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Rulemaking would ease fraud-related information sharing
Eliminating the annual renewal requirements for financial institutions sharing information under Section 314(b) of the PATRIOT Act would make it easier for eligible financial institutions to participate. America’s Credit Unions wrote to the Financial Crimes Enforcement Network (FinCEN) Thursday detailing the need for a rulemaking.
Currently, credit unions seeking to participate in information sharing must renew their registration with FinCEN annually. Credit unions have told America’s Credit Unions that this is an unnecessary burden and a possible deterrent to participation. Statute requires participants to initially register, but not to renew annually.
“Once a financial institution provides notice to FinCEN to participate in section 314(b) information sharing, that notice should remain in effect unless the institution withdraws, becomes ineligible, or its information changes. At a minimum, FinCEN should extend the renewal period to three or five years,” the letter reads.
FinCEN issued guidance in June expanding the safe harbor to allow 314(b) participants to share certain fraud-related information, which America’s Credit Unions had previously advocated for. This guidance responds directly to issues raised.
The guidance provides clarity about the ability of credit unions and other financial institutions to share information concerning suspected fraud, and confirms that an institution does not need to identify specific fraud proceeds before sharing relevant information under the safe harbor.
This update could lead to additional credit union participation in information sharing, making an update to renewal requirements more necessary, the letter adds.