WASHINGTON (CN) - Non-bank residential mortgage lenders and originators must create anti-money laundering programs to comply with the Bank Secrecy Act, according to regulations proposed by the Financial Crimes Enforcement Network.
At minimum these programs must include the development of internal policies, procedures, and controls to spot suspect transactions, the designation of a compliance officer to monitor record keeping, ongoing employee training, and an independent audit function to test if the program is meeting standards established under the act.
According to the agency, mortgage brokers and originators are "the primary providers of mortgage finance--in most cases dealing directly with the consumer--and are in a unique position to assess and identify money laundering risks and fraud while directly assisting consumers with their financial needs and protecting them from the abuses of financial crime."
If adopted, the proposed rules would close the gap between banking institutions that must comply with the act, including the filing of Suspect Activity Reports with the Financial Crimes Enforcement Network when lenders spot suspect financial transactions, and non-bank lenders that have been exempt from many provisions of the Bank Secrecy Act while the agency determined how to apply the act to real estate transactions.
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