Question 1

How often does a broker-dealer need an independent AML test?

Accepted Answer

Under FINRA Rule 3310(c), a broker-dealer must perform independent testing of its AML program on an annual basis. Firms that do not execute transactions with customers or otherwise hold customer accounts, and that do not act as introducing brokers, may qualify to test every two years. The testing must be performed by a qualified person who is not the AMLCO and who does not report to the AMLCO.

Question 2

Can the AML independent test be performed in-house?

Accepted Answer

Yes, if the firm has personnel who are independent of the AML function, possess sufficient subject-matter expertise, and do not report to the AMLCO. Most small and mid-size broker-dealers find it more efficient, and more defensible during a FINRA exam, to engage an outside specialist.

Question 3

What are the core elements of a written AML program?

Accepted Answer

Under FINRA Rule 3310, a written AML program must include: (1) policies, procedures, and internal controls reasonably designed to achieve compliance with the BSA; (2) independent testing; (3) a designated AML compliance officer; (4) ongoing employee training; and (5) appropriate risk-based procedures for conducting ongoing customer due diligence, including beneficial ownership identification and ongoing monitoring.

Question 4

When does the FinCEN Investment Adviser AML Rule take effect?

Accepted Answer

On December 31, 2025, FinCEN issued a final rule extending the effective date of the Investment Adviser AML Rule from January 1, 2026 to January 1, 2028. FinCEN has also indicated it may further tailor the rule's scope before that date.

Question 5

Do municipal advisors have to maintain an AML program?

Accepted Answer

Standalone municipal advisors are not directly subject to FINRA Rule 3310. However, municipal advisors that are dually registered as broker-dealers, that handle client funds, or that operate within bank holding companies typically have AML obligations through those other registrations or affiliated entities.

Question 6

What does an outsourced AMLCO arrangement look like?

Accepted Answer

ARS personnel can serve as the named or de facto AMLCO under a written engagement, run day-to-day AML operations, file SARs and CTRs, conduct training, and interface with regulators. The firm retains ultimate responsibility, documented to satisfy FINRA expectations on outsourced supervisory functions.

Question 7

How long does it take to build an AML program from scratch?

Accepted Answer

For a new broker-dealer going through the FINRA New Member Application process, ARS typically delivers a complete AML program (written program, risk assessment, training plan, and testing schedule) in four to eight weeks, calibrated to the firm's planned business activities.

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