What Is The Bank Secrecy Act?
The Bank Secrecy Act (BSA) is the United States’ most important anti money laundering regulation: banks and other financial institutions must ensure they meet the compliance obligations it involves.
Introduced in 1970, the Bank Secrecy Act requires financial institutions to work with the US government to combat financial crime. Also known as the ‘Currency and Foreign Transactions Reporting Act’, the BSA is primarily concerned with preventing money laundering, although it has been amended over the years by legislation such as the Patriot Act, which expanded its scope to include terrorist financing activities.
The BSA is intended to not only aid the fight against money laundering but to ensure that banks and financial institutions are not used as tools to facilitate it. Under the BSA, institutions must work to detect and monitor potential money laundering activities, and report them to the authorities so that enforcement actions can be taken.
The Bank Secrecy Act is administered by the Financial Crimes Enforcement Network (Fincen) which imposes a variety of compliance obligations on financial institutions. To meet those obligations, senior management should ensure that they have a detailed understanding of the legislation itself.