FinCEN CIP for Exempt Bank Entities


On Sep. 14, FinCEN issued rule on CIP programs for exempt banks.


  • FinCEN issued final rule to require customer identification program, AML program, and beneficial ownership requirements, for banks lacking a federal functional regulator.
  • Final rule aims to ensure consistency of BSA and AML coverage across banking sector.
  • Implemented 31 CFR 1010, 1020, sections 352, 326 and 312 of the USA PATRIOT Act.
  • Background
  • Follows Aug. 25, 2016 FinCEN NPRM for banks without federal regulator, see #28805.
  • Also follows FinCEN May 2016 CDD rule, applicable to regulated banks, see #28425.
  • Follows 2016 FATF US mutual evaluation to include non-federally chartered bank type.
  • Follows Oct. 2001 BSA, USA PATRIOT Act requirement for AML compliance programs.
  • Summary
  • Incrementally eliminate interim final rule's temporary exemption, require applicability.
  • Extended customer identification program CIP, beneficial ownership requirement (BO).
  • Banks with no federal functional regulator are currently required to comply with certain BSA obligations, including filing suspicious activity and currency transaction reports.
  • Such banks should leverage existing policies, procedures, internal controls required by other statutory, regulatory requirements to fulfill obligations set out in the final rule.
  • Effectiveness
  • Rule will be effective 60 days after publication date in federal register; banks without federal regulators must comply 180 days from final rule publication in federal register.
  • FinCEN anticipates that banks lacking a federal functional regulator will be able to leverage existing policies, procedures and internal control to meet the new obligations.

Regulators FinCEN
Entity Types B/D; Bank; CU; HF; Ins; Inv Co; Thrift
Reference 4810-02, 2020-20325, RIN 1506-AB28, PR 9/14/2020, BSA, USA PATRIOT Act, S 352, 326, 312; Citation: *31 CFR* Parts 1010, 1020;
Functions AML; Anti-Bribery; Compliance; Financial; Legal; Operations
Countries United States of America
Products Banking; Hedge Funds; Insurance; Loan; Securities
Regions Am
Rule Type Final
Rule Date 9/14/2020
Effective Date 11/16/2020
Rule Id 86073
Linked to Rule :28805
Reg. Last Update 9/14/2020
Report Section US Banking

Last substantive update on 09/15/2020