For decades, the current U.S. Anti-Money Laundering/Combating the Financing of Terrorism (AML/CFT) information sharing initiative has remained domestic-focused. On January 1, 2021, the Anti-Money Laundering Act of 2020 (AMLA) became law, which now shifts the focus toward an international, collaborative environment. This evolution emphasizes a global industry collaboration with the AMLA introducing several important changes.

For years, the Financial Crimes Enforcement Network (FinCEN) has emphasized the importance of collaboration within the financial industry to fight financial crime more effectively. The cultural shift in information sharing is now moving toward a global landscape. What has traditionally been a very siloed initiative in the U.S. is now shifting to a broader, global platform. This is uncharted territory for most financial institutions because it is viewed as unnatural, even controversial, to share information amongst other institutions. However, there has been value in coming together. The industry has yielded a greater effect on fighting financial crime by impacting more arrests and yielding greater asset recovery.

The current state of information sharing in the U.S. consists of two components: public/private or Section 314(a), and private/private or Section 314(b) under the USA Patriot Act. The 314(a) process allows law enforcement to seek information from U.S. financial institutions and is mandatory. Section 314(b) is voluntary and permits financial institutions to share information with one another to identify and report to the federal government activities that may involve money laundering or terrorist activity.

In contrast, the AMLA introduces several important changes to shift information sharing from solely domestic-based into a global landscape:

  • Expanding government subpoena power. The AMLA authorizes subpoenas to foreign banks that maintain correspondent accounts in the U.S.
  • Information sharing with foreign institutions. This may be like the current 314(b) process, making it easier for federal prosecutors to get information on investigations that include a foreign component.
  • The introduction of a pilot program allowing U.S. institutions to share Suspicious Activity Reports (SAR)-related information internationally. The pilot program would permit a financial institution with a SAR reporting obligation to share SARs with the institution’s foreign branches for the purpose of combating illicit financial risks.

Moving forward as a whole within the financial industry and breaking down the outdated silos is going to take considerable time and trust among financial institutions. As the changes enacted by the AMLA are implemented, and criminals evolve to evade detection, financial institutions should be compelled to participate in the future of information sharing. By collaborating with other intuitions, the industry will provide more value to law enforcement for what’s important: detecting and deterring money laundering and the financing of terror.

For additional information, check out the following resources.

Jennifer Broskie
BSA/AML Investigator

plus background image bottom right