FinCEN prepares an overhaul of AML and CTF rules

FinCEN prepares an overhaul of AML and CTF rules

By Sam Grant - min read
Image a money laundering concept: a dollar bill held by a peg hanging on a line

The financial crimes network is looking to revamp its counter-terrorist financing (CTF) and anti-money laundering (AML) regulations — potentially having an impact on the crypto industry 

The US Financial Crimes Enforcement Network (FinCEN) recently announced its plans to review and modify its AML and CTF regulations — a move that could have an impact on the whole financial landscape. Among the targeted areas is the modernisation of AML requirements for financial institutions. This will allow FinCEN to achieve a better response to the dynamic threats posed by “illicit finance”.

According to the announcement, the network will be collecting feedback from the public on the proposals. These regulatory proposals are aimed at reinforcing the rules steering the reporting requirements of the concerned financial organisations.

The forthcoming policies will seek to handle “the evolving threats of illicit finance, such as money laundering, terrorist financing and related crimes.” This means most crypto exchanges and firms will be under serious scrutiny in regards to the upcoming regulatory changes.

The policies will also affect the compliance obligations of other financial institutions such as mutual funds, insurance companies, banks, casinos and credit unions. Dealers/brokers of trading instruments like precious metals, precious stones, commodities and futures will also be in the sights of the regulatory changes.

The new AML regulations will seek to single out and take action against illegal financial activities. This will be achieved through solid book-keeping and risk assessment requirements.

“The regulatory amendments under consideration are intended to modernise the regulatory regime to address the evolving threats of illicit finance, and provide financial institutions with greater flexibility in the allocation of resources, resulting in the enhanced effectiveness and efficiency of anti-money laundering programs,” a section of the announcement read.

Currently, the regulatory network is said to be examining policy recommendations from the AML Effectiveness Working Group.