Risk-based AML rules proposed for supervised banks in US

The US Federal Reserve has proposed a rule requiring supervised banks to develop and establish risk assessment processes directing more attention and resources toward higher-risk customers and activities.

It also proposes to add customer due-diligence as an express component of existing anti-money laundering and countering the financing of terrorism (AML/CFT) requirements, and to require banks' designated AML officers to be located in the US and accessible to regulators.

The rule reflects the proposal announcement issued by the Financial Crimes Enforcement Network (FinCEN) in April but is separate from it, aligning the Federal Reserve's AML rules with the _Anti-Money Laundering Act of 2020_. It affects approximately 858 institutions including state member banks, “Edge and agreement” corporations, as well as certain branches and agencies of foreign banks operating in the US.

Other aspects of the Federal Reserve’s proposals include:

- Expanding the list of approval options for a bank’s written AML/CFT program to include the board of directors, equivalent governing body or senior management.

- Introducing a supervision and enforcement framework that distinguishes between program establishment and program maintenance.

This would mean that supervisory or enforcement actions for deficiencies around implementation would be limited to “significant or systemic” failures.

The proposed effective date is twelve months from issuance of the final rule, provided that it is adopted by the Federal Reserve following consultation. Comments on the consultation must be submitted by September 8 2026.