FinCEN postpones anti-money-laundering rule

Treasury’s Financial Crimes Enforcement Network (FinCEN) postponed the effective date of a rule bringing certain investment advisers within the standards of its anti-money-laundering and countering-the-financing-of-terrorism (AML/CFT) programs.

The effective date, previously Jan. 1, 2026, is now Jan. 1, 2028.

FinCEN said that no earlier than that date, it intends to propose a new effective date for the rule that established the Anti-Money Laundering/Countering the Financing of Terrorism Program and Suspicious Activity Report Filing Requirements for Registered Investment Advisers and Exempt Reporting Advisers (FINCEN-2024-0006 and RIN 1506-AB58).

An AICPA comment letter on the proposed rule in April 2024 expressed concern over the burden the requirements could impose on small registered investment advisers (RIAs). A firm with a staff smaller than 20 would have difficulty trying to “comfortably absorb” the requirements, the letter said. The letter also suggested that thresholds be based on average assets under management (AUM) per client.

The final rule did not consider staff size, but it did consider total AUM.

The rule, which FinCEN had estimated would affect 212 RIAs, was created to fight illicit finance risks, threats, and vulnerabilities posed by criminals and foreign adversaries that exploit the U.S. financial system and assets through investment advisers, FinCEN said in a news release.

But the rule should be tailored to fit differences among the investment adviser sector, FinCEN said. It added that extending the effective date may ease potential compliance costs for the industry and reduce regulatory uncertainty while FinCEN reviews the rule.

FinCEN also plans to work with the SEC to revisit the joint proposed rule establishing customer identification program rule requirements for investment advisers, Customer Identification Programs for Registered Investment Advisers and Exempt Reporting Advisers. The AICPA wrote a letter detailing specific concerns about that rule in July 2024.

— To comment on this article or to suggest an idea for another article, contact Martha Waggoner at Martha.Waggoner@aicpa-cima.com.

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