On February 13, 2024, FinCEN issued a proposed rule to keep criminals and foreign adversaries from exploiting the U.S. financial system and assets through investment advisers. The proposed rule aims to include certain investment advisers in the definition of “financial institution” under the BSA, prescribe minimum standards for anti-money laundering/countering the financing of terrorism (AML/CFT) programs to be established by covered investment advisers, require covered investment advisers to report suspicious activity to FinCEN pursuant to the BSA, and make several other related changes to FinCEN regulations.
According to FinCEN, the proposed rule would address gaps in the existing AML/CFT regulatory framework in the investment adviser sector. The proposed regulations will apply to investment advisers that may be at risk for misuse by money launderers, terrorist financers, or other actors who seek access to the U.S. financial system for illicit purposes via investment advisers and threaten U.S. national security.
Read FinCEN’s press release here.
The proposed rule can be found here.