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FinCEN issues new fact sheet on information sharing
The Financial Crimes Enforcement Network (FinCEN) last week issued a new fact sheet on section 314(b) of the USA PATRIOT Act to enhance utility of the program and make clarifications on information sharing between financial institutions. The fact sheet replaces an existing fact sheet that was previously issued in 2016.
The fact sheet suggests that financial institutions may share information regarding fraud where appropriate and remain complaint under FinCEN’s current regulations only in situations where a financial institution suspects money laundering or terrorist activity, and is sharing the information for an appropriate purpose under section 314(b).
In addition, the fact sheet provides that financial institutions may share information under the program in situations where they do not have specific information that the activity directly relates to proceeds of a specified unlawful activity and that a financial institution does not need to have made a conclusive determination that the activity is suspicious in order to qualify for the safe harbor.
Although this is not explicit in FinCEN’s regulations, the fact sheet provides additional guidance on how and when financial institutions like credit unions can voluntarily share information about fraud with other financial institutions. Read the full fact sheet here.
NAFCU has advocated for the expansion of the information sharing mechanism in section 314(b) to include instances of fraud, as they could be part of a larger money laundering scheme and may assist in mitigating losses.
In 2019, FinCEN requested comment on its 314(b) information sharing program. NAFCU offered recommendations to enhance the program and make it easier for financial institutions to differentiate individuals when law enforcement flag potential threats. The association remains in close contact with FinCEN to provide credit union insights on topics like the information sharing initiative, Bank Secrecy Act/anti-money laundering reform, and other related issues.