FinCEN Issues Guidance On Ransomware Attacks

Executive Summary:  Ransomware is a cyber-attack in which malicious software blocks access to systems or data to extort payment in exchange for restoring access to information systems and data. Due to the proliferation of ransomware attacks, on October 1, 2020, the Department of the Treasury's Financial Crimes Enforcement Network ("FinCEN") issued an Advisory providing financial institutions with guidance on ransomware trends, red flags and reporting, and sharing of information to help in identifying and handling ransomware-related transactions. Financial institutions may wish to calibrate their anti-money laundering ("AML") compliance programs to ensure they address the full scope of risks associated with ransomware attacks, including risks arising from third-party intermediaries and virtual currency exchangers. The Department of the Treasury's Office of Foreign Assets Control separately issued parallel guidance concerning sanctions risks associated with ransomware.