Agencies Issue a Joint Statement on Innovative Industry Approaches

WASHINGTON — The Office of the Comptroller of the Currency (OCC), the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, the Financial Crimes Enforcement Network (FinCEN), and the National Credit Union Administration today issued a statement encouraging banks to take innovative approaches to meet their Bank Secrecy Act/anti-money laundering (BSA/AML) compliance obligations and further strengthen the financial system against illicit financial activity.

The statement recognizes that private sector innovation, including new ways of using existing tools and adopting new technologies, can help identify suspicious activity and combat money laundering and terrorist financing. Banks are encouraged to consider, evaluate, and where appropriate, responsibly implement innovative approaches in this area. The agencies, however, will not penalize banks that maintain effective anti-money laundering programs but choose not to pursue innovative approaches. The statement makes clear the agencies are committed to continued engagement with the private sector to modernize and innovate in their BSA/AML compliance programs.

“Banks and regulators take their responsibility to enforce BSA/AML compliance seriously,” said Comptroller of the Currency Joseph Otting. “Significant resources and efforts have been made to improve the infrastructure and process around compliance and to enhance the industry’s ability to identify illicit finance threats and report them to law enforcement. The OCC is committed to encouraging innovation through our supervisory approach and engagement with banks and thrifts, fintech companies, and others interested in innovation to ensure the safe, sound, and fair operation of the federal banking system.”

The OCC established an office of innovation that supports the implementation of responsible innovation and new technology in the financial system. While management of institutions regulated by the OCC should continue to follow existing protocols for communication with their supervisory offices, the OCC Office of Innovation serves as an additional resource and central point of contact to facilitate communication related to innovation and new technology within the federal banking system. Other agencies also have, or will, establish similar projects or offices.

The agencies welcome industry’s feedback on how best to support innovative efforts through supervisory processes, regulations, and guidance. Those wishing to share such feedback in writing with the agencies may do so by sending their submission electronically to FRC@fincen.gov. Feedback may also be provided to the OCC at innovation @occ.treas.gov.

Today’s joint statement is the second statement resulting from a working group formed by these agencies and Treasury’s Office of Terrorism and Financial Intelligence aimed at improving the effectiveness and efficiency of the BSA/AML regime. On October 3, 2018, the agencies issued a joint Interagency Statement on Sharing Bank Secrecy Act Resources.

Related Link

• Joint Interagency Statement on Innovation (PDF)