The updates focus on four steps in the examination process: The updates emphasize examiners should take a “risk-focused” approach to tailor the review of a regulated institution’s BSA/AML compliance program, meaning the examination should be tailored to the risk profile of that specific institution. �YN3m�L�Nk7��8ț�A�����EWEg%�C�gu�4��fQ%� 4`�����@�ن;��`���dPECC�E�h`�h`��`��h` R,@�����T#a� �20�40U��Y���:X! profiles, working papers, and state banking performance created by the Congress to maintain stability and public confidence in the At the bottom of the screen, the user can link to a page containing all of the Examination Procedures available for single or multiple download. BSA/AML professionals have been anxiously waiting revisions to the 2014 BSA/AML Examination Manual (Exam Manual) published by the Federal Financial Institutions Examination Council (FFIEC), the interagency body comprised of federal banking regulatory agencies. Financial institutions will also benefit from this training and examination information. Public Information Center, 3501 Fairfax Drive, E-1002, FFIEC BSA/AML InfoBase. bankers, analysts, and other stakeholders. 1369 0 obj <> endobj As we previously blogged here, here, and here, collaborative arrangements and shared resources have a been a topic of discussions as the financial regulatory agencies attempt to modernize the BSA/AML system. BSA/AML Examination Manual Section List and Download Options. During this webinar, we’ll examine the updates to the manual and take a look at what your organization can do to prepare for their 2020 BSA… For sections with examination procedures, the "Online" link under "Examination Procedures" allows you to view the examination procedures online. To view specific sections of the manual, select within the left column. :@:92 J@R����h���̞a@��y�Q���})������Xy��3�85�h�eZ�kiF ����� The long-term goal of the InfoBase is to provide just-in-time training for new regulations and for other topics of specific concern to examiners within the FFIEC's member agencies: Board of Governors of the Federal Reserve System, Federal Deposit Insurance Corporation, National Credit Union Administration, Office of the Comptroller of the Currency, Consumer Financial Protection Bureau and the State Liaison Committee. © 2020 Compliance Cohort LLC. performed depend on the BSA/AML risk profile of the banking organization, the quality and quantity of independent testing, the financial institution’s history of BSA/AML compliance, and other relevant factors. Compliance Cohort LLC assumes no responsibility for use of (or errors and omissions in) any of the information on this site or related resources. Designation of an individual or individuals responsible for coordinating and monitoring day-to-day compliance (BSA compliance officer). JavaScript must be enabled in your browser in order to use some functions. Assessing the. Members get even more free videos, articles, and other resources on all topics of regulatory compliance. banking industry research, including quarterly banking Notably, “[i]f the bank’s independent testing is adequate, findings from the independent testing may be leveraged to reduce the examination areas covered and the testing necessary to assess the bank’s BSA/AML compliance program.”  To determine the adequacy, the examiner should consider whether testing was independent – which the Manual later clarifies could include testing “conducted by the internal audit department, outside auditors, consultants, or other qualified independent parties,” or “bank staff who are not involved in the function being tested.”  The examiner should also consider “whether the independent audit assessed all appropriate [Money Laundering/ Terrorist Financing (“ML/TF”)] and other illicit financial activity risks within the bank’s operations, and consider whether access was provided to the appropriate independent testing scope and supporting workpapers.”. encrypted and transmitted securely. supervises financial institutions for safety, soundness, and consumer Guidance to examiners on risk-focused supervision and developing the examination plan. The FDIC is proud to be a pre-eminent source of U.S. The Manual also instructs examiners that there is no requirement for risk assessment updates on a continuous or specified periodic basis, but these updates may occur as necessary to align the risk assessment with a significant change in a bank’s risk profile. Guidance to examiners on reviewing the bank's BSA/AML risk assessment process. This should be commensurate with the risk profile of the bank. conferences and events. Examiners should “discuss with the bank their preliminary conclusions, which may include strengths, weaknesses, any deficiencies or violations, if applicable, and necessary remediation of any deficiencies or violations.”  The final findings regarding the adequacy of the bank’s BSA/AML compliance program should be summarized in written format for inclusion in the report of examination (ROE). We are not attorneys and the information on this site should not be taken as legal advice - they are opinions of the author only. To learn more about Ballard Spahr’s Anti-Money Laundering Team, please click here. The Federal Financial Institutions Examination Council (FFIEC) is updating several sections and related examination procedures in the FFIEC Bank Secrecy Act/Anti-Money Laundering (BSA/AML) Examination Manual. The Manual updates emphasize the board of directors’ role in ensuring the compliance officer is fully supported with “appropriate authority, independence, and access to resources to administer an adequate BSA/AML compliance program based on the bank’s ML/TF and other illicit financial activity risk profile.”, The Manual updates emphasize the board of directors’ role in ensuring the compliance officer is fully supported with “appropriate authority, independence, and access to resources to administer an adequate BSA/AML compliance program based on the bank’s ML/TF and other illicit financial activity risk profile.”, Importantly, examiners are instructed that the “[i]ndicators of independence include but are not limited to: clear lines of reporting and communication ultimately up to the board of directors or a designated board committee that do not compromise the BSA compliance officer’s independence, the ability to undertake the BSA compliance officer’s role without undue influence from the bank’s business lines, reporting of issues to senior management and the board of directors.”