Joint Statement of Enforcement Policy in support of Venezuela’s Economic Recovery and Earthquake Relief Efforts

• US financial regulators (Fed, FDIC, NCUA, OCC) issued a joint statement on BSA/AML enforcement policy for Venezuela.
• The policy aims to support economic recovery, financial stability, and humanitarian aid following the June 24, 2026, earthquakes in Venezuela.
• From July 31, 2026, to January 29, 2027, agencies will not pursue enforcement actions for authorized financial services in Venezuela related to BSA/AML requirements.
• Financial institutions must maintain BSA compliance, have no recent BSA enforcement actions, and remain compliant with OFAC sanctions to qualify.
• This commitment protects institutions exercising reasonable care, but not those with knowing, willful, or intentional BSA violations.

The core intent behind this joint statement is to ensure that financial institutions acting with reasonable care to avoid violations of applicable BSA requirements, particularly in support of Venezuela's economic recovery and earthquake relief efforts, are not unduly penalized.

The Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, the National Credit Union Administration, and the Office of the Comptroller of the Currency have jointly issued a significant enforcement policy statement. This collective action by US financial regulators aims to bolster the U.S. Government's initiatives to foster economic recovery and financial stability within Venezuela. A key component of this policy is facilitating humanitarian relief and supporting reconstruction efforts following the recent devastating earthquakes in the region.

This joint declaration specifically addresses concerns that regulatory uncertainty could impede the timely delivery of crucial humanitarian assistance. The policy is designed to reassure financial institutions that are otherwise capable of providing essential financial services to Venezuela. It also serves to reinforce a substantively similar enforcement policy previously announced by the Department of Treasury’s Financial Crimes Enforcement Network (FinCEN) regarding its approach to Venezuela.

Under this new policy, the Agencies have committed that they will not initiate supervisory actions, including citing legal violations, or pursue enforcement actions against supervised financial institutions. This commitment specifically pertains to requirements under the Bank Secrecy Act (BSA), the USA PATRIOT Act, and other anti-money laundering (AML) laws administered by FinCEN and the Agencies, collectively referred to as "BSA Requirements." This relief is granted for institutions providing authorized financial services to individuals or entities located in Venezuela.

The policy's applicability is time-bound, covering authorized financial services rendered from July 31, 2026, through January 29, 2027. To qualify for this enforcement forbearance, financial institutions must meet three critical conditions. First, they must maintain an existing BSA compliance program and continue to make reasonable efforts to adhere to applicable BSA Requirements, while also considering the government's interest in rapidly delivering humanitarian relief and promoting financial stability in Venezuela. Second, the institution must not have been subject to a final BSA enforcement action by FinCEN or the relevant Agency within the preceding 24 months. Finally, institutions must remain fully compliant with all applicable sanctions regulations and authorizations administered by the Treasury’s Office of Foreign Assets Control (OFAC). This explicit mention of OFAC Venezuela sanctions compliance is crucial for institutions navigating the complex regulatory landscape.

The core intent behind this joint statement is to ensure that financial institutions acting with reasonable care to avoid violations of applicable BSA requirements, particularly in support of Venezuela's economic recovery and earthquake relief efforts, are not unduly penalized. The policy clarifies that enforcement actions will not be taken for actions other than knowing, willful, or intentional violations of any BSA Requirements. This distinction is vital for institutions seeking to provide Venezuela AML compliance relief without inadvertently incurring regulatory penalties.

By providing this temporary window of reduced regulatory risk, US financial regulators aim to encourage the flow of authorized financial services necessary for the region's recovery. It underscores a pragmatic approach to BSA enforcement policy, balancing the need for robust anti-money laundering controls with the urgent imperative of humanitarian assistance. However, it is important to note that this commitment is narrowly tailored and does not extend to statutes or regulations beyond those specifically addressed in the statement.

Lawyers and compliance officers should advise financial institution clients that US regulators will not pursue BSA/AML enforcement actions for authorized financial services in Venezuela supporting economic recovery and earthquake relief, provided institutions maintain existing compliance programs and OFAC adherence during the specified period. This creates a temporary window for facilitating aid with reduced regulatory risk.

Source: Original reporting via the Board of Governors of the Federal Reserve System and other Agencies.