FDIC Board Advances Proposed Bank Secrecy Act Rule for Stablecoin Issuers

The FDIC approved a notice of proposed rulemaking to set Bank Secrecy Act and sanctions compliance standards for FDIC-supervised permitted payment stablecoin issuers. The proposal would amend 12 CFR Part 350 and add a new subpart covering AML/CFT supervision and enforcement. Permitted payment stablecoin issuers are approved to issue payment stablecoins under federal oversight, with the FDIC serving as the primary regulator for certain PPSIs that are subsidiaries of insured state nonmember banks and state savings associations. The requirements would mandate AML/CFT programs, economic sanctions programs, and reporting obligations. The enforcement framework would include cease-and-desist orders, written agreements, consent orders, memoranda of understanding, and civil money penalties, working alongside FinCEN and OFAC rules.

"The FDIC announced on May 22 that its board approved a notice of proposed rulemaking for Bank Secrecy Act (BSA) and sanctions compliance standards covering FDIC-supervised permitted payment stablecoin issuers (PPSIs). The proposal would implement requirements under the Guiding and Establishing National Innovation for U.S. Stablecoins Act (GENIUS Act). A PPSI is an issuer approved to issue payment stablecoins under federal oversight."

"Under the GENIUS Act, the FDIC serves as the primary federal regulator for PPSIs that are subsidiaries of insured state nonmember banks and state savings associations approved by the agency. The proposal would require these issuers to follow anti-money laundering and counter-terrorist financing programs, economic sanctions programs, and reporting requirements. The FDIC wrote: The proposed rule aims to establish appropriate principles-based BSA and sanctions compliance requirements and standards."

"The proposal would amend 12 CFR Part 350, the FDIC's payment stablecoin regulation. The change would add BSA and sanctions compliance standards for FDIC-supervised PPSIs and create a new subpart covering AML/CFT supervision and enforcement. Those requirements would work alongside rules from the Department of the Treasury's Financial Crimes Enforcement Network (FinCEN) and the Office of Foreign Assets Control (OFAC)."

"The FDIC's enforcement framework would define AML/CFT enforcement actions to include cease-and-desist orders, written agreements, consent orders, memoranda of understanding, and civil money penalties. It also wo"

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