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Business Crimes BulletinFeaturesRegulationWhite Collar Crime

Anti-Money Laundering Enforcement Update

By Kyle R. Freeny and Benjamin G. Greenberg
March 01, 2021

Over the last decade or so, anti-money laundering (AML), counter-terrorism financing (CFT), and sanctions compliance have been the subject of increased enforcement efforts by the Department of Justice (DOJ), Department of Treasury, and federal financial regulators. We expect this trend to accelerate in 2021 and beyond, propelled at least in part by the recent enactment of the Anti-Money Laundering Act of 2020 (2020 AMLA). Passed with overwhelming bi-partisan support as part of this year's National Defense Authorization Act, the 2020 AMLA may well have the most significant impact on the AML/CFT landscape since enactment of the USA PATRIOT Act. Among other things, the 2020 AMLA creates several new tools that law enforcement can employ to investigate and prosecute illicit finance, described further below.

Amplifying the likely effect of this legislation, these law enforcement tools will be handed to new DOJ leadership under the incoming Biden administration, which is expected to be more focused on white collar crime than the outgoing administration, and more willing to investigate mainstream U.S. companies, including depository and non-depository financial institutions.

Looking ahead, several likely enforcement trends are worth highlighting:

  • Increased willingness to bring enforcement actions against mainstream U.S. companies for AML/CFT compliance lapses;
  • Heightened focus on complicit professionals, such as bankers, accountants, and real estate professionals, whose conduct may also expose employers to vicarious liability;
  • Enforcement related to the new corporate beneficial ownership registry created by the 2020 AMLA; and
  • Iincreased focus on transnational illicit finance, including through cooperation with foreign counterparts.

Increased Enforcement Risk for AML/CFT Compliance Lapses

The Department of the Treasury, in its most recent National Illicit Finance Strategy, identified ongoing corporate compliance weaknesses as one of the U.S. financial system's key vulnerabilities to money laundering and other illicit finance. It is reasonable to expect that the incoming Biden administration, with its appetite to address perceived corporate misconduct, will channel law enforcement resources to this area. And when it does so, it will have new tools available to it under the 2020 AMLA that merit the attention of corporate counsel.

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