WASHINGTON—A number of federal departments and agencies, including NCUA, have issued a statement to address instances in which certain banks and credit unions may decide to enter into collaborative arrangements to share resources to manage their Bank Secrecy Act (BSA) and anti-money laundering (AML) obligations more efficiently and effectively.
NCUA, along with other federal depository institutions regulators and the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN), said collaborative arrangements as described in the statement generally are most suitable for financial institutions with a community focus, less complex operations, and lower-risk profiles for money laundering or terrorist financing.
The statement explains how these institutions can share BSA/AML resources in order to better protect against illicit finance risks, which can in turn also reduce costs. According to the federal agencies, the joint statement is a result of a working group recently formed by these agencies and Treasury’s Office of Terrorism and Financial Intelligence aimed at improving the effectiveness and efficiency of the BSA/AML regime.
“This joint statement is part of a broader effort to work closely with our regulatory partners to strengthen the anti-money laundering defenses across the U.S. financial system,” said Sigal Mandelker, Treasury Under Secretary for Terrorism and Financial Intelligence. “The joint statement allows community-focused banks and credit unions to share certain anti-money laundering resources in order to better protect against illicit actors seeking to abuse those types of institutions. Such resource sharing must be approached with careful due diligence and thorough consideration of the risks and benefits.”
Among other things, the agencies said the joint statement aims to:
- Highlight the potential benefits of collaborative arrangements that pool resources, such as staff, technology, or other resources, to increase operational efficiencies, reduce costs, and leverage specialized expertise; and
- Outline risk considerations and mitigation measures associated with the use of collaborative arrangements.
The joint statement also acknowledges that banks and credit unions may benefit from using shared resources to manage certain BSA/AML obligations more efficiently and effectively. However, it notes that financial institutions should approach the establishment of collaborative arrangements like other business decisions, with due diligence and thorough consideration of the risks and benefits.
Credit unions, along with banks, are being encouraged to contact their primary federal regulator with questions regarding sharing BSA resources, and should refer to other relevant guidance.
In addition to NCUA, the statement was issued by the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, FinCEN, and the Office of the Comptroller of the Currency,