FinCEN's No-Action Letter Plan May Have Limited Impact

Marc-Alain Galeazzi and Malka Levitin authored an article for Law360 discussing the U.S. Department of the Treasury's Financial Crimes Enforcement Network (FinCEN) publishing an advance notice of proposed rulemaking to solicit comments on the implementation of a no-action letter process related to anti-money laundering compliance.

"A no-action letter process could be a valuable tool for financial institutions that are, or may be, subject to FinCEN's jurisdiction," the authors wrote. "Well-established financial institutions, along with fintech companies and startups, may leverage the process to obtain clarity and comfort with their compliance with BSA requirements and regulatory expectations. This, in turn, should encourage innovation in the industry."

They continued: "If implemented, however, this process would likely invite numerous no-action letter requests. FinCEN will need sufficient staff with the relevant expertise to effectively respond to these letters, and may need to hire additional personnel. Moreover, FinCEN may take a conservative approach in issuing responses, and err on the side of increased regulation."

Read the full article.