Overview
On July 21, 2025, the US Department of the Treasury's Financial Crimes Enforcement Network (FinCEN) announced its intention to postpone the effective date of the final rule adding certain investment advisers to the definition of "financial institution" (the "IA AML Rule")1 in regulations enacted under the Bank Secrecy Act (BSA). FinCEN also announced that it would revisit the scope of the IA AML Rule at a future date, reopening the rulemaking efforts.
The IA AML Rule proscribed minimum standards for anti-money laundering/countering the financing of terrorism ("AML/CFT") programs by registered investment advisers and exempt reporting advisers (collectively, "Covered Advisers"). The IA AML Rule required that Covered Advisers come into compliance by January 1, 2026. FinCEN anticipates delaying the effective date of the IA AML Rule until January 1, 2028.
The IA AML Rule was adopted nearly nine years after FinCEN attempted similar AML regulations for investment advisers in 2015, and prior efforts to apply AML/CFT requirements to the asset management industry in 2002 and 2003. The IA AML Rule sought to address ongoing illicit finance risks, threats, and vulnerabilities posed by criminals, and foreign adversaries that exploit the U.S. financial system and assets through investment advisers – particularly those identified in the 2024 Investment Adviser Risk Assessment.2
The asset management industry already has taken steps to implement AML programs and related procedures, voluntarily, and many investment advisers have been designing risk-based written AML/CFT programs and related procedures. FinCEN recognized that extending the effective date of the rule may help ease potential compliance costs for industry and reduce regulatory uncertainty while FinCEN undertakes a broader review of the IA AML Rule.
FinCEN recognized that the IA AML Rule must be effectively tailored to the diverse business models and risk profiles of Covered Advisers. FinCEN intends to revisit the substance of the IA AML Rule through a future rulemaking process and, together with the Securities and Exchange Commission, revisit the joint proposed rule establishing customer identification program rule requirements for investment advisers.
FinCEN's stated goal is to provide the asset management industry with regulatory certainty by issuing appropriate exemptive relief on or after January 1, 2028.
1 Final Rule, Anti-Money Laundering/Countering the Financing of Terrorism Program and Suspicious Activity Report Filing Requirements for Registered Investment Advisers and Exempt Reporting Advisers, 89 Fed. Reg. 72156 (Sept. 4, 2024).
2 Treasury, 2024 Investment Adviser Risk Assessment (February 2024), available at https://home.treasury.gov/system/files/136/US-Sectoral-Illicit-Finance-Risk-Assessment-Investment-Advisers.pdf
