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BSA/AML Hot topics: FinCEN releases new COVID-19 update

Naomi Glass, AVP, BSA/AML Compliance Officer

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On October 13, FinCEN released its fourth advisory (FIN-2020-A007) related to COVID-19. This advisory focuses on unemployment insurance (UI) fraud during the pandemic. According to the U.S. Department of Labor, the total number of people claiming benefits in all UI programs for the week ending September 26 was a staggering 25,290,325. Fraud has become a rampant problem due to the sheer volume of UI claims. Fortunately, FinCEN’s latest advisory provides descriptions of five UI fraud schemes that financial institutions should be aware of. It also provides red-flag indicators that financial institutions should take note of from a transactional standpoint.

I would encourage your BSA staff to review this advisory along with all others issued by FinCEN in response to the pandemic. They provide useful guidance to assist financial institutions in detecting, preventing, and reporting suspicious activity during this unprecedented time.