The Financial Crimes Enforcement Network’s anti-money laundering whistleblower program has had a quiet start.
The program became effective Jan. 1, 2021, following passage of the Anti-Money Laundering Act of 2020. The nascent program has yet to pay a significant award, and FinCEN, which oversees the program, has not yet proposed implementing regulations.
However, thanks to congressional action and FinCEN’s sustained focus on filed complaints, the program may now be ready to roar to life. Financial institutions and other covered entities should know how to evaluate the program’s potential impact following these congressional changes.
FinCEN’s AML program allows whistleblowers who report violations of the Bank Secrecy Act to receive up to 30% of any resulting monetary sanctions in excess of $1 million. The BSA requires financial institutions to maintain an effective anti-money laundering program and report different types of transactions, including those suspected of relating to criminal activity.
Penalties for BSA violations can be enormous, creating substantial incentives for whistleblowers to step forward.
For example, in March 2022 FinCEN fined USAA Federal Savings Bank $140 million for failing to timely review thousands of cases...
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