FinCEN Director Signals Stricter BSA/AML Compliance in Congress Testimony
FinCEN’s Andrea Gacki testified on BSA/AML reforms emphasizing risk-based, outcome-focused compliance.
Why it matters: Corporate legal and compliance teams in financial services must prepare for intensified regulatory scrutiny and updated expectations under a new risk-oriented framework.
- On July 21, 2026, FinCEN Director Andrea Gacki testified before Congress outlining a shift to risk-based, outcome-oriented BSA/AML compliance.
- FinCEN proposed a rule on April 7, 2026, to reform AML/CFT programs, focusing on effectiveness and prioritizing higher-risk areas.
- The rule introduces a two-prong review process with new supervisory and enforcement frameworks and mandates risk assessments.
- FinCEN plans to soon finalize a revised beneficial ownership reporting rule, as stated by Gacki in her testimony.
On July 21, 2026, FinCEN Director Andrea Gacki testified before the House Financial Services Subcommittee, emphasizing a transformative approach to Bank Secrecy Act (BSA) and Anti-Money Laundering (AML) compliance.
FinCEN’s proposed rule, announced April 7, 2026, aims to shift away from a process-driven compliance model toward a risk-based and outcome-oriented framework. The rule encourages financial institutions to allocate their compliance resources toward areas of higher risk, enhancing the overall effectiveness of their anti-money laundering and countering the financing of terrorism (AML/CFT) programs. As Gacki explained, "The proposed rule challenges that premise directly. It asks whether those activities actually worked."
The proposal introduces a two-prong review process that includes a new supervisory and enforcement framework targeting banks. Crucially, it codifies the requirement for financial institutions to conduct risk assessments as part of their compliance obligations. This marks a significant regulatory shift designed to improve the quality and impact of compliance efforts.
In her testimony, Gacki also announced that FinCEN is close to finalizing important updates to the beneficial ownership reporting rule, which will further enhance transparency and the detection of illicit financial activities. "We are very close to the finish line," she stated.
Compliance officers and corporate legal teams should closely monitor these developments as FinCEN finalizes the rules and begins implementing enhanced supervisory and enforcement measures.
By the numbers:
- April 7, 2026 — FinCEN proposed rule announced to reform AML/CFT programs
- June 9, 2026 — Deadline for public comments on the proposed BSA/AML rule
- July 21, 2026 — Testimony by FinCEN Director outlining regulatory priorities
What's next: FinCEN is expected to finalize the revised beneficial ownership reporting rule soon, marking a critical next step in the reform process.