Treasury Postpones Effective Date of Investment Adviser AML Rule; Signals Broader Reassessment of Regulatory Framework

The U.S. Department of the Treasury’s Financial Crimes Enforcement Network (“FinCEN”) announced today its intent to postpone the effective date of its final rule imposing anti-money laundering (“AML”) and countering the financing of terrorism (“CFT”) requirements on investment advisers (the “IA AML Rule”). The new anticipated effective date is January 1, 2028, replacing the original date of January 1, 2026.

In parallel, FinCEN indicated that it plans to revisit the scope and substance of the IA AML Rule through a renewed rulemaking process. The agency cited the need to appropriately tailor regulatory obligations to the varied business models and risk profiles present across the investment adviser sector, while also balancing implementation costs and regulatory clarity.

Background on the IA AML Rule

As adopted, the IA AML Rule would subject both SEC-registered investment advisers and exempt reporting advisers to AML program requirements under the Bank Secrecy Act (“BSA”). Among other obligations, covered firms would be required to:

• Establish and maintain a written AML program;

• Design policies and procedures for detecting and reporting suspicious activity;

• Satisfy ongoing recordkeeping and information-sharing requirements.

FinCEN has emphasized the importance of bringing investment advisers within the scope of the U.S. AML regime due to the sector’s growing role in capital markets and its potential exposure to illicit finance risks. Nonetheless, the agency acknowledged today that further refinement of the rule is warranted to ensure the regime is effective, risk-based, and practicable.

Regulatory Certainty and Future Rulemaking

To reduce compliance uncertainty and mitigate premature implementation costs, FinCEN intends to issue formal exemptive relief delaying the effective date of the rule. Importantly, this relief is intended to provide the sector with regulatory clarity while the agency revisits key components of the rule and engages in broader reassessment.

As part of that review, FinCEN—together with the Securities and Exchange Commission (“SEC”)—will also revisit the proposed Customer Identification Program (“CIP”) requirements applicable to investment advisers. These dual initiatives reflect a coordinated effort to ensure that AML-related obligations across the adviser landscape are fit for purpose.

Observations and Implications

FinCEN’s decision reflects a growing recognition that a “one-size-fits-all” compliance model may be ill-suited to the diversity of the investment advisory space. Many firms operate without custody of client assets, serve distinct investor types, or maintain limited transactional exposure—all factors that warrant calibration in rule design.

While the delay provides short-term relief, firms should not interpret it as a retreat from regulatory expectations. Instead, it offers an opportunity to engage with the rulemaking process and to prepare for a future compliance environment that is likely to be more sophisticated and sector-specific.

Key Takeaways

• FinCEN plans to extend the effective date of the IA AML Rule to January 1, 2028, through forthcoming exemptive relief.

• A reopened rulemaking process will explore adjustments to the rule’s scope, obligations, and implementation structure.

• The proposed CIP rule for advisers will also be revisited as part of this broader reassessment.

• Firms are encouraged to monitor developments, review current compliance frameworks, and consider strategic engagement during the comment period.

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