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AML Costs of SEC Crowdfunding Proposal Likely to Exceed $100,000 Per Business
By Brian Monroe
printInternet portals that facilitate crowd-sourced fundraising will need to spend tens of thousands of dollars to comply with anti-money laundering rules proposed by the U.S. regulator of broker-dealers, say industry consultants. On Wednesday, the U.S. Securities and Exchange Commission (SEC) proposed regulations that would define crowdfunding businesses as "brokers" under the Securities Exchange Act of 1934. The rules, which stem from the Jumpstart Our Business Startups Act, effectively bring the Internet portals under Bank Secrecy Act rules. If finalized, the proposed rules would require the businesses to draft anti-money laundering (AML) policies, maintain a customer identification program (CIP) internally or...
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