Agencies Issue Rule Amending Definitions in Bank Secrecy Act

Two agencies (FinCEN and  FRB) issued a final rule largely adopting their 2012 proposal to amend the definitions of “funds transfer” and “transmittal of funds” under regulations implementing the Bank Secrecy Act. In light of the amendments to the Electronic Fund Transfer Act and its implementing regulation, Regulation E, FinCEN proposed to amend the definitions of “funds transfer” and “transmittal of funds.” Without such amendments, such transactions would no longer be subject to the Recordkeeping and Travel Rules’ requirements. The final rule responds to comments to: (1) clearly state that the amended rule does not change the current scope of the obligations of financial institutions under the Recordkeeping or Travel Rules, and (2) delay finalizing the amended rule until the CFPB’s remittance transfer rule was finalized and became effective. On January 3, 2014 the final rule becomes effective.

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