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FinCEN encourages FIs to stay in touch, be alert to scams

After President Trump declared a national emergency in response to the coronavirus, financial security became an even greater concern for credit unions and other financial institutions. FinCEN requested financial institutions affected by the COVID-19 pandemic to contact FinCEN and their functional regulator as soon as practical.

Financial institutions are encouraged to keep FinCEN and their functional regulators informed as their circumstances change.

“FinCEN has reiterated its approach related to when something interferes with you credit union’s BSA reporting obligations,” said Mike Lee, LSCU director of regulatory advocacy. “Essentially, if your credit union encounters delays in your required reports, contact FinCEN and your primary regulator. It is also warning credit unions to be particularly vigilant for scams associated with the pandemic and to promptly report those if you encounter them.”

FinCEN also advises financial institutions to remain alert about malicious or fraudulent transactions similar to those that occur in the wake of natural disasters. FinCEN is monitoring public reports and BSA reports of potential illicit behavior connected to COVID-19 and notes the following emerging trends:

1. Imposter Scams – Bad actors attempt to solicit donations, steal personal information, or distribute malware by impersonating government agencies (e.g., Centers for Disease Control and Prevention), international organizations (e.g., World Health Organization (WHO) or healthcare organizations.

2. Investment Scams – The U.S. Securities and Exchange Commission (SEC) urged investors to be wary of COVID-19-related investment scams, such as promotions that falsely claim that the products or services of publicly traded companies can prevent, detect, or cure coronavirus.

3. Product Scams – The U.S. Federal Trade Commission (FTC) and U.S. Food and Drug Administration (FDA) have issued public statements and warning letters to companies selling unapproved or misbranded products that make false health claims pertaining to COVID-19. Additionally, FinCEN has received reports regarding fraudulent marketing of COVID-19-related supplies, such as certain facemasks.

4. Insider Trading – FinCEN has received reports regarding suspected COVID-19-related insider trading.

If a COVID-19-affected credit union has concern about any potential delays in its ability to file required Bank Secrecy Act (BSA) reports. Financial institutions seeking to contact FinCEN should call FinCEN’s Regulatory Support Section (RSS) at 1-800-949-2732 and select option 6 or e-mail at FRC@fincen.gov. FinCEN’s RSS will continue to be available to support financial institutions for the duration of the COVID-19 pandemic.

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About Us

The League of Southeastern Credit Unions & Affiliates represents nearly 300 credit unions throughout Alabama, Florida, and Georgia. It has a combined total of almost $200 billion in assets and 12.4 million members. LSCU provides advocacy, compliance services, education and training, cooperative initiatives, and communications.

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