While Trump is concerned about burdensome regulations, he also is concerned about fighting terrorism and other crimes such as drug trafficking. His objective, as is the case with any administration, is to disrupt the financial flow to terrorism groups and other criminals.
All In on the Fight Against Terrorism
Businesses, too, have a vested interest in doing so in order to protect their interests as well as those of their customers. In order to do this effectively, companies must actively vet the business partners they have, as well as the business transactions they have with those partners. Having strong and reliable business data helps companies achieve this goal.
Of course, while Trump may want to ease regulatory burdens on businesses, to the extent he cannot do so unilaterally through executive order or other authorization to do so, he will have to work with the Republican Congress, subject to any legal challenges.
Industrialized countries have signed onto global anti-money laundering (AML) and anti-bribery/anti-corruption (ABAC) conventions. Negotiations on trade deals with other nations would likely bring pressure on the United States to continue to have and enforce AML and ABAC laws and to honor the conventions. Therefore, we might expect movement in the following areas:
As previously noted, Trump undoubtedly recognizes that an effective weapon in our arsenal to fight terrorism is to cut off the flow of money financing terrorist groups. Therefore, AML/know your customer (KYC) regulations will remain critical in this effort. The Financial Crimes Enforcement Network (FinCEN) Final Rule supports anti-terrorism financing efforts and will likely remain in effect. The government and responsible financial institutions and companies want to identify and vet their business partners in this effort.
Trump has run global businesses and has experience dealing with third-party intermediaries, foreign government officials and global ABAC laws. Although he has criticized the FCPA, he would not want to permit the bribery of corrupt foreign officials stealing from their citizenry. He may, however, support the continuation of a facilitation payment exclusion in the FCPA if he thinks it helps American businesses compete globally.
Trump has spoken out against drug trafficking and other crimes, as well as terrorism, so we could expect him to support third-party due diligence requirements in KYC, the US Patriot Act, the FCPA, and FinCEN Final Rule. These requirements are in the public interest because they require financial institutions and businesses to vet third-parties before engaging in financial transactions with them, and to monitor those relationships.
Therefore, we should expect that leveraging global data to identify and verify entities and their beneficial owners should continue to be a critical part of onboarding business partners. Further, utilizing compliance systems that screen those parties and monitor them for any changes will continue to be important.
We can expect that the Trump administration will review the status of sanctions globally, and determine which ones to keep and which ones to be potentially relaxed.
DOJ Compliance Expert
Hui Chen was appointed by DOJ to be a compliance expert advising prosecutors on the assessment of compliance programs. Under the forthcoming Trump Administration, Chen, or someone else in that position, might be called upon to provide deeper insight into what compliance measures are reasonable for corporations and what, if any, measures are unnecessarily impeding business.