Regulatory Alerts2012-09-17
Administrative Ruling Regarding the Participation of Associations of Financial Institutions in the 314(b) Program
FinCEN determined that a Delaware limited liability company wholly owned by financial institutions qualifies as an association of financial institutions eligible for the 314(b) information-sharing safe harbor. The ruling clarifies that while the entity meets technical requirements, the statutory protection applies only to information shared for detecting money laundering or terrorist financing, excluding data shared solely for fraud identification. FinCEN warned that the company's revenue-sharing model and restrictions on third-party data sharing may conflict with the statute's intent to facilitate broad information exchange among financial institutions.
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