Compliance: Agencies clarify BSA due diligence for charities, nonprofits

Federal financial institution regulatory agencies, including NCUA, issued a joint fact sheetclarifying that credit union and compliance efforts to meet Bank Secrecy Act (BSA) due diligence requirements for customers that are charities and other nonprofit organizations should be based on the money laundering risks posed by the customer relationship.

The fact sheet highlights the importance of legitimate charities and nonprofit organizations having access to financial services and being able to transmit funds through legitimate and transparent channels, especially in the context of responding to the coronavirus pandemic.

It also clarifies that charities and nonprofit organizations as a whole do not present a uniform or unacceptably high risk of being used or exploited for money laundering, terrorist financing, or sanctions violations, and that financial institutions must develop risk profiles that are.

The fact sheet does not alter existing BSA/anti-money laundering legal or regulatory requirements or establish new supervisory expectations.

 

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