Aug 28

FinCEN Issuance

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The Financial Crimes Enforcement Network (FinCEN), the bureau within Treasury responsible for implementing the Bank Secrecy Act (BSA) and for anti- money laundering (AML) matters, issued an advisory to U.S. financial institutions on the need to promote a culture of compliance within their institutions.

The issuance is fairly straight-forward, but emphasizes the need for the Board of Directors and senior management of financial institutions to be cognizant of the importance of complying with BSA, the need for them to establish a “culture of compliance,” the need for everyone in the institution to receive adequate training, the need to have qualified staff, and the need to have an independent audit of the institution’s BSA compliance efforts.

The Board of Directors and senior management of a financial institution need to set the example for the rest of the institution when it comes to compliance and need to ensure that “efforts to manage and mitigate BSA/AML deficiencies and risks are not compromised by revenues interests.

In other words, a financial institution should not sacrifice compliance just to enhance profits – it will often backfire on the institution in terms of fines and adverse publicity. In promoting adequate BSA/AML compliance, it is also important to have strong, independent advisors and consultants.


Author: Bob Pasley