BSA

It looks like FinCEN is preparing to save some trees. FinCEN has proposed a rule to make the electronic filing of reports required under the Bank Secrecy Act mandatory. FinCEN  stated that the move will improve efficiency, reduce costs, and enhance the ability of its investigators, analysts, and examiners to review the  reports. The proposed rule is open for comments and if implemented, would require e-filing as of June 30, 2012.

I was out in Colorado conducting a BSA training session with Andrea last week and I have to say that I never get tired of looking at the mountains.  Maybe that is because Iowa is not known for its changes in elevation, but I think it is more because I am all about the beauties of Mother Nature.

One discussion that we had while in Colorado was the reasoning behind the discrepancy in CTR filing requirements. It seems strange that a credit union must list  all joint account holders on a CTR for deposits of currency greater than $10,000 but only list the individual/s conducting the transaction for a withdrawal of currency greater than $10,000.

Is your credit union taking advantage of voluntary information sharing? Section 314(b) of the USA PATRIOT Act (31 CFR 103.110) allows credit unions to share information in order to identify and report suspicious activities that may involve money laundering or terrorist activity.  Privacy laws and regulations  prevent a credit union from sharing useful information with other financial institutions to combat terrorism and money laundering. Now FinCEN encourages credit unions to complete the 314(b) form, which will allow financial institutions to share information for a one-year period. Often times other financial institutions hold information that can be beneficial when trying to determine an appropriate course of action on potentially suspicious activity. Completing the 314(b) form could be a valuable tool in your BSA compliance arsenal.

Here are some key points:

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FinCEN has been busy lately. Here is what’s new:

FinCEN announced yesterday that it is now allowing for electronic filing of MSB registrations and optional electronic filing of the FBAR Form. In an age where paperless is the new norm, it is nice to see that they jumping on board.

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I found this article posted in the Wall Street Journal to be very interesting.  It discusses how BSA and OFAC programs have played a major role in the war on terror. The article states that “initial moves after 9/11 froze 80% – 90%” of al Qaeda’s funds.  The hard work of financial institutions has forced terrorists like al Qaeda to use couriers instead of financial institutions, in order to move their funds around.

FinCEN released its “Advisory on Activities Potentially Related to Commercial Real Estate Fraud.” This release outlines some common types of reported suspicious activity with respect to commercial real estate fraud.  Below are a few of the types listed by FinCEN: 

1.  Misrepresentation – Making false statements and/or submitting false documents
2.  Misappropriation of Funds – Diverting funds to other projects for which the loan was not directed
3.  Bank Insider Collusion – Insiders approving loans and disbursement of funds for accomplices