FinCEN Hits Pause: AML Rule for RIAs and ERAs Postponed

FinCEN Hits Pause: AML Rule for RIAs and ERAs Postponed

The Big News

The Financial Crimes Enforcement Network (FinCEN) has postponed the effective date of its Anti-Money Laundering and Counter-Terrorist Financing (AML/CFT) rule for SEC-registered investment advisers (RIAs) and Exempt Reporting Advisers (ERAs).Originally set to take effect on January 1, 2026, FinCEN announced in July 2025 that it would delay the rule and revisit its scope. The agency has now proposed a two-year extension—pushing the compliance date out to January 1, 2028.

Why the Delay?

FinCEN stated it wants more time to:- Reevaluate the rule’s scope in light of industry feedback,- Coordinate with the SEC on related requirements such as the proposed Customer Identification Program (CIP) rule, and- Ensure that implementation aligns with broader BSA/AML modernization efforts.The delay does not signal a retreat from regulating advisers under the Bank Secrecy Act. Instead, it reflects regulators’ desire to refine the rule and give firms time to prepare.

Who’s Still in Scope?

Once the rule becomes effective, the following firms will be covered:- SEC-registered RIAs- Exempt Reporting Advisers (ERAs)Not covered: state-registered advisers, family offices, and foreign private advisers.

What Will Be Required (Once Effective)

Even with the delay, the substance of the rule remains the same: covered advisers must implement risk-based AML/CFT programs that include—- Written policies, procedures, and controls- A designated AML Compliance Officer- Employee training- Independent testing of the program- Suspicious Activity Report (SAR) filing and compliance with the Travel Rule recordkeeping obligations

What Advisers Should Do Now

While 2028 feels far off, this delay is a window of opportunity, not a reason to stand still. Here’s what we recommend:1. Conduct a gap analysis comparing current onboarding/monitoring processes against FinCEN’s final rule.2. Designate an AML lead—this may be the CCO, but consider whether a dedicated officer makes sense for scale.3. Review vendor readiness, especially custodians, administrators, and KYC/AML service providers.4. Plan for staff training and testing, so you’re not scrambling once timelines are finalized.5. Monitor regulatory updates—the 2028 date is proposed, but political or enforcement pressures could accelerate the timeline.

Final Thoughts

The AML regime for advisers is not going away—it’s simply delayed. RIAs and ERAs should use this extra time to strategically prepare and document interim risk-based practices. Doing so will not only smooth the transition when the rule is finalized but also reassure clients, custodians, and examiners that your firm takes financial crime risk seriously.

Need Help?RIA Compliance Concepts offers tailored AML readiness assessments, policy drafting, and training for investment advisers. Contact us today to start building your firm’s roadmap to compliance.