What’s Happening: The Bank Policy Institute commented late yesterday on the Financial Crimes Enforcement Network’s proposed pilot program that would temporarily allow U.S. financial institutions to share reports identifying possible illicit financial activities with foreign branches, subsidiaries and affiliates. Sharing this data will help banks operating transnationally to identify advanced criminal enterprises and better manage illicit finance risks.
Here’s What BPI is Saying: “FinCEN’s pilot program acknowledges that financial crime is borderless and seeks to eliminate existing barriers that prevent information sharing between U.S. banks and their overseas counterparts,” stated Angelena Bradfield, BPI senior vice president, AML/BSA, sanctions and privacy. “Allowing banks to share these reports would improve their ability to identify and prevent money laundering across the globe.”
What Does BPI Recommend?
To encourage participation in the pilot, FinCEN should implement the following measures:
- Extend the program’s duration to give banks enough time to create new compliance processes. Many compliance methods will be manual given that the program is temporary, and failure to provide adequate time could disincentive participation or result in insufficient data;
- Require reporting on a semiannual, rather than a 90-day reporting cycle to enhance and streamline reporting;
- Give banks more instructions on how to handle key aspects of the program, including what happens when the program ends and how to handle suspicious activity reports related to sensitive national security matters; and
- Coordinate with the federal banking regulators to confirm supervisory expectations.
Go deeper: To access a copy of the letter, please click here.
About Bank Policy Institute.
The Bank Policy Institute (BPI) is a nonpartisan public policy, research and advocacy group, representing the nation’s leading banks and their customers. Our members include universal banks, regional banks and the major foreign banks doing business in the United States. Collectively, they employ almost 2 million Americans, make nearly half of the nation’s small business loans, and are an engine for financial innovation and economic growth.