FFIEC Issues Revised BSA/AML Exam ManualFirst Update Since 2007; Compliance Program Structures Re-Worked
The revised manual reflects federal and state banking agencies commitment to provide current and consistent guidance on risk-based policies, procedures and processes for banking organizations to comply with the Bank Secrecy Act and safeguard operations from money laundering and terrorist financing.
Regulators say the manual was updated to further clarify supervisory expectations and incorporates regulatory changes since it was released in 2007. The revisions reflect feedback from the banking industry and examination staff.
The manual has new and revised sections that are identified in the table of contents by a 2010 revision date. Some of the significant updates include:
Bulk Currency Shipments - Added one new section, on bulk currency shipments.
BSA/AML Compliance Program Structures - The section on Enterprise-Wide Compliance programs was substantially reworked to discuss the variety of programs that exist, reflect current supervisory expectations, and enhance the specific discussion of consolidated compliance programs.
Core Examination Procedures - Streamlined and reorganized the core examination procedures for assessing the BSA/AML compliance program to make them more logical.
Developing Conclusions and Finalizing the Examination - Revised the section to include guidance to examiners on how to determine whether a violation is systemic or recurring, as opposed to a technical or isolated violation.
Currency Transaction Reporting Exemptions - The section was updated to reflect the changes in the regulation and FinCEN guidance in this area.
Funds Transfers - This section was updated to reflect introduction of the SWIFT MT 202 COV message format.
Suspicious Activity Reporting - The discussion of methods to identify, research, and report suspicious activity was improved. The section was reorganized to reflect current supervisory expectations and made the discussion easier to follow and more user-friendly. A new Appendix S was added to illustrate the interaction between the different components of a suspicious activity monitoring program.
Automated Clearing House Transactions - Updated the section to reflect the recent changes to international Automated Clearing House (IAT) transactions and corresponding changes were made to the OFAC section.
Electronic Cash - This section was updated to include a more in-depth discussion of Prepaid Cards.
Trade Finance Activities - Updated the definitions in the section to more closely reflect actual usage in the industry and added a reference to recent Wolfsberg Group guidance.
Electronic Banking - Updated the section (specifically, the Remote Deposit Capture discussion) to reflect the FFIEC guidance, Risk Management of Remote Deposit Capture.
Third-Party Payment Processors - The revisions to this section reflect recent agency guidance on payment processor relationships and risk management.