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BSA/AML Hot topics: FINCEN issues first pandemic-focused advisory

By Naomi Glass, AVP, BSA/AML Compliance Officer

2020 BSA/AML/OFAC on-demand compliance webinar

Available for on-demand viewing now through December 31
Length: 3 hours

As the country begins its next phase of opening up the economy, there continues to be a flurry of regulatory guidance originating from the Financial Crimes Enforcement Network (FinCEN) regarding BSA requirements and how those relate to the coronavirus pandemic. It is our goal at Corporate One to keep you in the loop as new guidance comes out.

To recap, my March and April articles discussed two prior FinCEN notices. The first notice released on March 16 advised financial institutions to remain vigilant about malicious or fraudulent transactions similar to those that occur in the wake of natural disasters, such as imposter scams, investment scams, product scams, and insider trading. The second notice released on April 3, along with a subsequent FAQ on April 13, provided guidance on how financial institutions can meet BSA-related requirements with respect to beneficial ownership when issuing Paycheck Protection Program (PPP) loans.

Most recently, on May 18, FinCEN issued its first advisory (FIN-2020-A0002) related to the pandemic. This advisory focuses on medical scams. Topics in this latest advisory include the following:

  • Medical-related frauds, including fraudulent cures, tests, vaccines, and services
  • Scams involving the non-delivery of medical-related goods
  • Price gouging and hoarding of medical-related items

The advisory also includes case studies, red flags, and information on reporting suspicious activity.

In addition to this advisory, on May 18, FinCEN published a companion notice that contains pertinent information regarding reporting COVID-19-related crime through the filing of suspicious activity reports (SARs) and reminds financial institutions of certain BSA obligations.

These documents contain an abundance of useful information, and I would strongly encourage your BSA staff to review this newest advisory and all other regulatory guidance provided by FinCEN in response to the pandemic. FinCEN intends to issue multiple COVID-19 related advisories going forward, and Corporate One is committed to keeping your credit unions “in the know.” Stay tuned.