In December 2021, the Financial Crimes Enforcement Network (FinCEN) issued substantial revisions to the Bank Secrecy Act/Anti-Money Laundering (BSA/AML) Examination Manual. These revisions were aimed at providing greater clarity and transparency in regulatory expectations and to support financial institutions in building more effective and tailored compliance programs. Among the major changes were clarifications to how risk assessments should be conducted, the expectations surrounding customer due diligence (CDD), and the role of beneficial ownership identification.

For compliance professionals, these updates signaled a shift toward a more pragmatic, risk-based approach where institutions are encouraged to evaluate their unique risk exposure rather than strictly adhering to uniform regulatory prescriptions. The manual now emphasizes proportionality, allowing institutions to adjust their AML efforts in relation to their size, complexity, and customer base. This has been particularly beneficial to smaller institutions that previously struggled with one-size-fits-all interpretations.

Another notable aspect of the update is the increased accountability placed on senior management. Compliance leaders are expected to play a more strategic role in aligning AML activities with the broader governance and operational strategy of the organization. The revisions also reflect FinCEN’s commitment to modernizing its AML oversight to keep pace with technological innovations, financial products, and emerging threats. Financial institutions must revisit their internal training programs, policy documentation, and compliance frameworks to ensure alignment with these updated expectations. As regulatory scrutiny intensifies, proactive adaptation remains the most viable defense against enforcement risks.