. The "Online" link under "View" allows you to see the selected section online. To view specific sections of the manual, select within the left column. Guidance to examiners on money laundering and terrorist financing risks associated with products, services, customers, and geographic locations. FFIEC BSA/AML Examination Manual 5 April 2020 assessed all appropriate ML/TF and other illicit financial activity risks within the bank’s operations. For more information on any topic discussed on this site, seek legal counsel. Access FDIC Financial Institution Letters (FILs) on the Paper copies of FDIC FILs may be obtained through the FDIC's 1381 0 obj <>stream BSA/AML InfoBase (Bank Secrecy Act/Anti-Money Laundering) IT Handbook InfoBase ; QIS-4; Appraisal Subcommittee; Maintained by the FFIEC. BSA Compliance Officer, Interagency Statement on Risk-Focused Bank Secrecy Act/Anti-Money Laundering Supervision Keep up with FDIC announcements, read speeches and Bank Secrecy Act/Anti-Money Laundering (BSA/AML) Examination Manual (Manual) that provide instructions to examiners when assessing the adequacy of a bank’s BSA/AML compliance program. If appropriate, review the bank’s policies, procedures, and processes for complying with Office of Foreign Assets Control (“OFAC”)-administered laws and regulations. As the FFIEC Interagency press release described, the Manual provides “instructions to examiners when assessing the adequacy of a bank’s BSA/AML compliance program.” The “release of the updated sections provides further transparency into the BSA/AML examination process and does not establish new requirements.” The press release further stated the revisions were made to, among other objectives, emphasize examiners should be “tailoring BSA/AML examination to a bank’s risk profile,” to “ensure language clearly distinguishes between mandatory regulatory requirements and supervisory expectations” for examiners, and to “incorporate regulatory changes since the last update of the Manual in 2014.”, The Federal Deposit Insurance Corporation (“FDIC”) also issued a press release regarding the updates. The compliance program must meet following requirements: The Manual updates provide detailed considerations for each category. FFIEC updated the BSA examination manual for the first time since 2014. See our legal notice for more information. The revisions also incorporate regulatory changes since the last update of the Manual in 2014. manages receiverships. Prompt delivery of introductory, reference, and educational training material on specific topics of interest to field examiners from FFIEC members, Procedures that provide guidance to examiners for carrying out BSA/AML and OFAC examinations, Additional resources published by FFIEC members, FinCEN, and OFAC. changes for banks, and get the details on upcoming Fourth, the BSA/AML training program should 1) cover the aspects of the BSA that are relevant to the bank and its risk profile and 2) be provided to appropriate personnel (including those whose duties require knowledge of or relate to BSA/AML compliance), BSA compliance officer and staff, and the board of directors and senior management. The Manual states the bank and examiner should consider, for example, “the number and dollar amount of domestic and international funds transfers, the nature of private banking customers or foreign correspondent accounts, the existence of payable through accounts, and the domestic and international geographic locations where the bank conducts or transacts business.”, The bank may need to update its BSA/AML risk assessment “when new products, services, and customer types are introduced or the bank expands through mergers and acquisitions.”  However, the Manual clarifies “there is no requirement to update the BSA/AML risk assessment on a continuous or specified periodic basis.”, The Manual cautions “[i]mproper identification and assessment of risk can have a cascading effect, creating deficiencies in multiple areas of internal controls and resulting in an overall weakened BSA/AML compliance program.”, If the bank has not developed a BSA/AML risk assessment, the examiner must develop one for the bank based on available information, though the expectation is that the “examiner-developed BSA/AML risk assessment generally is not as comprehensive as one developed by the bank.”. FFIEC Bank Secrecy Act/Anti-Money Laundering InfoBase, Developing Conclusions and Finalizing the Exam, Assessing Compliance with BSA Regulatory Requirements, Risks Associated with Money Laundering and Terrorist Financing, Beneficial Ownership Requirements for Legal Entity Customers, Currency Transaction Reporting Exemptions, Purchase and Sale of Monetary Instruments Recordkeeping, Foreign Correspondent Account Recordkeeping, Reporting and Due Diligence, Private Banking Due Diligence Program (Non-U.S. The SLC includes representatives from the Conference of State Bank Supervisors, the American Council of State Savings Supervisors, and the National Association of State Credit Union Supervisors. Federal government websites often end in .gov or .mil. the official website and that any information you provide is On April 15, 2020, the Federal Financial Institutions Examination Council (“FFIEC”) released updates to the Bank Secretary Act/Anti-Money Laundering (“BSA/AML”) examination manual (the “Manual”). If you haven't done so already, make sure you sign up for our free membership where you get access to many member-only videos, articles, and other resources. Guidance to examiners on assessing the bank’s BSA/AML compliance program. Is your organization ready for an emphasized risk-based approach to BSA/AML supervision?


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