Crossing the AML Frontier

As the schedule below makes clear, Treasury Deputy Secretary Wally Adeyemo will bring his agency’s updated wish list before Senate Banking on Tuesday.  The principal focus of the session is sure to be digital assets, with Treasury refining its prior plan to bring them fully within the AML/CFT enforcement scope not just to the greatest extent possible under current law, but also after key revisions.  Democrats will be most receptive, with Sen. Warren (D-MA) using the session to propel her stalled bill to revise the law to bring what she calls cryptocurrency fully within it.  This is a bipartisan bill, but we still expect many Republicans to complain that data does not support Treasury’s concerns in this sector.  Republicans led by Ranking Member Scott (R-SC) are sure also to use the session to complain that big banks are using SARs to target January 6 protesters and others with whom they do not agree, alleging also that Treasury has pressed banks to do so for its own political purposes.  Sen. Scott has sent a strongly-worded letter on this topic and it is a still more high-priority issue in the House.  As always, an in-depth analysis will follow the hearing pointing to key actions and any changes to the challenging path ahead for the Warren-Marshall bill now that it was omitted from Majority Leader Schumer’s priority list.