Regulatory Compliance for Financial Institutions – Industry News

FinCEN proposes to expand financial institution customer due diligence requirements

The proposal would require financial institutions to identify beneficial owners of legal entities and codify existing customer due diligence guidance. In a continuing initiative to strengthen the customer due diligence (CDD) requirements imposed on regulated financial institutions under the Bank Secrecy Act (BSA),[1] on July 30, the Financial Crimes Enforcement Network (FinCEN) published a notice of proposed rulemaking (NPR). The primary purpose of the NPR is to propose new CDD obligations for all financial institutions that are required under the BSA to have in place anti-money laundering (AML) programs and customer identification programs (CIPs).[2] These (covered) financial institutions include banks, broker-dealers, open-end investment companies (mutual funds), futures commission merchants (FCMs), and introducing brokers in commodities (IBs). The proposed rules, if adopted, would [Read more…]  

Canada Banks Tally Their Tax-Compliance Tab

A U.S. law aimed at cracking down on tax evasion by expatriates has collectively cost Canada’s five biggest banks about 750 million Canadian dollars (US$693.5 million) in initial compliance expenses, according to people familiar with the matter.

The Foreign Account Tax Compliance Act, or FATCA, which took effect July 1, has banks around the globe working to meet the requirements of legislation that many countries have complained seeks to extend Washington’s reach beyond U.S. borders. [Read more…]


Judicial Oversight of Governmental Consent Decrees in Wake of ‘Citigroup’

Barry J. Pollack and Addy R. Schmitt of Miller Chevalier Chartered, discuss the recent case ‘SEC v. Citigroup’, where the U.S. Court of Appeals for the Second Circuit reversed an order refusing to approve a proposed consent decree that would have settled a regulatory enforcement action the SEC had brought against Citigroup. They write: “Whether or not the Second Circuit’s decision makes sense in the context of the facts and the parties before it, the highly deferential standard of district court review of such consent decrees articulated by the Second Circuit may prove to be overly restrictive when applied in other settings.” [Read more…]  

7 legal stories every inside counsel should know right now

The financial crisis of 2008 had a tremendous impact on the political and business landscape. James Odell, now a partner at Blank Rome LLP had a front row seat for these events, as he held high-ranking positions in the legal departments of various large international banks during the collapse. Odell recently spoke with InsideCounsel to discuss the changes he has seen in the regulatory landscape over the past 14 years. “What characterized 2001-2005,” he says, “was that other regulators and law enforcement folks were stepping into a vacuum. State attorneys general were ramping up their focus, really for the first time, and we were dealing with people outside of normal regulatory relationships.” [Read more…]  

Canadian banks win praise rather than scorn from regulators in contrast to U.S.

OSFI’s assessment of the situation in Canada stands in sharp contrast to a statement this week about U.S. banks from Thomas M. Hoenig, vice-chairman of the U.S. Federal Deposit Insurance Corporation. He deemed the plans of the U.S. banks “deficient” and said that each “fails to convincingly demonstrate how, in failure, any one of these firms could overcome obstacles to entering bankruptcy without precipitating a financial crisis.” [Read more…]    

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