Banking regulators, including the Treasury’s Financial Crimes Enforcement Network, will give financial institutions, including credit unions, the freedom to test innovative anti-money laundering/Bank Secrecy Act programs without the fear of being penalized, the agencies said today.
“Pilot programs undertaken by banks, in conjunction with existing BSA/AML processes, are an important means of testing and validating the effectiveness of innovative approaches,” the agencies said, in a joint announcement. “While the agencies may provide feedback, pilot programs in and of themselves should not subject banks to supervisory criticism even if the pilot programs ultimately prove unsuccessful.”
In a separate statement, the National Credit Union Administration said, the agreement among regulators “establishes no new supervisory expectations related to the use of innovative strategies or technology like those discussed in the joint-agency statement and a credit union’s participation in such innovations related to BSA/AML compliance will not affect the agency’s assessment.”
Members of Congress have said they are concerned that the federal BSA/AML statutes are out of date.
The agencies said they recognize that the private sector is developing new technologies to help financial institutions identify and report suspicious activity.
Institutions are becoming more sophisticated in their approaches to identifying suspicious activities. Some institutions, the agencies said, are experimenting with artificial intelligence and digital identity technology to enhance their programs.
“The agencies welcome these types of innovative approaches to further efforts to protect the financial system against illicit financial activity,” the statement said.