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On December 2, 2014, the Federal Financial Institutions Examination Council (“FFIEC”) released the revised Bank Secrecy Act/Anti-Money Laundering (BSA/AML) Examination Manual. The 2014 BSA/AML examination manual incorporates several regulatory changes and provides further clarity on regulatory expectations since the last examination manual was released in 2010.
So what are some of the new changes?
There are several areas within the new examination manual that have incorporated current regulatory requirements.
- Suspicious Activity Reporting (“SAR”) – Incorporated new SAR E-Filing requirements; guidance on the extension of SAR filing for continuing activity, clarification of prohibitions on disclosing a SAR, and guidance on sharing SARs with affiliates.
- Currency Transaction Reporting (“CTR”) – Revised to incorporate new CTR E-Filing requirements and new guidance issued by FinCEN since 2010 related to currency transaction aggregation for businesses and exemptions.
- Foreign Correspondent Account Recordkeeping – Included regulations relating to the Comprehensive Iran Sanctions, Accountability, and Divestment Act.
- Foreign Bank and Financial Accounts (“FBAR”) – Incorporated new FBAR filing requirements.
- International Transportation of Currency or Monetary Instruments Reporting (“CMIR”) – Clarified monitoring and reporting obligations under the BSA for international transportation of currency or monetary instruments.
- Correspondent Accounts (Foreign) – Included additional guidance in the section on risk mitigation.
- Bulk Shipments of Currency – Revised to incorporate FinCEN’s CMIR guidance for common carriers of currency, including armored car services (August 1, 2014), and clarify monitoring and reporting obligations under the BSA.
- Automated Clearing House Transactions (“ACH”) – Incorporated National Automated Clearing House Association (“NACHA”), the Electronic Payments Association, modifications related to international ACH transactions and further defined third-party service providers.
- Prepaid Access – Replaced Electronic Cash section and included an expanded discussion of risk factors and risk mitigation related to prepaid access.
- Third-Party Payment Processors – Updated to reflect interagency guidance issued since 2010.
- Embassy, Foreign Consulate, and Foreign Mission Accounts – Updated to incorporate the interagency guidance on accepting accounts from foreign embassies, consulates, and missions.
- Nonbank Financial Institutions – Incorporated new FinCEN regulations for Money Services Businesses (“MSB”) related to certain foreign-located persons engaging in MSB activities; new regulations related to prepaid access programs; and guidance regarding virtual currency administrators and exchangers.
As the FFIEC BSA/AML Examination Manual is the “Bible” of BSA/AML compliance, we urge your institution to review its BSA/AML policies and procedures and make any necessary changes to the control environment. Take some time and review your policies and procedures; conduct a gap analysis to see if any changes need to be made or controls need to be incorporated within your AML program. This will mitigate any risk of non-compliance and further reduce the likelihood of your auditors or examiners pointing out any gaps during the next independent review and regulatory examination.