Federal Agencies Issue Joint BSA/AML Statement

On July 6, 2022, the Fed, FDIC, FinCEN, NCUA, and OCC issued a joint statement on the “Risk-Based Approach to Assessing Customer Relationships and Conducting Customer Due Diligence.”  The statement says that it does not alter or establish new expectations to any existing law or regulations, but emphasizes that “no customer type presents a single level of uniform risk or a particular risk profile related to money laundering, terrorist financing, or other illicit financial activity.”  

The Joint Statement explains that banks’ Bank Secrecy Act and Anti-Money Laundering (BSA/AML) obligations neither prohibit nor discourage institutions from providing banking services to customers in any specific class or type and are encouraged to assess and mitigate risks based on customer relationships instead of declining to provide banking services to customers of a specific type.  Banks are required to adopt customer due-diligence procedures that: “(i) understand the nature and purpose of customer relationships for the purpose of developing a customer risk profile, and (ii) conduct ongoing monitoring to identify and report suspicious transactions and, on a risk basis, to maintain and update customer information.”

The Joint Statement also notes that while the FFIEC BSA/AML Examination Manual provides guidance to Banks on properly carrying out BSA/AML examinations, it does not itself establish any requirements, and any Section of the FFIEC Manual relating to risks associated with money laundering and terrorist financing is not meant to imply that banks should consider certain classes of consumers to be uniformly higher risk.