AML Compliance Legal Services
Anti-money laundering compliance is a core regulatory obligation for financial institutions, investment advisers, fund managers, broker-dealers, money services businesses, and — increasingly — fintech companies and digital asset platforms. The Bank Secrecy Act (BSA) and its implementing regulations, enforced by the Financial Crimes Enforcement Network (FinCEN), establish the framework for detecting and reporting suspicious financial activity, identifying beneficial owners, and preventing the use of the financial system for money laundering, terrorist financing, and other illicit purposes.
FinTech Law provides AML compliance legal services to investment advisers, private and registered funds, fintech companies, digital asset firms, and money services businesses. Our practice combines deep understanding of BSA/AML requirements with expertise in the broader securities regulatory and fintech landscape, allowing us to design AML compliance programs that satisfy regulatory expectations while operating efficiently within your business model.
Our AML Services
AML Program Design and Implementation
Every financial institution subject to the BSA must establish and maintain a written AML compliance program. The specific requirements vary by entity type, but the core elements are consistent: a system of internal controls and procedures for BSA compliance, designation of an AML compliance officer, ongoing employee training, independent testing (audit) of the AML program, and risk-based customer due diligence (CDD) procedures including beneficial ownership identification.
FinTech Law designs AML programs tailored to your specific risk profile, business model, and regulatory classification. We draft AML policies and procedures, establish customer identification program (CIP) requirements, develop risk-based CDD and enhanced due diligence (EDD) frameworks, create suspicious activity monitoring protocols, and build the documentation infrastructure that examiners expect to see when they review your program.
For fintech companies and digital asset platforms, AML program design must account for the unique risks of digital transactions — including the speed of transactions, the pseudonymous nature of blockchain addresses, the use of mixing services and privacy coins, and the cross-border nature of digital asset transfers.
Customer Due Diligence and KYC
Know Your Customer (KYC) is the foundation of AML compliance. CDD requirements mandate that financial institutions identify and verify the identity of their customers, understand the nature and purpose of customer relationships, and conduct ongoing monitoring to identify suspicious activity. The FinCEN CDD Rule expanded these requirements to include identification and verification of beneficial owners of legal entity customers.
FinTech Law advises on CDD program design, including risk-based customer risk scoring methodologies, identity verification procedures for both individual and entity customers, beneficial ownership identification and verification, enhanced due diligence for higher-risk customers (PEPs, foreign correspondents, high-risk jurisdictions), and ongoing monitoring procedures to detect changes in customer risk profiles.
For digital asset businesses, KYC presents particular challenges around pseudonymous transactions, cross-chain activity, and the identification of counterparties on decentralized platforms. We help design KYC frameworks that satisfy regulatory requirements while preserving user experience.
Suspicious Activity Reporting
The obligation to file Suspicious Activity Reports (SARs) is one of the most critical — and most scrutinized — elements of BSA compliance. Financial institutions must monitor customer activity for transactions that may indicate money laundering, terrorist financing, fraud, or other specified unlawful activity, and file SARs with FinCEN when suspicious activity is detected.
FinTech Law advises on the design of transaction monitoring systems and alert investigation procedures, the legal standards for determining when a SAR filing is required, the preparation of SAR narratives that meet FinCEN expectations, Currency Transaction Report (CTR) filing procedures for cash transactions exceeding $10,000, and the confidentiality provisions that prohibit disclosure of SAR filings to the subjects of reports.
We also advise on the legal protections available to institutions that file SARs in good faith (safe harbor provisions) and the potential liability for failure to file when required.
OFAC Sanctions Compliance
The Office of Foreign Assets Control (OFAC) administers economic sanctions programs that prohibit U.S. persons and entities from conducting business with sanctioned individuals, entities, and jurisdictions. OFAC compliance is a strict liability regime — meaning violations can result in significant penalties regardless of intent or knowledge.
FinTech Law advises on OFAC compliance program design, including screening procedures against the Specially Designated Nationals (SDN) list and other OFAC lists, procedures for addressing potential matches, blocking and rejecting requirements for prohibited transactions, and recordkeeping and reporting obligations. For digital asset businesses, OFAC compliance requires specific attention to blockchain address screening and the risks associated with transactions involving sanctioned jurisdictions or addresses.
AML Regulatory Examinations
BSA/AML compliance is a priority focus area for every financial regulator. SEC examinations regularly assess investment adviser and broker-dealer AML programs. FinCEN conducts direct examinations and enforcement actions. State regulators review AML programs as part of licensing examinations for money services businesses and money transmitters.
FinTech Law helps clients prepare for and respond to AML examinations, including organizing documentation, preparing staff for examiner interviews, addressing examination findings, and implementing remedial measures if deficiencies are identified. Our SEC compliance practice provides additional depth for examination preparation.
