The New York State Department of Financial Services (“NY DFS”) recently finalized regulations (“Banking Regulations”) requiring state-chartered banking organizations, state-licensed branches and agencies of foreign banks, and state-licensed check cashers and money transmitters (“covered financial institutions”), to maintain “robust” transaction monitoring and filtering systems designed to better enable these financial institutions to comply with relevant federal and state anti-money laundering (“AML”) and federal economic sanctions regulations. The regulations also require specific board and/or senior management to review and execute a written “Compliance Finding” as to the financial institution’s compliance with the regulations.

This focus by the NY DFS towards the obligations of senior management follows similar changes to the UK regulatory regime, which the UK Financial Conduct Authority (“FCA”) has termed “the beginning of a new era of increased individual accountability.” While the recently implemented Senior Managers and Certification Regime (“SMCR”) in the UK is much broader in scope, it demonstrates common policy objectives of financial regulators in New York and London and highlights the need for responsible individuals to ensure that their business has adequate procedures in place across multiple jurisdictions to avoid AML and sanctions breaches.

Please access here a recent Norton Rose Fulbright update on these issues.