This communication updates the FinCEN Notification COVID-19 of March 16, 2020. There is additional information to help financial institutions meet their obligations regarding the BSA (Bank Secrecy Act) during the COVID-19 pandemic, as well as Direct contact form for urgent matters related to COVID-19 announced. FinCEN recognizes that financial institutions face major challenges related to the COVID-19 pandemic. Together, it is committed to promoting the success of the Coronavirus Economic Aid, Relief and Security Act (CARES Act). Therefore, FinCEN will post more information, as appropriate, as the CARES Act is implemented and questions arise.
Compliance with BSA obligations
Compliance with the BSA (Bank Secrecy ACT) remains critical and important in protecting our national security by combating money laundering and related crimes, including terrorism and the financing of any illegal activity. It is important that all financial institutions continue their risk-based approach and uphold their obligations to the BSA, as well as taking steps to safeguard employees and their families in response to combating the current COVID-19 pandemic. Due to the pandemic, numerous challenges have been created to meet certain obligations, including timely reporting and BSA requirements. Therefore, FinCEN will continue to contact the different regulatory entities and financial institutions to ensure compliance with the BSA and will issue additional new information as appropriate.
Requirements for collecting beneficial ownership information for existing customers
One of the main components of the CARES Act is the Paycheck Protection Program (PPP). For federally insured eligible deposit institutions and federally insured credit unions, PPP loans for existing clients will not require further verification under applicable BSA requirements, unless the institution’s risk-based BSA compliance approach indicate otherwise.
For non-PPP loans, FinCEN reminds financial institutions of the FinCEN ruling of September 7, 2018 (FIN-2018-R004) that offers some exceptional relief to the requirements of beneficial owners. To the extent that the renewal, modification, restructuring or extension for clients of existing legal entities is beyond the scope of that decision, FinCEN recognizes that a risk-based approach taken by financial institutions may cause reasonable delays in compliance.
FinCEN will continue to evaluate reasonable risk-based approaches to BSA obligations and will issue more information, as appropriate, particularly as the CARES Act is implemented.
Mandatory BSA reports and updates for the presentation of CTR (Currency Transaction Report)
FinCEN has obtained information from certain financial institutions about difficulties in meeting certain BSA obligations, including time requirements for certain reporting. In response to these concerns, FinCEN recognizes that certain regulatory time requirements regarding BSA reporting can be difficult during the COVID-19 pandemic and that there may be some reasonable delays in compliance. For this reason, FinCEN suspends the implementation of the resolution of February 6, 2020 (FIN-2020-R001) on the filing obligations of CTR by reporting transactions involving sole proprietors and entities that operate under a “DBA” name (the “2020 Ruling”) until further notice. Subsequently, more information on CTR reporting will be indicated at an appropriate time with reasonable implementation periods.
Until new information is issued, financial institutions must continue to report transactions involving sole proprietors and DBAs under prior practice. Financial institutions that have already made the necessary changes to comply with 2020 Ruling do not need to return to previous practice and can report CTRs in accordance with the decision now suspended.
New FinCEN COVID-19 online contact mechanism
It is important to note that FinCEN has created a specific online contact mechanism for COVID-19, through a specific drop-down category, for financial institutions to communicate with concerns related to FinCEN COVID-19 while complying with their BSA obligations. Financial institutions wishing to report such COVID-19 related concerns to FinCEN should go to www.fincen.gov/contact and select “COVID19” from the dropdown list under “Subject”. FinCEN will review COVID-19 related communications, however, due to the high number of such communications, FinCEN can only respond through an automated message confirming receipt of communications. Finally, financial institutions are encouraged to keep FinCEN and its functional regulators or other BSA examining authority informed as their circumstances change.
Encourage innovative efforts and other reminders
FinCEN encourages financial institutions to responsibly consider, evaluate, and implement innovative approaches to meet their BSA / anti-money laundering compliance obligations, to further strengthen the financial system against illicit financial activity and other fraud. related. In addition, FinCEN reminds financial institutions of the Joint Statement of December 3, 2018, on innovative efforts to combat money laundering and terrorist financing issued by the Board of Governors of the Federal Reserve System, the Federal Insurance Corporation of Deposits, FinCEN, the National Administration of Credit Cooperatives, and the Office of the Comptroller of the Currency.
As stated in Notice COVID-19 of March 16, FinCEN, financial institutions are reminded to review the information of other relevant regulatory entities as updates become available, and they are also alerted to fraud, investment, and investment scams. products and use of inside information. Financial institutions are advised to remain alert to malicious or fraudulent transactions similar to those that occur after natural disasters, such as those described in FinCEN’s notice, FIN-2017-A007, “Advice to Financial Institutions on Disaster-Related Fraud”, including benefit fraud, charity fraud, and cyber fraud. FinCEN will continue to monitor the National Emergency COVID-19 and will disclose updated information to financial institutions as appropriate.
