This Week in AML

Treasury Dept Issues Review of 2021 Activities

This week the US Treasury issued its Year in Review: Treasury’s Top Accomplishments During Year One of the Biden-Harris Administration. The release looks at a broad set of areas for which the Department is responsible. John and Elliot discuss items in the National Security and Protecting the Financial System sections of the release.



Treasury Dept Issues Review of 2021 Activities TRANSCRIPT


Elliot Berman: John, how are you today?


John Byrne: Hey, Elliot, how [are] you doing?


Elliot Berman:  I'm good. Good win this week by Marquette on the road. So, that gives you and I something to cheer about.


John Byrne: Exactly. Beating Seton Hall and Villanova in one week is pretty exciting.


Elliot Berman:  It is pretty exciting. So, the treasury department posted, let me get the title exactly right, Year in Review, Treasury's Top Accomplishments During Year One of the Biden Harris Administration. The department has done this for years under all the administrations, but it's an interesting thing. I'm assuming you saw that was posted on their website.


John Byrne: Right. I thought of two things. One is, yeah, you're right. This happens in every administration. It's important for agencies not so much to tout their successes but to sort of explain the scope of their coverage.


This is really for those of us in AML. We know that the Treasury Department has as many areas that they're involved in, but this really brings it home, from the financial to national security, to the issues that we pay attention to. So, I think from that standpoint, [it's] interesting to look at as to see both scope and some of the things that they identify as issues as well as successes. 


Elliot Berman:  So, focusing first on the section called Safeguarding our National Security, what did you see there that you thought was interesting and particularly of interest to our listeners?


John Byrne: Why? I think, you know, they identify the fact that they've done a review of financial sanctions. We've talked about that before. So, the sanction space is obviously embedded in AML in 2022. And so that review that came out a bit ago has recommendations, talks about what it does. The sanctions issue, frankly, came up yesterday in President Biden's press conference because of how to respond to things like what unfortunately may happen between Russia and Ukraine.


Like what do you do with sanctions? If you go on your own. Know, it's unilateral sanctions versus sanctions supported by your partners in NATO or other countries. So, I think understanding the sanctions focus, that was one that made sense. Then identifying issues that we've also talked about that become more and more important than that virtual currency issues. Cybersecurity, which we have talked about.


They talk about ransomware. Then they focus on FinCEN, which has done a lot of things, as we know, because of AMLA (Anti-Money Laundering Act), but two of the things that they highlight are the proposed rule on beneficial ownership—of course, looking at potentially dealing with more requirements in the real estate market. So, all of those things and sorta, again, confirming both what we've been talking about, but also issues that the Treasury has their hand in their overseeing or they're partnering with other agents.


Elliot Berman:  Yes. They do cover, as you mentioned earlier, a lot of different spaces. Just to read the headlines, they talk about advancing equity. They talk about identifying items in tackling the climate crisis, which is rapidly becoming an issue for financial services broadly and, as a name, is really being viewed by many countries as a national security issue.


Protecting the financial system, which makes sense, given their role. This is an interesting one, restoring American leadership to deliver prosperity and stability for Americans and our partners and then fostering robust economic recovery. They talk a little bit about some general economic trends.


One of the things in protecting the financial system, one that I thought was interesting that they focused on, is the work of the president's working group on financial markets together with OCC and FDIC. The report that they issued laying out a regulatory framework for stable coins, and we've talked about, you know, as you look at virtual currencies, then you get into other related or tangential items, stable coins being one of them.


I know on a podcast that you recorded this week that we're posting to the website that stable coins came up as a discussion in looking at the FATF activity and recent guidance related to virtual currencies and stable coins. So, again, many of the things that [the] Treasury's working on are things of global interest being worked on by other agencies or cooperatively with Treasury across the financial sector, not worrying about borders.


John Byrne: Right. One other thing that came out today, as well as the year in review, was an announcement on additional sanctions on what they're calling Russian-backed actors that are responsible for destabilization activities in Ukraine. That was obviously a theme from yesterday's press conference regarding like we said, the potential for issues more than issues in Ukraine for destabilization. So today, the Treasury identified at least four individuals they are targeting that they believe [are] trying to undermine and impact Ukraine. So, I think that's also important.


You know, again, sanctions are such a key part, a key tool for national security. I think we're going to continue to see more and more use of that tool, especially in a number of these conflict areas.


Elliot Berman:  Agreed. So why don't you talk about the two webinars that we're working on for next week?


John Byrne: Right. So, the first one is, on Monday, January 24th, 12:00 PM eastern time. We're utilizing our platform to assist the ACAMS DC chapter, and it's on sports betting. So, sports betting as an AML issue, an excellent presenter, Patrick Barton from MGM, will be speaking along with Steve, who runs the SAR review team here in Northern Virginia.

So, I know that's also an intriguing [and] important issue for us. Then on January 27th at 1:00 PM Eastern, another edition of our AML voices webinar, why transaction monitoring isn't working like it should and what we can do to fix it. So, I think that's also going to be valuable to our community.


Elliot Berman:  Agreed. Again, if you'd like this week's edition of This Week in AML and our other AML Conversations podcasts, you can find us on Spotify, Apple Podcasts, or wherever you get your podcasts. So, please sign up, tune in, and we'll be back with you next week. John, have a great weekend, and I'll talk to you next week.


John Byrne: Stay safe. Talk to you soon. 


Elliot Berman: You too. Bye-bye.