As the regulatory landscape is constantly evolving, Compliance Risk Concepts (“CRC”) is issuing its monthly review and summary of various FINRA, SEC, NFA, and FinCEN publications to assist our clients in keeping abreast of notable regulatory developments and deadlines in an effort to strengthen their compliance and regulatory initiatives.
FINRA
Regulatory Notices
Per Regulatory Notice 25-07, FINRA has previously made significant changes to its rules, guidance and processes to support the evolution of the member workplace consistent with our mission of investor protection and market integrity. As part of the broad rule modernization review, this Notice seeks comment on how FINRA can further evolve its rules, guidance and processes to reflect modern business practices and markets; support innovation and new technologies; promote efficiency; and eliminate unnecessary regulatory burdens—all in the interest of supporting vibrant capital markets in which everyone can participate with confidence.
Original Comment Period Expires: June 13, 2025
In response to feedback, FINRA has extended the comment period to July 14, 2025.
SEC
Final Rules
Per Release No. IC-35538, the SEC is adopting amendments to reporting requirements on Forms N-PORT and N-CEN that apply to certain registered investment companies, including registered open-end funds, registered closed-end funds, and unit investment trusts. The amendments will require more frequent reporting of monthly portfolio holdings and related information to the SEC and the public, amend certain reporting requirements relating to entity identifiers, and require open-end funds to report information about service providers used to comply with liquidity risk management program requirements. In addition, the SEC is providing guidance related to open-end fund liquidity risk management program requirements.
The SEC is extending the effective date for the amendments to Form N-PORT that were adopted on August 28, 2024, from November 17, 2025, to November 17, 2027. The SEC is also extending the effective date of the amendments to the rule under the Investment Company Act of 1940 (“Investment Company Act”) associated with Form N-PORT reporting requirements. In addition, the SEC is extending the compliance dates for these amendments related to Form N-PORT reporting requirements. The effective and compliance date for the amendments to Form N-CEN contained in the same release adopted on August 28, 2024, will remain November 17, 2025.
Proposed Rules
There were no proposed rules in April.
Interim Final Rules
There were no interim final rules in April.
Interpretive Releases
There were no interpretive releases in April.
There were no policy statements in April.
NFA
Notices to Members
Notice I – 25 – 10
April 15, 2025
Effective date for NFA rule establishing requirements regarding pre-dispute arbitration agreements and amendments to NFA’s Code of Arbitration
NFA recently adopted NFA Compliance Rule 2-53 , which requires NFA Members and Associates to ensure that any pre-dispute arbitration agreement (PDA) they enter into or rely upon with non-eligible contract participant (ECP) customers complies with CFTC Regulation 166.5. The Rule ensures NFA Members and Associates fully understand their obligations under CFTC Regulation 166.5. NFA Compliance Rule 2-53 is effective as of today, April 15, 2025.
Additionally, NFA amended Section 1 of the Code of Arbitration (Code) to give NFA jurisdiction over arbitration claims filed by non-ECP customers involving a fully collateralized cleared swaps transaction—commonly known as an event contract—against an NFA Member, Associate or an employee of an NFA Member. The amendments are effective for all arbitration claims filed on or after today, April 15, 2025.
NFA’s March 27, 2025, rule submission letter to the CFTC contains more details regarding NFA Compliance Rule 2-53 and amendments to NFA’s Code, which were unanimously approved by NFA’s Board of Directors.
Notice I – 25 – 11
April 21, 2025
Request for public representative nominations for NFA’s board of directors
Please Route To:
Compliance/Legal Sr. Management
At NFA’s Board of Directors’ (Board) regular Annual Meeting on February 19, 2026, the terms of four of NFA’s current Public Representatives – Ana Beskin, Ronald H. Filler, Arthur W. Hahn and Mary M. McDonnell – will expire. NFA’s Articles of Incorporation require NFA to seek nominations of individuals to be considered to serve on the Board in the Public Representative Category, which may be made by both NFA Members and non-Members. The four Public Representatives whose terms are expiring are eligible for nomination.
