Broker-dealers get compliance relief on AML surveillance
Washington, DC -- Broker-dealers will not have to perform anti-money laundering (AML) surveillance on customers they share with registered investment advisors, according to the market regulation division of the Securities and Exchange Commission (SEC).
The market regulation division said in mid-February in a ‘no action’ letter to the Securities Industry Association (SIA) that it would allow broker-dealers to depend on investment advisors to perform account surveillance for the purposes of the USA Patriot Act. It also said it would permit broker-dealers to do so, even though investment advisors are not yet subject to the Customer Identification Rule (CIP).
The reliance -- once the CIP rules are in place -- would be acceptable only if all
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