Bank Secrecy Act
Since 1970, Congress has enacted multiple measures to hinder criminals’ ability to launder money. The foundation of it all is the Bank Secrecy Act (BSA), which requires traditional banks, credit unions and thrifts, as well as such non-bank financial institutions as securities dealers and money services businesses, to keep specific records of events that could signal the occurrence of money laundering.
The Financial Crimes Enforcement Network (FinCEN) is the administrator of the BSA. Over the years, the BSA has been strengthened through subsequent anti-money laundering (AML) laws. This includes parts of the USA PATRIOT Act which focus on money laundering in the form of terrorist financing.
Financial institution BSA/AML compliance demands strong risk assessment and control of activities typically associated with money laundering. Bank Secrecy Act regulations require financial institutions to strictly record and/or report on cash purchases of negotiable instruments, cash transactions exceeding $10,000, and suspicious activity that might indicate money laundering, tax evasion or other crimes. Failure to do so risks reputational damage and civil money penalties. Assess your compliance with BSA/AML to determine your software and assessment needs.