In considering individuals to nominate as a Public Representative, please keep in mind that NFA’s Board has consistently included Public Representatives with outstanding credentials, and their contributions to NFA have been enormous. Public Representatives bring the perspective of non-Members to the Board. Public Representative candidates should be knowledgeable of the markets and the Members regulated by NFA and have no material relationship with NFA that would impact their ability to provide an impartial, objective analysis of the issues that come before the Board. NFA Bylaw 517 sets forth the qualifications for Public Representatives as follows:
To qualify as a Public Representative of NFA, an individual must first be found by the Board, on the record, to have no material relationship with NFA that might reasonably affect the independent judgment or decision-making of the public representative. Any of the following relationships during the previous three years shall be considered a material relationship with NFA:
(a) The Director or member of the Director’s immediate family (i.e., spouse, parents, children and siblings) is an NFA Officer or employee;
(b) The Director is an NFA Member, Associate Member or a principal of an NFA Member or has an immediate family member (i.e., spouse, parents, children and siblings) who is an NFA Member, Associate Member or principal of an NFA Member;
(c) The Director, or a member of the Director’s immediate family, or a firm with which the Director or a member of the Director’s immediate family, is an officer, director or partner receives more than $100,000 in combined annual payments from NFA for legal, accounting or consulting services. Compensation for services as a Director of NFA does not count towards the annual $100,000 payment limit, nor does deferred compensation for services prior to becoming a Director so long as compensation is in no way contingent, conditioned or revocable; and
(d) The Director, or a firm with which the Director is an officer, director or partner receives more than $100,000 annually from an NFA Member or Associate Member for legal, accounting or consulting services related to the NFA Member’s or Associate Member’s CFTC registered activities.
Nominations must be submitted by email to election2026@nfa.futures.org by June 9, 2025. Upon receipt of any nominations(s), NFA staff will provide the Public Representative Application to any non-incumbent nominee(s) who express an interest in serving. A nominee(s) will have until June 16, 2025, to complete and submit this Application. As it reviews the completed Application(s) and evaluates nominee(s), NFA’s Nominating and Governance Committee may also request interviews with interested nominees prior to September 2025.
NFA News Releases
There were no news releases in April.
FinCEN
FinCEN News Releases
FinCEN Issues Advisory on the Financing of ISIS
April 01, 2025
WASHINGTON — Today, the U.S. Department of the Treasury’s (Treasury) Financial Crimes Enforcement Network (FinCEN) issued an Advisory to assist financial institutions in identifying and reporting suspicious activity related to the financing of the Islamic State of Iraq and Syria (ISIS). The Advisory highlights how ISIS and its global affiliates fund themselves and receive financial support from sympathizers internationally and describes several typologies ISIS uses to transfer money between its affiliates. The Advisory also provides red flags that may assist financial institutions in identifying related suspicious activity.
“The threat from ISIS has evolved and changed over time, but its malicious intentions against the United States, its interests, and its allies have remained consistent,” said FinCEN Director Andrea Gacki. “As the terrorist organization looks for ways to take advantage of instability in Syria and elsewhere to grow and resurge, we look to financial institutions to remain vigilant in identifying ISIS funding streams and protecting the U.S. financial system from terrorist financing.”
ISIS is a Sunni terrorist organization that has conducted and inspired terrorist attacks worldwide for more than a decade, killing or injuring thousands of people. Last year’s mass casualty attacks in Iran and Moscow by ISIS’s branch in Central Asia, known as ISIS-Khorasan (ISIS-K), as well as the 2025 New Year’s Day attack in New Orleans, carried out by an ISIS-inspired homegrown violent extremist (HVE), demonstrate that the ISIS threat and influence remains far-reaching and that vigilance is required at home and abroad.
This Advisory is a continuation of the sustained effort that Treasury has led for more than a decade, in coordination with the U.S. government interagency and foreign partners, to disrupt and eliminate ISIS’s revenue sources and financial networks. This Advisory is also consistent with the National Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) Priorities, which include terrorist financing, as well as Treasury’s 2024 National Terrorist Financing Risk Assessment.
Questions regarding the contents of this advisory should be sent to the FinCEN Regulatory Support Section by submitting an inquiry at www.fincen.gov/contact.
The full alert is available online at FIN-2025-A001.
FinCEN Issues Analysis of Fentanyl-Related Threat Patterns and Trends in Bank Secrecy Act Reports
April 09, 2025
WASHINGTON—Today, the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) issued a Financial Trend Analysis focused on patterns and trends identified in Bank Secrecy Act (BSA) data linked to fentanyl-related illicit finance. Between January and December 2024, financial institutions filed 1,246 BSA reports that identified suspected fentanyl-related activity amounting to approximately $1.4 billion in suspicious transactions. The reported financial activity highlighted various aspects of the illicit fentanyl supply chain—including precursor chemical procurement, fentanyl trafficking, and fentanyl-linked money laundering—that have touchpoints across the U.S. financial sector.
“As Treasury continues to prioritize combating the illegal production and trafficking of fentanyl, our public-private partnerships are vital,” said Secretary of the Treasury, Scott Bessent. “As today’s analysis shows, the information we receive from financial institutions is a critical element in our ability to more effectively investigate and disrupt the malicious actors that profit off this unprecedented epidemic, and ultimately aids in the effort to save American lives.”
