Easier Anti-Money Laundering Compliance for Small US Banks Ahead

Bob Reynolds

26 June 2007

Smaller banks in the US will be able to adopt a new simpler approach to money laundering compliance from 2008. Banking and law enforcement authorities at the Financial Crimes Enforcement Network (FinCen) are developing new standards to administer the federal Bank Secrecy Act and anti-money laundering laws. They are adopting a risk-based approach to banks' compliance with money laundering regulations, a step giving some relief to small banks from huge compliance costs. US small community banks have complained for years that costly regulatory examinations should differ from those at big banks. Federal banking officials said the risk-based approach will begin with next year's bank examination cycle. However, they provided little detail on which bank activities might be relaxed or targeted in federal examinations. "We will be putting some meat on the bones over the next year," said John Reich, director of the Office of Thrift Supervision. Treasury secretary Henry Paulson called the changes "a common sense approach" to make law enforcement more efficient.