by William R. Baker III, Douglas N. Greenburg, Benjamin A. Naftalis, Nabil Sabki, John J. Sikora Jr., Eric S. Volkman, Douglas K. Yatter, Timothy H. McCarten, and Hye Eun (Michelle) Cho
The Second Circuit’s recent decision gives the SEC the green light to continue enforcing broker-dealer compliance with the Bank Secrecy Act.
Key Points:
- In U.S. Securities and Exchange Commission v. Alpine Securities Corp., the Second Circuit affirmed the SEC’s authority to require broker-dealers to comply with the BSA’s reporting and recordkeeping requirements, under Section 17(a) and Rule 17a-8 of the Securities Exchange Act of 1934 (Exchange Act).
- The Alpine decision validates the SEC’s focus on broker-dealer AML programs. In anticipation of such scrutiny, broker-dealers and Chief Compliance Officers should evaluate whether their compliance programs satisfy existing anti-money laundering obligations, and particularly BSA reporting obligations.