement agencies, national security agencies, and FinCEN
  • Stakeholder Convening: Convening private and public stakeholders to examine strategies for increasing cooperation between the public and private sectors

New Resources for AML/CFT Administration and Enforcement

To support these ambitious enforcement and modernization goals, Congress has provided new resources, including:

  • Treasury Financial Attaché Program
  • Foreign Financial Intelligence Unit Liaisons
  • BSA “Innovation Officers”
  • Information Security Officers, among others
  • Mandatory AML Training for Federal Bank Examiners

Impact on the AML/CFT Regulatory Regime

The Anti-Money Laundering Act of 2020 signals significant changes to the AML/CFT regulatory regime in the immediate future and coming years. While new reporting requirements will not be triggered for another three years for existing companies, new penalties, incentives for whistleblowers, and increased information sharing between public and private entities will quickly change the enforcement landscape.

Future Updates

As these changes unfold, we will continue to provide updates on any significant developments.