FinCEN Proposes AML Regulations for Investment Advisers

FinCEN Proposes AML Regulations for Investment Advisers
On August 25, 2015 FinCEN proposed AML regulations for Investment Advisers that continue the path traced by FinCEN Director Jennifer Shasky Calvery to identify and correct AML deficiencies in areas previously ignored despite identified risks.   If adopted, the requirements proposed for Investment Advisers would mirror those imposed on other financial service providers.


 We note that not all Investment Advisers have been lacking in the AML control area.  Some, including some Optima clients, have opted to proactively apply controls that they felt were required by the risks they identified in their individual operations.  As a whole, FinCEN’s proposed rule will level the playing field between Investment Advisors and other institutions and within the Investment Adviser sector itself.   If history can be relied upon to predict the future,  the rule will also create a more secure financial system, although some Investment Advisers experience growing pains in the process.


FinCEN’s Official Announcement


The Financial Crimes Enforcement Network (FinCEN) today proposed a rule requiring certain investment advisers to establish anti-money laundering (AML) programs and report suspicious activity to FinCEN pursuant to the Bank Secrecy Act (BSA). FinCEN also proposed to include investment advisers in the general definition of “financial institution,” which, among other things, would require them to file Currency Transaction Reports (CTRs) and keep records relating to the transmittal of funds.


 News Release:

 Proposed Rule: