Yesterday, the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (“FinCEN”) published responses to three frequently asked questions (“FAQs”) regarding customer due diligence requirements for “covered financial institutions” (i.e., U.S. banks and savings associations, U.S. branches and agencies of foreign banks, mutual funds, brokers or dealers in securities, futures commission merchants and introducing brokers in commodities). The FAQs clarify regulatory requirements for collecting customer information, establishing customer risk profiles and performing ongoing monitoring of customer relationships. In all three cases, FinCEN emphasizes its expectation for risk-based procedures, in lieu of a categorical, one-size-fits-all approach. These FAQs expand on guidance published by FinCEN on July 19, 2016 and April 3, 2018.
FinCEN Issues FAQs Regarding Customer Due Diligence Requirements
