The Financial Crimes Enforcement Network (finCEN), in conjunction with the Federal Reserve, proposed a new rule to make changes to the Bank Secrecy Act’s recordkeeping and travel rule regulations.
The recordkeeping rule is meant to preserve an information trail about persons sending and receiving funds through the funds transfer system, and is intended to help law enforcement and regulatory authorities to detect, investigate, and prosecute financial crimes such as money laundering.
The travel rule is a separate regulation that requires “banks and nonbank financial institutions to transmit information on certain funds transfers and transmittals of funds to other banks or nonbank financial institutions participating in the transfer or transmittal.”
The proposed modification would reduce the threshold for reporting certain funds transfers and transmittals of funds from $3,000 to $250 for those that begin or end outside of the United States.
“FinCEN is likewise proposing to reduce from $3,000 to $250 the threshold in the rule requiring financial institutions to transmit to other financial institutions in the payment chain information on funds transfers and transmittals of funds that begin or end outside the U.S.,” the proposed rule stated.
The threshold for domestic transactions would remain at $3,000.
The agency also proposed a clarification for the meaning of “money” to ensure the rules apply to domestic and cross-border transactions involving convertible virtual currency such as bitcoin and other cryptocurrency, and digital assets with legal tender status.
Anyone wishing to comment on the proposed rule should do so on or before Nov. 27, 2020.