FinCEN Issues Proposed Rule To Strengthen And Modernize AML/CFT Programs For Financial Institutions

On June 28, 2024, the US Department of the Treasury's Financial Crimes Enforcement Network ("FinCEN") issued a notice of proposed rulemaking that would amend existing anti-money laundering/countering the financing of terrorism ("AML/CFT") program¹ regulations to require that financial institutions establish, implement and maintain effective, risk-based and reasonably designed AML/CFT programs with certain minimum components, including a mandatory risk assessment process (hereinafter, "Proposed Rule").² For purposes of the Proposed Rule, "financial institutions" include: banks; broker dealers; mutual funds; futures commission merchants ("FCMs") and introducing brokers in commodities ("IB-Cs"); insurance companies; money services businesses ("MSBs"); casinos and card clubs; dealers in precious metals, precious stones or jewels; operators of credit card systems; loan or finance companies; and housing government sponsored enterprises.³ In addition to