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ARTICLE · 25 AUGUST 2020

NFA OKs FinCEN CDD FAQ

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More enforcement actions may well be on the way for firms that have not effectively implemented an adequate AML program.

United StatesFinance and Banking
Christian Larson
Christian Larson
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NFA recommended that its member futures commission merchants and introducing brokers ("FCMs and IBs") review FinCEN's recently issued FAQ concerning customer due diligence ("CDD") in order to ensure that their AML programs meet CDD-related regulatory obligations. As previously covered, FinCEN's recent guidance addressed the (i) collection of customer information, (ii) creation of customer risk profiles, and (iii) requirements to perform ongoing monitoring of customer relationships.

Commentary

Notwithstanding this article's fun string of acronyms, FCMs and IBs would do well to note that this NFA guidance comes on the heels of the CFTC's first-ever enforcement action under its AML rules. More enforcement actions may well be on the way for firms that have not effectively implemented an adequate AML program.

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