NCUA, Banking Regulators, Clarify Bank Secrecy Act, Anti-Money Laundering Enforcement

Financial institutions are unlikely to face official enforcement actions if they commit small, isolated violations of the Bank Secrecy Act or Anti-Money Laundering rules, federal banking regulators, including the National Credit Union Administration, said last week.

“Isolated or technical violations or deficiencies are generally not considered the kinds of problems that would result in an enforcement action,” the regulators said in a pair of statements they said were intended to clarify issues for financial institutions. The two statements were jointly issued by the Board of Governors of the Federal Reserve, the Federal Deposit Insurance Corporation, the National Credit Union Administration and the Office of the Comptroller of the Currency,

In the statements, the regulators indicated that enforcement actions for “deficiencies” that are discovered during an examination of a financial institution will be tailored to each institution. They added that when areas of concern are uncovered, the regulators may communicate those concerns by “formal and informal means.”

“The particular method of communication used typically depends on the seriousness of the concerns and each agency’s policies,” the regulators said.

For instance, regulators are likely to issue cease and desist orders when examiners find that a previously identified problem with an institution’s BSA/AML compliance program has not been corrected.

On the other hand, if examiners find problems with an institution’s training procedures, they may subject an institution to “examiner criticism” or other supervisory action, according to the statements.

The regulators said they will sanction financial institutions for violations of the rules involving Suspicious Activity Reports if the violations are systemic or “egregious.”


Federal Reserve, FDIC, NCUA, OCC Joint Statement on Enforcement of BSA/AML Requirements

NCUA Press Release: Federal Banking Agencies Issue Joint Statement on Enforcement of Bank Secrecy Act/Anti-Money Laundering Requirements

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