Which regulation requires financial institutions to implement anti-money laundering programs?

The requirement for financial institutions to implement anti-money laundering (AML) programs is primarily established by the Bank Secrecy Act (BSA). The BSA, enacted in 1970, was designed to combat money laundering by imposing requirements on financial institutions to report various financial transactions to prevent and detect illegal activities such as money laundering. One of the key provisions of the BSA is the mandate for these institutions to develop and maintain effective AML programs, which include policies, procedures, and internal controls aimed at preventing, detecting, and reporting suspicious activities.

The BSA serves as the foundation for many subsequent regulations relating to AML compliance, including the provisions added by the USA PATRIOT Act that further strengthen the requirements. While the USA PATRIOT Act significantly enhances certain aspects of AML and expands the BSA's reach, the original and specific requirement for the establishment of AML programs is rooted in the Bank Secrecy Act itself.

The other regulations mentioned, such as the Gramm-Leach-Bliley Act, focus primarily on privacy and the sharing of non-public personal information, while the Truth in Lending Act is aimed at ensuring consumers are informed about the terms and costs of credit. Therefore, they do not specifically require the implementation of anti-money laundering programs.