Congress’s passage of a measure requiring startup companies — instead of their banks — to identify true owners was arguably the industry’s biggest legislative achievement in 2020. Now the industry is urging lawmakers to revisit proposals that would ease other anti-money-laundering reporting requirements.
The agency said it may exempt certain institutions from having to file suspicious activity reports if they have “innovative solutions intended to meet Bank Secrecy Act requirements more efficiently and effectively." But in those circumstances, law enforcement may still require SARs.
Banks are responsible for reporting their business customers' beneficial owners, but a bill that would shift that anti-money-laundering duty to businesses themselves has been added to a must-pass defense spending package.
Big financial institutions are worried that online wagers made with credit cards pose a heavy risk of money laundering. The possibility of tougher rules under the incoming Biden administration has only compounded their concerns.
The two agencies proposed amending the Bank Secrecy Act to lower the threshold for transfers occurring outside the U.S. that trigger recordkeeping requirements.
Better dialogue between banks and authorities coupled with stronger anti-money-laundering measures could help address the suspicious activity report flaws revealed by investigative journalists.
U.S. banks and credit unions reported skyrocketing levels of suspected business-loan fraud last month, a period that coincided with growing awareness of scams involving government small-business aid programs.
Artificial intelligence, machine learning and enhanced data sharing among lenders could go a long way toward spotting suspicious patterns in daily financial activity and bad actors, experts say.
