NYS Banking Regulator’s Requirements for Transaction Monitoring and Filtering

On June 30, 2016, the New York State Department of Financial Services adopted a final regulation outlining the attributes of a risk-based transaction monitoring and filtering program that certain New York State-licensed institutions will be required to maintain (the “Final Rule”). The Final Rule includes several notable departures from the proposal that was issued by the NYSDFS on December 1, 2015 (the “Proposed Rule”). The Final Rule, which is the first significant rulemaking to be finalized under the direction of the new Superintendent of Financial Services, Maria T. Vullo, is another example of the NYSDFS asserting its role in establishing standards for compliance by banks with anti-money laundering, terrorist financing and sanctions laws.