In recent months, certain small banks have come under increased investigation by FinCEN, federal bank regulators, and in some instances the Department of Justice (DOJ) for alleged non-compliance with the Bank Secrecy Act (BSA) and alleged failure to implement effective anti-money laundering programs. It is important for small banks to keep this development in mind as money launderers move from larger financial institutions (who have “de-risked” their customer portfolios) to smaller ones and law enforcement takes notice. Regulators and the DOJ expect all financial institutions, regardless of size, to have a meaningful and effective AML program. In this article, the authors discuss the recent uptick in enforcement actions against smaller banks and the necessity to comply with BSA and AML program requirements regardless of size.
