The SEC and FinCEN are proposing a rule to crack down on money laundering and terrorist financing in the investment adviser industry. This rule would require investment advisers to verify the identities of their clients, making it harder for criminals to misuse their services.
Key Points:
- Investment advisers would need to establish procedures to identify and verify customer identities.
- This helps prevent criminals from using fake identities to launder money or finance terrorism.
- The rule complements another proposal from FinCEN earlier this year that would classify investment advisers as “financial institutions” subject to anti-money laundering regulations.
- The public has 60 days to comment on the proposed rule.
Why it Matters:
- This proposal strengthens the US financial system by making it harder for criminals to use investment advisers for illicit activities.
- It protects investors from unknowingly doing business with criminals.
Next Steps:
- The public can comment on the proposed rule for 60 days.
- More information is available on the SEC website.
By FCCT Editorial Team
