FinCEN Seeks (Again) to Impose Anti-Money Laundering Compliance Obligations on Investment Advisers: Client Alert Digest

Summary

This client alert digest discusses the Financial Crimes Enforcement Network's (FinCEN) recent proposal to impose certain anti-money laundering (AML) compliance and reporting obligations on registered investment advisers and exempt reporting advisers (Investment Advisers). On February 15, 2024, FinCEN published a notice of proposed rulemaking in the Federal Register (89 Fed. Reg. 12108) soliciting comments on a set of proposed regulations that would expand the definition of ''financial institution'' under the Bank Secrecy Act (BSA) to include Investment Advisers, require Investment Advisers to maintain AML programs, and require Investment Advisers to report suspicious financial activity to FinCEN pursuant to the BSA. Notably, FinCEN has attempted to expand the compliance requirements of the BSA to Investment Advisers multiple times in the past, without ever finalizing previously proposed regulations.