The American Bankers Association (ABA) has released a set of recommended policy changes with regard to Bank Secrecy Act/Anti-Money Laundering (BSA/AML) enforcement.

The banking trade association unveiled what it calls the “New Framework for Partnership,” a set of recommendations developed by leading AML experts. The ABA said it developed the plan “to help the next administration fight financial crime.”

ABA’s recommended changes include:

• Create an independent BSA gatekeeper to oversee and coordinate the BSA regime and to promote system integrity and efficiency. ABA expects this change to reduce the likelihood of prosecutors using criminal remedies against financial institutions with BSA/AML shortcomings.
• Explicitly endorse a priority-focused, risk-based approach to BSA regulation. This would result in greater agency deference toward the bank’s own assessment of its risks.
• Increase the quality of feedback and transparency. Some progress has been made in this area, ABA admits, but more action is needed.
• Streamline reporting and validate its utility. The ABA says banks need more information on exactly how their reports are used in criminal cases.
• Avoid using criminal penalties against banks that fail to meet administrative standards for compliance. Leave these matters to the bank regulators, which can use cease and desist orders to clean up problems.

“Improving the effectiveness of our efforts against financial crime needs to be a key part the next president’s regulatory reform agenda,” said Edward Yingling, president and CEO of the ABA. “We need to build upon the current system by improving efficiency and focusing our priorities squarely on apprehending financial felons and guarding against terrorism financing.”