US Federal Reserve Proposes to Modernize Anti-Money-Laundering Rules for Banks

The Federal Reserve Board has requested public comment on a proposal to amend its requirements for banks to maintain anti-money-laundering programs. Announced on 7 July, the move is part of a broader interagency effort to modernize the framework that financial institutions use to detect and prevent illicit financial flows, and to align supervisory expectations with recent updates to federal anti-money-laundering law. The proposal is intended to encourage banks to run programs that are effective, risk-based and proportionate, directing compliance resources toward the areas of greatest concern rather than treating every requirement as equally burdensome. Regulators have argued that a more risk-focused approach can strengthen the fight against money laundering and terrorist financing while reducing unnecessary costs for institutions. The consultation invites feedback from banks, industry groups and the public before any changes are finalized, and it is expected to be coordinated with other US regulators overseeing the banking system. The initiative reflects a wider supervisory theme of updating long-standing rulebooks to reflect current risks, technology and business practices across the financial sector.