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Congressmen Gonzalez and Royce Kickstart Bipartisan Effort to Crack Down on Money Laundering and Terrorism Financing

November 14, 2017

WASHINGTON – On Monday, Congressmen Vicente Gonzalez (TX-15) and Ed Royce (CA-39) introduced the bipartisan Anti-Money Laundering and Counter-Terrorism Financing Modernization Act or the AML and CTF Modernization Act to strengthen the United States Anti-Money Laundering (AML) and Counter-Terrorism Financing (CTF) system.

The bill would expand the ability of financial institutions to share suspicious activity reports within their organization to improve enterprise-wide risk management, and would require the Department of the Treasury to improve qualitative feedback for financial institutions and Federal financial regulators on their AML/CTF efforts.

"Money laundering poses a serious threat to the legitimacy and stability of our local, national, and international financial institutions," Congressman Gonzalez said. "The Anti-Money Laundering and Counter Terrorism Financing Modernization Act establishes a protocol that allows banks to share targeted information without liability; requires regulators to produce rulings that will advance financial institutions' ability to abide by Anti-Money Laundering and Counter-Terrorism Financing regimes; and will require the U.S. Department of the Treasury to share helpful Anti-Money Laundering and Counter-Terrorism Financing intelligence that would empower our financial institutions to fight against money launderers. Enacting this important legislation will bolster the transparency and efficiency of our financial system while enhancing our ability to prevent money laundering schemes in a timely manner."

Lastly, the legislation would improve the U.S. Department of the Treasury's Financial Crimes Enforcement Network's (FinCEN) administrative rulings process and require the Department to explore the potential for artificial intelligence, machine learning, and other technologies to help detect and prevent money laundering and terrorist financing.

"Financial criminals and terrorists have evolved in the decades since our anti-money laundering regime was built but our regulatory structure hasn't kept pace," Congressman Royce said. "By some estimates, nearly 70 percent of spending on AML compliance is focused on inputs over outcomes. This does little to thwart criminal syndicates, rogue nations, and terrorist networks but it strips away resources that could be better spent on new technologies and other innovations to support our national security. The AML and CTF Modernization Act will refocus our regime on quality over quantity and the use of new tools to assist law enforcement."

Issues:Economy