NAFCU Flash Analyzes BSA Compliance Burden, Cost

ARLINGTON, Va.-Nearly half of federal credit unions surveyed for NAFCU’s monthly Flash Report said they either hired staff or a third-party vendor to help with Bank Secrecy Act compliance issues. “The increased focus on the Bank Secrecy Act by NCUA and FinCEN (the Financial Crimes Enforcement Network) has increased the regulatory burden of credit unions,” according to the Flash. “Most credit unions have spent considerable amounts of money and dedicated a portion of staff time in order to comply with the heightened expectations.” Just 11% of respondents said they had hired additional staff in the past year to aid with BSA compliance while 37% said they hired a third-party auditor or consultant. Another 17% plan to hire such a person shortly. Hiring consultants cost a median of $3,000, the Flash results indicated. Twenty-one percent of federal credit unions had purchased computers or software in the last 12 months to help with compliance with a median price tag of $7,500. More than a quarter, or 26%, of those that have not purchased equipment yet plan to in the near-term. “Seventy-sixpercent of credit unions indicated that they provided BSA compliance training to over three quarters of their staff. This is good news as credit unions seem to be adequately preparing for BSA compliance,” NAFCU Senior Economist Jeff Taylor observed. Another 16% said they trained more than half of the staff. Most, 64%, used in-house courses and 35% employed in-house videos. In-house Internet and computer-based training were used by 34% of the credit unions. Twenty-one percent used external seminars to train employees on BSA concerns. In the last year, 39% of the surveyed credit unions purchased training materials from a vendor. Eleven percent spent more than $2,000 on BSA compliance training materials. Another 17% responded that they spent between $1,501 and $2,000 on training materials. Twenty-two percent doled out $1,001 to $1,500, while half spent $500 to $1,000 on the materials. “Credit unions appear to be successfully positioning themselves for compliance with the BSA and its implementing regulations,” the survey concluded. “However, NCUA and the other regulators should keep in mind the significant regulatory and cost burdens associated with the BSA, and appropriately make every effort to lessen the burden.” -