Treasury wants to ease SAR, CTR burden

WASHINGTON (6/25/07)--Treasury Secretary Henry Paulson said Friday the agency which gleans information from Suspicious Activity Reports (SARs) and Currency Transaction Reports (CTRs) would ensure Bank Secrecy Act (BSA) provisions are administered in a more "efficient and effective manner."

Paulson met with representatives of the financial services industry—including the Credit Union National Association (CUNA)--to discuss Financial Crimes Enforcement Network's (FinCEN) continued efforts to "protect the financial system from abuse by money launderers, terrorists, and other criminals."

FinCEN indicated both SARs and CTRs are necessary to adequately address financial crimes--including terrorist financing, money laundering—-but would look for ways to streamline the process, according to CUNA Deputy General Counsel and Regulatory Affairs Senior Vice President Mary Dunn, who attended the meeting.

During the meeting, Paulson unveiled four areas on which FinCEN could make BSA more efficient and effective:

• Match risk-based examination to risk-based obligations;
• Clarify the definition of a money services business;
• Aggregate all FinCEN regulations into one central location; and
• Provide more feedback to financial institutions about specific enforcement actions as a result of SAR and CTR filings.

During the meeting, FinCEN said the regulatory community recognizes that not all financial institutions are subject to the same risk--"an institution with minimal to no international business that serves only a handful of communities does not share the same risk profile as a bank that does business around the world in many currencies."

According to the BSA Fact Sheet on Efficiency released Friday, FinCEN will initiate a joint effort with the federal banking regulators to "ensure that financial institutions and regulators treat compliance obligations in a manner that helps to avoid expenditures that are not commensurate with actual risk."

While no timetable was given, Dunn said FinCEN soon would provide a formal comment process to gather input on easing the SAR and CTR compliance process for financial institutions.

Dunn added CUNA's new BSA Task Force is gathering information about the process and formulate proposals on how to improve it. She said the Treasury Department indicated a willingness to meet with the group.

Resource Links

CUNA’s BSA Task Force

BSA Fact Sheet on Efficiency

CUNA BSA Resource

Financial Crimes Enforcement Network