The transfer of billions of dollars in deposits out of large banks to smaller competitors is likely to increase the compliance work and woes of credit unions and community banks. Fueled by dissatisfaction with since-abandoned plans by financial institutions to charge for debit card use, and by the popularity of a consumer activist initiative loosely associated with political protests, hundreds of thousands of customers have closed their accounts with big banks and moved their money to smaller institutions since September. The move has the potential to strain anti-money laundering (AML) compliance departments at small banks and credit unions, according to...
Once confined to large banks, the practice of forming teams to review suspicious activity reports ahead of regulatory filing deadlines is increasingly being adopted by midsize financial institutions, say compliance professionals.
The push by community banks and other financial institutions to generate fee income with new products is causing some institutions to run afoul of their examiners, according to federal banking regulators.
Finding themselves locked out of some large U.S. banks because of compliance concerns, third-party payment processors are increasingly turning to small- and mid-sized institutions for financial services, say consultants.
Foreign government officials with U.S. accounts are increasingly banking at smaller financial institutions that are vulnerable to financial abuse because of scant compliance resources, say analysts.
Efforts by the U.S. Treasury Department to get small banks to file their Bank Secrecy Act documents electronically are likely to face stiff resistance despite law enforcement complaints, say consultants.
Henry Paulson, at a meeting scheduled for Friday at the Financial Crimes Enforcement Networks headquarters, will disclose plans to improve risk-based exam procedures for institutions, people familiar with the matter said.
Financial institutions with limited resources often dont seek exemptions for filing currency transaction reports because they are unable or unwilling to handle the required additional due diligence and regulatory scrutiny.
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