WASHINGTON—NAFCU shared the association's support of S. 2563, known as the ILLICIT CASH Act, in a letter to the Senate Banking Committee, while CUNA has sent a letter in support of the Financial Institution Customer Protection Act
"Credit unions support efforts to combat criminal activity in the financial system," wrote NAFCU Vice President of Legislative Affairs Brad Thaler. "Our members have a good working relationship with FinCEN, and they consistently inform us that the publication of periodic BSA/AML guidance is very helpful."
Thaler also urged the committee to schedule a markup in efforts to reform and improve BSA/AML requirements, highlighting that current requirements continue to be a burden to implement for credit unions.
In the letter, Thaler outlined specific provisions of the legislation that would help credit unions to effectively implement requirements, including:
- The establishment of AML programs and FinCEN as a financial institution liaison
- Improvements to AML/CFT (Counter Financing of Terrorism) oversight, communication, and processes
- Modernization of AML/CFT system
- Beneficial ownership disclosure requirements
Three Suggestions
Additionally, Thaler detailed three suggestions for how the bill could be improved: Enhance training for examiners on AML/CFT issues, index the thresholds for CTRs and suspicious activity reports for inflation, and create opportunities for technical grants or training to help "assist with the cost of software of technological capabilities."
"Small, community institutions stand to benefit the most from new technology in this area, as it would reduce the number of man-hours involved with BSA compliance," wrote Thaler. "Such a move would be in direct alignment with FinCEN's objectives, as training and technological subsidies would enable more credit unions to have robust BSA/AML procedures in-place, thereby furthering FinCEN's goals."
CUNA Support for FICPA
Separately, CUNA said a Senate bill, the Financial Institution Customer Protection Act (S. 3003), strikes the correct balance between combating fraud and maintaining financial institution integrity. The letter was sent to the bill’s sponsor, Sen. Ted Cruz (R-TX).
Joining Cruz as co-sponsors of the bill are Sens. Mike Crapo (R-ID), John Kennedy (R-LA), Thom Tillis (R-NC), Jim Inhofe (R-OK), Cindy Hyde-Smith (R-MS), John Cornyn (R-TX), Ben Sasse (R-NE) and Mike Braun (R-IN).
The bill would limit Federal banking regulators’ ability to discourage or restrict depository institutions from entering into or maintaining a financial services relationship with specific customers unless certain criteria are met.
‘Unnecessary Risks’
“While we strongly support the government’s role in ensuring the integrity of financial markets and eliminating fraud, the Operation Choke Point program’s broad enforcement tactics may have created unnecessary risks to consumers and to the economy,” the letter reads. “Credit unions are committed to maintaining the ability to serve their members while strictly following all laws and governing regulations. S. 3003 is a reasonable approach to preventing fraud and maintaining financial integrity without overreaching.”
Operation Choke Point restricted depository institutions from entering into or maintaining a financial services relationship with specific customers by insisting certain criteria are first met. The Department of Justice under President Donald Trump announced early in his administration it would end the program.