Treasury Under Secretary Recommends BSA/AML Reform

Treasury Under Secretary for Terrorism and Financial Intelligence John K. Hurley recommended Bank Secrecy Act ("BSA") reforms, including shifting compliance from process-driven reviews to objective, results-focused measures.

At the Association of Certified Anti-Money Laundering Specialists Assembly Conference, Mr. Hurley argued that the current BSA and anti-money laundering ("AML") compliance framework produces too many low-value Suspicious Activity Reports. He said regulatory pressure and overly complex requirements drive this outcome, diverting compliance resources away from higher-risk activity. He warned that unnecessary documentation, repetitive continuing activity reviews, and excessive structuring reports waste time and money, introduce operational risk, and reduce the quality of intelligence available to law enforcement.

Mr. Hurley called for an outcomes-based approach to BSA/AML compliance and supervisory examinations, measuring effectiveness by how well institutions deliver timely, accurate intelligence to law enforcement rather than by adhering to process-heavy checklists. He pointed to the potential of technology—such as artificial intelligence, blockchain analytics, and digital identity tools—to improve reporting and cited FinCEN’s recent exemptive order on customer identification as a model of pragmatic reform.

Mr. Hurley also emphasized the need for closer collaboration among regulators, financial institutions, and law enforcement, supported by clear performance metrics and incentives that align compliance investments with better intelligence. He described a "once-in-a-generation" opportunity to recalibrate the AML and counter-terrorism financing framework and turn industry frustration into lasting reforms that strengthen both financial integrity and national security.