BSA/AML Updates

Be sure to JOIN US on January 7, 2021, for our webinar, “BSA/AML New Year Update”. 

In November, we received some BSA guidance in the form of a joint fact sheet related to the due diligence requirements and expectations for charities and nonprofit organizations. This is something that was a long time coming and the response was related to the COVID-19 pandemic.  There were a lot of charities and nonprofit organizations that were having difficulty obtaining banking services because they were higher risk from a BSA perspective.  Why is that?

Click on the video to listen to Kevin explain more.

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BSA Charity

On November 19, 2020, the Agencies issued a Joint Fact Sheet on Bank Secrecy Act Due Diligence Requirements for Charities and Non-Profit Organizations (Joint Statement).  The intent of the Joint Statement was to provide clarity to financial institutions in determining how to handle charities and other non-profit organizations (NPOs) from a customer due diligence (CDD) perspective.  As a result of the 2016 CDD Final Rule, some charities reported difficulty obtaining and maintaining banking services, so this Joint Statement provides a little more clarity on what exactly the expectations are. 

It is important to note that the new guidance does not change any requirements under the Bank Secrecy Act. 

The Joint Statement does emphasize –

the U.S. government does not view the charitable sector as a whole as presenting a uniform or unacceptably high risk of being used or exploited for money laundering, terrorist financing (ML/TF), or sanctions violations.” 

There are of course risks that need to be evaluated, but they vary depending upon the circumstances surrounding the individual NPO.  This statement is also consistent with the general theme that banks should mitigate and manage their relationships as opposed to closing accounts to avoid risk in general.

In general, financial institutions are required to apply a risk-based approach to CDD and develop risk profiles for all their customers, including NPOs.  Depending upon the facts and circumstances for each individual relationship, NPOs should be evaluated for their particular ML/TF risk and the CDD should be modified as appropriate.  Numerous factors can impact the risk associated with an NPO and the guidance provides a list of things to take into account when assessing the risk.  The Joint Statement includes a listing of customer information that could be useful in establishing the customer risk profile as well as resources for evaluating specific organizations.

If you need training on BSA-related topics, we have several webinars coming up in the coming months as well as, a wide variety available OnDemand.

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BSA Board Training

bsa aml training for bankers

Be sure to JOIN US on December 10, 2020, for our webinar, “Annual BSA/AML Management & Board”. 

Doing annual BSA/AML training for your Board members can often feel like you’re in the movie Groundhog Day.  They’re probably thinking, “Haven’t we done this before?”  The key is to keep things fresh and interesting, as well as, relevant.  While your front-line people need to know when to do things, how to do things, etc. (aka the nuts and bolts), your Board, just needs a general understanding of the requirements and risks without all the specific details.  They need a 10,000 foot-view.  We’d love to be your solution!

This webinar will focus only on what your Board needs to know.  The best part?   The comprehensive plain English training manual and free recording!  You can listen to the recording all at once or play it in small chunks over the course of several months for your Board members.  It’s up to you!


BSA/AML Conference OnDemand

On November 10th, we hosted our virtual BSA/AML Compliance Conference.  This wrapped up our Fall Conference series and we can’t thank you enough!  All three conference (Deposits, Lending, and BSA/AML) we’re a huge success!  Here is some of the feedback we received from the BSA/AML Conference:

  • Good information and a much different approach than I have received from other BSA seminars.
  • The BCC events are always informative and this continues that trend. Great job!
  • Informative and engaging and I thought the content was very pertinent to our job responsibilities.

If you missed the BSA/AML Conference, we wanted to let you know it is now available for purchase OnDemand.  You can also purchase the entire series for a reduced price.


BSA Board Training

Can you believe it’s already September?  Over half the year has passed, and most likely, a lot of that time has been spent working remotely and in virtual meetings.  Given all of the time and effort dedicated to managing through COVID-19 and this “new normal”, we want to remind you about your annual BSA Board training!

On April 3, 2020, the Financial Crimes Enforcement Network (FinCEN) provided further information in response to the Coronavirus Disease 2019 (COVID-19) pandemic.  While this release acknowledged the potential for CTR reporting delays (and delayed implementing the new CTR filing requirements for DBAs), there wasn’t grace granted for anything else. 

While the regulation doesn’t technically require “annual” Board BSA training per se, it has become an industry expectation.  The Board should be updated, at least annually, on BSA even if there are no changes.  We believe doing so is a good reminder to the Board of how important BSA is.  It also keeps BSA in the forefront, since the Board is ultimately responsible for BSA compliance.

Given the environment we’re in, with revisions to the BSA/AML Exam Manual, COVID-19 pandemic-related scams, and the unique and often remote operating environment, updating the Board to ensure their BSA knowledge remains sharp is critical.  Hint hint…those three things might be great additions to this year’s training, in addition to the general BSA requirements. 

Below are questions we find engaged Boards ask their BSA Officers, and are great to keep in mind when developing your Board training to ensure you’re providing them with the things they need to know to sufficiently execute their duties.  The answers to some of these may be found within your independent test, but there may have been updates to your program since then as well:

Are we doing the right things, and are we doing them well?  How do we compare to others?
Know what enforcement actions and penalties are being imposed.

Are we sufficient, competent and effective?
Is your program effective? Is suspicious activity being identified and referred /reported?

Are our program components properly positioned?
Are you devoting resources and staffing to those areas of greatest concern/risk?

Are we outsourcing and in-sourcing the right processes in line with our competencies and economies?  Are we properly managed and accountable in all cases?
If conducting an internal independent audit, should it be outsourced?  Should third-party vendors be used for OFAC, 314a, identity verification, etc.?

Top-down and bottom-up – is our program working as intended?
Is enough information being reported UP to the Board/Management so they can provide appropriate direction DOWN in the form of resources, authority, etc.?

Now is a great time to start thinking about your annual BSA Board training, if you haven’t already done so.  BSA is not something you want to let fall on the back burner during these unprecedented times.  If you need help or want more training, we have a wide variety of BSA-related webinars available On Demand.  We also have a webinar devoted specifically to annual BSA training for your Board & Management coming up on December 10, 2020. 

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