On July 21, 2025, the US Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) announced1 its intention to delay the effective date for certain investment advisers to implement anti-money laundering/countering the financing of terrorism (AML/CFT) compliance programs and comply with suspicious activity reporting requirements from January 1, 2026, to January 1, 2028. At the same time, FinCEN also announced its intention to revisit the scope of the impending AML/CFT requirements and certain other proposed requirements through future rulemaking.
Background
In September 2024, FinCEN published a final rule subjecting registered investment advisers (RIAs) and exempt reporting advisers (ERAs) to the Bank Secrecy Act (BSA) and requiring them to establish an AML/CFT program that is risk-based and reasonably designed to prevent them from being used for money laundering, terrorist financing or other illicit activities (the IA AML Rule) no later than January 1, 2026.2 The IA AML Rule imposes a host of new obligations on RIAs and ERAs, such as filing suspicious activity reports and currency transaction reports, appointing an AML compliance officer, and conducting independent testing. The AML/CFT program also must include risk-based procedures for conducting due diligence on advisory clients.
The Postponement of the IA AML Rule and Next Steps
FinCEN anticipates issuing an exemptive order formally extending the effective date to January 1, 2028. During this two-year delay, FinCEN anticipates undertaking rulemaking that reconsiders the scope and substantive provisions of the IA AML Rule. Also during this period, FinCEN, in conjunction with the US Securities and Exchange Commission, will revisit the rule they jointly proposed in May 2024, which would require RIAs and ERAs to implement customer identification programs and identity verification procedures (the IA CIP Rule).3
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Eversheds Sutherland Insight
FinCEN’s announcement provides additional time for affected investment advisers to develop the requisite risk-based policies, procedures and controls reasonably designed to mitigate their AML/CFT risk. While many RIAs and ERAs have already established at least some basic elements of AML/CFT programs voluntarily, any forthcoming IA AML Rule will likely impose formal requirements related to customer due diligence, training, testing and suspicious activity reporting, among other obligations.
RIAs and ERAs may therefore consider utilizing this additional time to assess whether their current AML/CFT program is sufficient to satisfy the future BSA requirements. Enhancing these programs now could help ensure that these advisers are well positioned to comply with any final rulemaking in this area.
It is also worth monitoring for anticipated further rulemaking in this space, including any proposals generated out of the anticipated reassessment of the final IA AML Rule and proposed IA CIP Rule. These rulemaking processes may provide an opportunity for impacted entities to further engage with regulators and collaboratively arrive at a rule set that properly balances the regulators’ interest in mitigating certain AML risks with the asset management industry’s interest in reducing unnecessary and duplicative compliance burdens.
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1 US Department of the Treasury - Treasury Announces Postponement and Reopening of Investment Adviser Rule.
2 Federal Register - Financial Crimes Enforcement Network: Anti-Money Laundering/Countering the Financing of Terrorism Program and Suspicious Activity Report Filing Requirements for Registered Investment Advisers and Exempt Reporting Advisers.
3 Federal Register - Customer Identification Programs for Registered Investment Advisers and Exempt Reporting Advisers.
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