ICBA: AML/CFT modernization should not expand reg burden

ICBA told the federal banking agencies that their proposals to update anti-money-laundering and countering-the-financing-of-terrorism programs would create additional burdens on banks without any demonstrable benefit to combatting money laundering or terror financing.

Details: In a comment letter, ICBA said the proposals would likely:

  • Impede banks’ efforts of achieving an effective, risk-based, and reasonably designed AML/CFT program.

  • Increase regulatory burden and compliance spending by hindering risk-related resource allocation.

  • Increase occurrences of subjective exams due to the lack of guidance.

  • Invalidate the competency, training, and expertise of Bank Secrecy Act officers who happen to have other positions in a bank.

  • Keep in place the practice of robotic and mechanical compliance.

More: ICBA added that banks would face increased enforcement risk that result from technical errors if the rule were adopted.

Background: The proposed rules would require AML/CFT programs with certain minimum components to incorporate government-wide AML/CFT priorities.