America's Credit Unions is encouraging federal regulators to adopt a flexible, risk-based approach to anti-money laundering and counter-terrorism financing rules, arguing that new compliance frameworks should focus on meaningful outcomes rather than technical violations.
In three comment letters submitted this week to the Financial Crimes Enforcement Network and the National Credit Union Administration, the trade group backed efforts to modernize Bank Secrecy Act compliance requirements while cautioning against overly prescriptive regulations that could increase burdens on credit unions.
Regarding FinCEN's proposed overhaul of AML/CFT program requirements, America's Credit Unions supported a shift toward risk-based supervision that would focus examiner attention on significant or systemic failures rather than isolated technical errors. The organization urged regulators to provide flexibility for smaller institutions and avoid documentation requirements that do not improve anti-money laundering effectiveness.
The group also submitted comments on a companion NCUA proposal, encouraging the agency to align its examination standards with FinCEN's framework and ensure examiners distinguish between material compliance deficiencies and minor operational mistakes. America's Credit Unions warned that routine examiner observations should not trigger heightened supervisory actions.
A third letter focused on FinCEN's proposed anti-money laundering and sanctions requirements for permitted payment stablecoin issuers created under the GENIUS Act. America's Credit Unions requested additional guidance clarifying compliance expectations for credit unions and credit union service organizations that may become involved in stablecoin issuance or custody activities. The organization cited challenges associated with monitoring transactions on decentralized blockchain networks, where customer identities can be obscured and traditional compliance tools may be less effective.
Among its recommendations, the trade group called for clearer guidance on know-your-customer requirements, transaction monitoring, sanctions screening, parent-company responsibilities, and the use of third-party blockchain analytics providers.
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