On 12/18/2020, the Financial Crimes Enforcement Network (FinCEN) requested comments on a new proposed requirements for certain transactions involving convertible virtual currency (CVC) or digital assets with legal tender status. Under the proposal, banks and money services businesses (MSBs) would be required to submit reports, keep records, and verify the identity of customers in relation to transactions above certain thresholds involving CVC/LTDA wallets not hosted by a financial institution (also known as “unhosted wallets”) or CVC/LTDA wallets hosted by a financial institution in certain jurisdictions identified by FinCEN.

On 12/17/2020, the OCC issued a proposal to modify the requirements to file suspicious activity reports (SARs) for OCC regulated institutions (national banks and federal savings associations). According to the OCC’s release, the proposed rule would allow the OCC to issue exemptions from SAR reporting requirements. The proposed rule would make it possible for the OCC to grant relief to national banks or federal savings associations that develop innovative solutions intended to meet Bank Secrecy Act requirements more efficiently and effectively.

It should be noted, however, that OCC regulated banks that are also subject to FinCEN’s SAR regulations, would need to gain an exemption from both the OCC and FinCEN in order to be exempt from SAR reporting requirements.

On 12/17/20020, the Federal Trade Commission (FTC) announced the first law enforcement crackdown on deceptive claims in the growing market for cannabidiol (CBD) products. The FTC is taking action against six sellers of CBD-containing products for allegedly making a wide range of scientifically unsupported claims about their ability to treat serious health conditions, including cancer, heart disease, hypertension, Alzheimer’s disease, and others. The FTC is requiring each of the companies, and individuals behind them, to stop making such unsupported health claims immediately, and several will pay monetary judgments to the agency. The orders settling the FTC’s complaints also bar the respondents from similar deceptive advertising in the future, and require that they have scientific evidence to support any health claims they make for CBD and other products.

On 12/10/2020, the Financial Crimes Enforcement Network (FinCEN) announced that Director Ken Blanco had provided guidance regarding 314(a) sharing. This guidance was provided through a speech presented by Director Blanco, a release by FinCEN and an updated Fact Sheet. In their release, FinCEN explains that they are providing three main clarifications as a result of industry feedback.

On 11/30/2020, the FDIC - along with the OCC, Federal Reserve, and CFPB - announced that they will be holding an Ask the Regulators webinar for their supervised institutions. This webinar event will be on the use of artificial intelligence (AI), including machine learning (ML), and will be held on Wednesday, December 16, 2020 at 1:00 PM EST. Participants must preregister for the event.

On 11/19/2020, the Financial Crimes Enforcement Network (FinCEN), in coordination with the Federal Banking Agencies, issued a joint fact sheet for banks to better understand how to apply a risk-based approach to charities and other non-profit organizations, often referred to as NPOs. In their release, the CFPB explains that the joint fact sheet highlights the importance of ensuring that legitimate charities have access to financial services and can transmit funds through legitimate and transparent channels, especially during the current COVID-19 pandemic. The joint fact sheet also reminds banks to apply a risk-based approach to customer due diligence (CDD) requirements when developing the risk profiles of charities and other non-profit customers.

On 11/6/2020, the Financial Crimes Enforcement Network (FinCEN) issued an advisory on the Financial Action Task Force (FATF)-identified jurisdictions with anti-money laundering, combating the financing of terrorism, and the proliferation deficiencies. In short, FATF recently (10/23/2020) updated its list of jurisdictions with strategic deficiencies in their regimes to counter money laundering, terrorist financing, and proliferation financing. These changes may affect US financial institutions’ obligations and risk-based approaches with respect to relevant jurisdictions. FinCEN requests that financial institutions filing a SAR for related activity reference their advisory in SAR field 2 (Filing Instruction Note to FinCEN) and the narrative by including the key term “October 2020 FATF FIN-2020-A009.”

On 11/4/2020, FinCEN Director Kenneth Blanco issued a renewal of a Geographic Targeting Order that requires title insurance companies to collect and report information about the persons involved in certain residential real estate transactions. This order covers certain transactions in which residential real property is purchased by a legal entity in the amount of $300,000 or more without the use of a loan in certain metropolitan areas. In conjunction with the geographic targeting orders, FinCEn has also released a set of FAQs to help clarify the requirements.