Bank Secrecy Act Reform

• Reforming the BSA Program Rules. True risk-based BSA program rule reform would explicitly allow banks to reallocate compliance resources away from low-risk areas and direct them to high-risk areas to focus on real threats, while eliminating unnecessary paperwork and box-checking.
• Completing reforms to the Customer Due Diligence (CDD) Rule. FinCEN’s February 2026 exceptive relief order allowing banks to collect beneficial ownership information on their legal entity customers on a “per customer basis” was an important win for America’s banks.  With your help, ABA was able to inform FinCEN that bank customers open 140-160 million new accounts each year, rather than one account per company. FinCEN can finish the job by amending the CDD rule. 
• Modernizing BSA reporting rules. FinCEN must prioritize reforms to modernize and streamline Currency Transaction Reporting (CTR) rules and form. Banks file 20 million Currency Transaction Reports (CTRs) —1 for every 16 Americans— every year, diverting banks’ BSA compliance resources away from investigating real threats. Limit CTR reporting to the information essential to law enforcement, reform complex aggregation requirements, and raise the CTR threshold to at least $30,000. FinCEN must fix the reporting forms as well. The SAR and CTR forms are full of boxes, unread by law enforcement —but that pose compliance traps for banks. Eliminate these boxes, reduce CTR burden, and focus on suspicious activity.
• Exempting banks from the requirement to report on state-licensed cannabis businesses. 
• Increasing feedback to banks. ABA is working with IRS-CI on their pilot project to increase SAR and CTR reporting feedback to banks, but more feedback helps banks detect more suspicious activity. Typically, when a bank submits a SAR to FinCEN, the bank hears nothing more. Banks should receive updated information on evolving law enforcement priorities in order to tune their programs and not be asked to screen for outdated advisories. Allow banks to flag their highest priority SARs for law enforcement to determine if they have identified real threats.
• Completing beneficial ownership reporting rule reform. FinCEN exempted 33 million U.S. small businesses from beneficial ownership reporting requirements, limiting it to 12,000 foreign businesses. FinCEN should finish the job by completing reforms to eliminate unnecessary burden to banks.

ABA will continue partnering with law-makers, federal banking regulators, law enforcement groups, and bankers to find common sense improvements to the current framework that will support law enforcement while minimizing unnecessary regulatory burdens.

ABA also actively supports regulatory initiatives designed to improve the BSA/AML system:

• Interagency cooperation among the prudential regulators to identify steps that can streamline the process and eliminate inefficiencies, particularly steps to promote innovation.
• FinCEN efforts to identify metrics that can quantify and measure success to ensure that resources are used wisely.
• FinCEN efforts to evaluate the effectiveness of the BSA compliance regime to identify steps that can eliminate unnecessary reporting, facilitate information sharing between financial institutions and to-and-from law enforcement.
• Efforts to identify and share law enforcement priorities with the financial sector to let banks make the most efficient and effective use of limited resources.
• Ensuring that the risk-based approach to BSA compliance is reflected in the examination process, keeping the FFIEC BSA/AML examination manual updated, and providing interagency and regular training for BSA examiners.