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The U.S. financial intelligence unit is preparing to roll out multiple proposed rulemakings over the next several months as it moves to implement the most time-sensitive provisions of a comprehensive anti-money laundering reform package.

The Treasury Department’s Financial Crimes Enforcement Network published a preliminary notice on April 5 seeking input on the best ways to securely and effectively develop and maintain a database of U.S. corporate owners as mandated by the National Defense Authorization Act, or NDAA, at the turn of the year.

FinCEN will publish an interim rule after reviewing and analyzing feedback from financial institutions and other interested parties through May 5, and, after collecting another round of feedback, plans to issue a final version of the measure by Jan. 1, said Barry Emmert, the bureau’s director of regulatory policy.

The bureau will then develop protocols to ensure safe storage and protection of beneficial ownership information, and provide law enforcement and financial institutions access to the data for investigative and compliance purposes, respectively, Emmert told attendees of the ACAMS AML and Financial Crime Conference on Tuesday.

“The second big priority … is to continue to strengthen our ranks, filling our vacancies, training our people, improving our technology,” Emmert said. “The final priority … is the importance to finalize our ongoing rulemaking. You have seen and will continue to see a lot of rulemaking coming out of FinCEN in the coming months.”

Federal lawmakers tasked the bureau with building and administering the centralized registry of beneficial owners by enacting the NDAA over the veto of former President Donald Trump.

In a preliminary request on April 9, President Joe Biden asked lawmakers to appropriate an additional $64 million to FinCEN over the last financial year’s enacted budget to cover the bureau’s development and construction of the database.

Rep. Maxine Waters (D-CA), chair of the House Financial Services Committee, responded Monday by proposing a larger budget increase of $74 million, adding that she would support the nearly $100 million in additional funding that FinCEN initially estimated it would need to implement the AML provisions of the NDAA.

The legislation requires the bureau to take several actions and pursue several initiatives in the coming months and years, including a program through which U.S. banks may share data on suspicious activity with their overseas subsidiaries, branches and affiliates, as well as an interagency review of the Bank Secrecy Act’s effectiveness.

FinCEN must complete both tasks by Jan. 1.

The NDAA separately gives the bureau six months to consult with federal, state and local law enforcement agencies, federal banking agencies and financial institutions, and issue and update every four years thereafter a list of illicit finance priorities against which banks will be expected to calibrate their BSA programs.

“We anticipate issuing the AML/CFT [combating the financing of terrorism] priorities at some point in the summer … Congress has put some very aggressive timelines on us for that,” Emmert said. “I don’t think there’ll be any surprises as these priorities are going to be consistent with Treasury’s “National Illicit Finance Strategy” as required by Congress.”

The 56-page document, which the Treasury Department published in February 2020, lists cyber-enabled fraud; criminal use of shell companies, attorneys, accountants and cryptocurrencies; and trafficking of individuals, drugs or technologies used to develop weapons of mass destruction as the primary drivers of illicit funds through the U.S. financial system.

Officials with the Federal Deposit Insurance Corp, Office of the Comptroller of the Currency and Federal Reserve, confirmed at the conference on Tuesday that they are working with FinCEN in an “advising, consultative” capacity as the bureau implements the AML reforms mandated by the NDAA.

The agencies, however, may have to tweak and revise their own regulations and exam procedures after the issuance of the national priorities, officials said, then take steps to ensure that financial institutions adequately incorporate them into their compliance controls.

“This will be a significant change for the banking industry to weave the national priorities into their programs,” said Lisa Arquette, associate director of the FDIC’s AML and cyberfraud division. “I believe it’s a good idea, but we just want to make sure that we are communicating with the industry and with our staff.”

Contact Valentina Pasquali at vpasquali@acams.org