Effective Date for IA AML Rule Delayed

In July 2025, FinCEN announced that adoption of the IA AML Rule has been pushed back from January 1, 2026, to January 1, 2028.

In addition, FinCEN announced that it plans to reassess the IA AML Rule to determine if structure, requirements and parameters are sound.  This does not mean that newly covered entities proposed under the amended rule will be removed, but there may be changes to compliance obligations or exemptions.

However, the delay means that the newly added Covered Entities like some Exempt Reporting Advisers, and Registered Investment Advisers are NOT required to implement the IA AML Rule just yet.

The public will have an opportunity to weigh in during this process.

NOTE: The current IA AML rule is still in effect for Broker-Dealers, dually registered (or affiliated) RIAs, and other Covered entities under the original AML rule. Failure to continue to meet these compliance requirements may result in investigation or enforcement actions.

The announced delay provides a reprieve, particularly for businesses that fall under the newly added Covered entities like certain Exempt Reporting Advisers (ERAs), and Registered Investment Advisers (RIAs), however, it is not an excuse to delay preparing for possible implementation. Here are several factors to keep in mind as you progress towards a strong AML Program.

For New Covered Entities Under the Amended AML Rule (RIAs, ERAs)

Despite the delay, it is important to consider what the impending IA AML rule requires so that you can advance your compliance program, as necessary.  For example, consider how you will:  program.

• Tailor your AML compliance program to your specific business risks.
• Provide ongoing customer due diligence (CDD) and monitoring.
• Develop policies and procedures for identifying suspicious activity and reporting it.
• Provide ongoing training, recordkeeping, and testing of the program’s effectiveness.

For Covered Entities Under the Existing AML Rule (Broker-Dealers, Dually Registered Entities and Other Covered Entities)

Those who are already required to comply with the AML Rule should continue to meet the current standards while carefully reviewing and adjusting for any refinements to the existing rule including in areas such as:

• Expanded Customer Due Diligence (CDD) including Customer Identification Program (CIP), a verification process for all clients, and continuous monitoring of client activities.
• Suspicious Activity Reporting (SAR) including processes in identifying red flags and protocol for reporting suspicious activity.
• AML Program Implementation including development and implementation of policies tailored to the firm’s needs, training, oversight and thorough documentation and recordkeeping.

Jacko Law Group helps firms to establish AML Program controls.  We will continue to monitor developments with the IA AML rule and keep you apprised. For questions or concerns regarding your current AML compliance program, please contact us at 619.298.2880 or email [email protected].