Alert August 19, 2014

FinCEN Issues Advisory to U.S. Financial Institutions Regarding Promotion of a Culture of Compliance

The Financial Crimes Enforcement Network (“FinCEN”) issued an advisory (the “Advisory”) to U.S. financial institutions (“FIs”, and each an “FI”) in which FinCEN highlights “the importance of a strong culture of [Bank Secrecy Act (BSA)/Anti-Money Laundering (AML)] compliance for senior management, leadership and owners of all FIs subject to FinCEN’s regulations regardless of size or industry sector.”  FinCEN states that it issued the Advisory in response to the significant recent civil and criminal enforcement actions against banks for shortcomings in their BSA/AML compliance programs and deficiencies with respect to leadership and organizational focus regarding implementation of such programs.  FinCEN stresses that while the Advisory provides guidance on how an FI may strengthen its BSA/AML compliance program, the Advisory does not change existing obligations under BSA/AML requirements nor reflect a new, higher level of regulatory expectations than those that already existed under applicable law and regulation.

The Advisory then discusses ways in which an FI can strengthen its BSA/AML compliance culture:

  • By having engaged leadership that supports the FI’s BSA/AML compliance program;
  • By seeing that the FI’s BSA/AML compliance program is not compromised by revenue interests;
  • By sharing relevant BSA/AML information throughout the FI’s organization;
  • By having the FI’s leadership provide adequate human and technological resources to support the BSA/AML program;
  • By having the FI’s BSA/AML program tested by an independent and competent party; and
  • By making certain that the FI’s leadership and staff understand the purpose of the BSA/AML program and the manner in which the BSA/AML reports are used and effectively work to assist law enforcement authorities in fighting criminal and terrorist activities.