News
Plans for More State Oversight of MSBs Likely to Face Funding Hurdles
By Colby Adams
printA U.S. Treasury Department budget proposal to shift Bank Secrecy Act oversight duties from the IRS to state examiners could run into funding troubles from state agencies, say officials. Under the plan, the department's Financial Crimes Enforcement Network (FinCEN) would partially offset millions of dollars in planned fiscal year 2012 budget cuts by withholding $5.9 million in annual reimbursements to the IRS for anti-money laundering (AML) examinations of money services businesses (MSBs). FinCEN would instead use $2.5 million "to better carry out its responsibilities to coordinate among all financial supervisory agencies exercising delegated examination authority, as well as state supervisory...
TO READ THE FULL STORY
Subscribe
Learn More
Related News
San Francisco-based AirBnB isn't exactly what springs to mind when thinking of money services businesses, but the 6-year-old company deemed itself just that last year by registering with the U.S. Treasury Department.
Thousands of small money services businesses have lost some federal anti-money laundering oversight and guidance due to budget cuts involving two U.S. Treasury agencies, according to current and former government officials.
A soon-to-be introduced House bill could allow state financial examiners to better share the results of their money services businesses examinations with counterparts throughout the country.
Hundreds of money services businesses and other small financial institutions will miss the U.S. Treasury Department's June 30 deadline to file all of their anti-money laundering reports electronically, say sources.
A consumer protection rule requiring money services businesses to disclose the fees their clients must pay has prompted dozens of banks of all sizes to consider dropping their personal remittance services.
When training agents working through money services businesses, compliance officials should take a creative, multimedia approach, said Anthony Rodriguez, global compliance officer at the Los Angeles-based Associated Foreign Exchange, Inc (AFEX).
The White House proposed Monday trimming the U.S. Treasury Department's budget by three percent for the coming fiscal year, including a seven percent drop in funding for the country's financial intelligence unit.
Bank Secrecy Act compliance officers should proactively shield themselves from both budget cuts and potential retaliation for disclosing regulatory violations, according to a former OCC attorney.
As many federal agencies have watched their budgets and staffs shrink or remain static in recent years, the U.S. Treasury Department office charged with researching economic sanctions has seen something rare: growth.
Possible budget cuts for the U.S. financial intelligence unit are spurring concerns that the bureau may curtail its funding of the Internal Revenue Service's anti-money laundering examinations, say current and former federal officials.
Planned budget cuts that would limit cooperation between regional investigators and the U.S. Treasury Department's financial intelligence unit would be nixed under the latest congressional appropriations bill.
A proposed funding cut that would restrict some governmental access to a U.S. Bank Secrecy Act database could also make it harder for state examiners to vet banks and money services businesses, say critics of the plan.
The U.S. Treasury Department's budget would see a four percent increase over last year's funding under a White House proposal scheduled to take effect in October.
The U.S. Treasury Department's Financial Crimes Enforcement Network would see its budget rise by nine percent for fiscal year 2011 under a Senate proposal released Tuesday.
Budgetary constraints and understaffing are hampering U.S. Treasury Department plans to update technology used by its financial intelligence unit to gather and store data, U.S. lawmakers said Wednesday.
Contending with a lengthy recession, some U.S. banks have fallen behind on their core anti-money laundering compliance duties, including risk ranking customers and reporting suspicious activity, say federal officials.
Job cuts among the anti-money laundering staff of small to mid-sized financial institutions are prompting regulatory examiners to lower bank compliance ratings, federal regulators said at a conference Tuesday.
Now that the confetti has settled and the kazoos have been packed away for next year's parties, anti-money laundering compliance officers consider what lies ahead in 2008.