The Federal Financial Institutions Examination Council (FFIEC) recently unveiled the fifth phase of updates to the FFIEC Bank Secrecy Act/Anti-Money Laundering (BSA/AML) Examination Manual (the Manual) on August 2, 2023. As outlined in a report by Perkins Coie, although the Manual is not explicitly intended as guidance for the banking industry, it offers critical insight into the operations of federal banking agencies and how they measure the effectiveness of a bank’s BSA/AML compliance program.
This launch comes as part of a series of ongoing updates which the FFIEC undertakes periodically in an attempt to keep the Manual current alongside changing regulations and evolving money laundering and financing risks. Not only are these updates essential for examiners in evaluating a banking institution’s BSA/AML compliance, but they also serve as a significant window for the banking sector to understand the regulatory expectations.
Regardless of the Manual’s non-binding nature, the updates are expected to steer banks towards adopting specific best practices in creating an effective BSA/AML compliance program. The contents of the Manual, therefore, can play a pivotal role in shaping a bank’s internal measures aimed at ensuring full compliance with relevant BSA/AML regulations.
Given the substantial implications for the banking sector, legal professionals working in financial institutions, and law firms, it is crucial to study the updated Manual in detail. The analysis should include understanding the new revisions, examining their impact, and exploring their potential effect on a financial institution’s BSA/AML program. For this, they should regularly monitor FFIEC’s and other regulatory updates concerning BSA/AML compliance.