Thursday, October 4, 2018

Federal Regulators Issue Statement on Sharing Resources for BSA/AML Compliance

The financial regulatory agencies and the Financial Crimes Enforcement Network on October 3 issued a joint statement outlining how banks and credit unions may enter into collaborative arrangements to share resources in order to more effectively manage their Bank Secrecy Act and anti-money laundering obligations.

Collaborative arrangements described in this statement are most suitable to financial institutions with a community focus, less complex operations, and lower-risk profiles for money laundering or terrorist financing.

The agencies described several situations in which collaboration might be beneficial for financial institutions, such as conducting internal control functions, independent testing and BSA/AML training.

When entering into collaborative arrangements, banks and credit unions should carefully consider the arrangement in relation to their risk profile, ensure adequate documentation, consider legal restrictions, establish appropriate oversight mechanisms, and ensure that the arrangement is consistent with sound principles of corporate governance, the statement said.

The agencies added that “ultimately, each bank is responsible for ensuring compliance with BSA requirements” and that “sharing resources in no way relieves a bank of this responsibility.”

The National Credit Union Administration noted "[t]his may benefit some credit unions, especially smaller institutions which may find hiring or retaining staff with the necessary knowledge a challenge."

Read the statement.

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