In the first half of 2018, financial regulators around the world imposed more than $1.7 billion in fines related to anti-money laundering (AML) compliance failures, nearly matching 2017’s annual total of $2 billion. More than $1 billion of that $1.7 billion originated from enforcement actions by U.S. regulators and prosecutors. If you have been asked to join the board of directors of a financial institution, you should be asking yourself two questions: “What do I need to know in order to effectively oversee and hold management accountable for complying with AML laws and regulations?” and “What questions should I be asking management and the chief compliance officer (CCO) about the company’s AML policies and U.S. sanctions programs?”
What Do I Need to Know?
While you may already know the basic requirements of AML regulations, such as the requirement to file currency transactions reports (CTRs) and suspicious activity reports (SARs), it’s worth taking a look at the Federal Financial Institutions Examination Council Bank Secrecy Act/Anti-Money Laundering Examination Manual (the FFIEC Manual). Originally created as a guide for bank examiners carrying out Bank Secrecy Act (BSA) and Office of Foreign Assets Control (OFAC) examinations, the FFIEC Manual provides an excellent overview of AML compliance program requirements, BSA/AML risks and risk management expectations.
