U.S. Department of the Treasury outlines guiding principles for Bank Secrecy Act modernization and plans to streamline SAR and CTR reporting

The U.S. Department of the Treasury, in remarks by Deputy Secretary Michael Faulkender to the Bank Secrecy Act Advisory Group (BSAAG) plenary meeting, set out the Trump Administration’s guiding principles for modernizing Bank Secrecy Act implementation and the U.S. anti-money laundering and counter-terrorist financing (AML/CFT) regime. The principles emphasise regulation grounded in a clear statutory mandate, efficiency and cost-benefit balance, fairness and consistency, and more efficient and transparent regulatory action, with requirements tailored to firms’ risk profiles and business models. Treasury highlighted changes to BSAAG membership to double the number of small community banks and framed modernization as a shift toward national security priorities and highest-risk areas, while explicitly permitting institutions to de-prioritize lower risks consistent with the Anti-Money Laundering Act’s directive. Workstreams cited include exploring ways to streamline Suspicious Activity Report (SAR) reporting by improving the SAR form, pursuing similar efforts to reduce Currency Transaction Report (CTR) filing burdens, encouraging responsible innovation (including in digital assets), and providing financial institutions with more feedback on how SAR and CTR reporting is used. Faulkender said he has directed his team to work with financial regulators and other stakeholders to move expeditiously on modernization, with BSAAG members positioned as a key channel for industry input.