South Dakota cracks down on money laundering with stricter BSA/AML rules
South Dakota has tightened its financial regulations by enforcing stricter anti-money laundering rules. The state’s Division of Banking now requires licensed money lenders and non-residential mortgage brokers to comply with Bank Secrecy Act (BSA) and Anti-Money Laundering (AML) standards by March 31, 2024. This move aligns with a wider push for tougher oversight in financial transactions across the US.
The new rules stem from FinCEN’s 2020 Final Rule, which extended BSA/AML obligations to banks lacking a federal functional regulator. Over 550 institutions—including state-chartered trust companies, non-federally insured credit unions, and some international banks—now fall under these requirements. South Dakota’s decision mirrors this federal shift, ensuring non-depository lenders meet the same compliance standards as traditional us banks.
The March 31, 2024 deadline gives South Dakota’s lenders just months to align with the new BSA/AML rules. Compliance will become a key part of examinations later this year, with non-compliance risking financial penalties. Other states may follow suit, prompting lenders nationwide to reassess their own anti-money laundering safeguards.