Illicit fentanyl is primarily synthesized, trafficked, and smuggled into the United States by Mexican cartels. The Sinaloa Cartel and the Cartel Jalisco Nueva Generacion—which are Foreign Terrorist Organizations, Specially Designated Global Terrorists, and Drug Trafficking Organizations—largely control the fentanyl supply chain from Mexico and use precursor chemicals and manufacturing equipment primarily sourced from the People’s Republic of China (PRC) to synthesize illicit fentanyl in clandestine laboratories. FinCEN analysis identified Mexico and the PRC as the top two foreign countries listed in subject address fields of fentanyl-related BSA reports filed in 2024.
Additional findings of FinCEN’s analysis include:
- The cartels and associated chemical brokers use front companies, money mules, and U.S.-based intermediaries to procure fentanyl precursor chemicals from PRC-based suppliers.
- PRC-based chemical suppliers accept a wide range of payment methods and often leverage public advertisements, including e-commerce platforms, to market fentanyl precursor chemicals.
- Fentanyl-related financial activity in the United States primarily involved subjects in populous states with large urban areas that have established drug distribution networks and serve as collection points for illicit proceeds, including a substantial number of subjects in southwest border counties in California and Arizona.
- Domestic sales of fentanyl appeared to be conducted primarily in cash and peer-to-peer transfers, which were referenced in 54 and 51 percent of BSA reports, respectively.
- Methods to launder suspected fentanyl proceeds varied in sophistication. BSA filers identified complex schemes, including the use of suspected Chinese money laundering organizations potentially facilitating the movement of illicit fentanyl proceeds on behalf of the cartels.
Combating drug cartels and stopping the flow of deadly drugs into the United States is one of the Administration’s highest priorities. As such, FinCEN continues to encourage financial institutions to carefully review its August 2019 and June 2024 advisories on the trafficking of fentanyl, fentanyl analogues, and other synthetic opioids and the precursor chemicals and associated manufacturing equipment needed to synthesize these deadly drugs.
FinCEN Renews Residential Real Estate Geographic Targeting Orders
April 14, 2025
WASHINGTON—Today, the Financial Crimes Enforcement Network (FinCEN) announced the renewal of its Geographic Targeting Orders (GTOs) that require U.S. title insurance companies to identify the natural persons behind shell companies used in non-financed purchases of residential real estate.
The terms of the GTOs are effective beginning April 15, 2025, and ending on October 9, 2025. The GTOs continue to provide valuable data on the purchase of residential real estate by persons possibly involved in various illicit enterprises. Renewing the GTOs will further assist in tracking illicit funds and other criminal or illicit activity.
FinCEN renewed the GTOs that cover certain counties and major U.S. metropolitan areas in California, Colorado, Connecticut, Florida, Hawaii, Illinois, Maryland, Massachusetts, Nevada, New York, Texas, Washington, Virginia, and the District of Columbia. No changes have been made to jurisdictional coverage since the last issuance of these GTOs. The purchase price threshold likewise remains $300,000 for each covered metropolitan area, with the exception of the City and County of Baltimore, where the purchase price threshold is $50,000.
FinCEN appreciates the continued assistance and cooperation of title insurance companies and the American Land Title Association in protecting the real estate market from abuse by illicit actors.
Any questions about the Orders should be directed to www.fincen.gov/contact.
A copy of the Order is available here.
Frequently asked questions regarding these GTOs are available here.
Hot Issue
The financial services industry is currently navigating significant regulatory shifts, with a pronounced focus on the evolving landscape of digital assets and cryptocurrencies. Paul Atkins reaffirmed this in his first SEC townhall meeting as the new SEC Chairman, where he referenced having a long list of priorities, but he specifically mentioned “a sensible approach toward crypto” and the “regulatory treatment of digital assets and distributed ledger technologies” as examples in his remarks. Therefore, we expect digital asset guidance to be forthcoming, and we recommend that compliance officers keep a close eye on developments in this space as well as any shifts in enforcement priorities stemming from administration policy changes, all of which remain fluid and politically charged.
Our Perspective
We believe that staying informed is critical to a proactive regulatory compliance program, but we appreciate the challenge of balancing this commitment with day-to-day business execution, particularly in a period of heightened regulatory flux and quickly shifting political priorities. CRC staff can serve as overflow executives, acting as an extension of your in-house team to review and ensure compliance is working properly, manage spikes in workload or address under-served areas of the business.
For more information, please contact:
Mitch Avnet
p. (646) 346-2468
David Amster
p. (917) 568-6470
Sources:
- FINRA Notices
- SEC Notices
- NFA Notices
- FinCEN News Releases
