FDIC advances BSA, sanctions rule for bank-linked stablecoins

The Federal Deposit Insurance Corporation advanced a notice of proposed rulemaking on May 22 that would require Bank Secrecy Act, anti‑money laundering and counter‑terrorist financing (AML/CFT), and sanctions compliance for FDIC‑supervised permitted payment stablecoin issuers under the Guiding and Establishing National Innovation for U.S. Stablecoins Act (GENIUS Act). The proposal would amend 12 CFR Part 350 to add BSA and sanctions standards and create a new subpart for AML/CFT supervision and enforcement.

The rule would apply to permitted payment stablecoin issuers, or PPSIs, that are subsidiaries of insured state nonmember banks and state savings associations for which the FDIC is the primary federal regulator under the GENIUS Act. The proposal would require those issuers to maintain AML/CFT programs, economic sanctions controls and reporting procedures aligned with federal anti‑money laundering and sanctions frameworks.

The proposed enforcement framework would identify actions the agency could take in response to alleged AML/CFT deficiencies, weaknesses, violations of law or unsafe practices. These actions include cease‑and‑desist orders, written agreements, consent orders, memoranda of understanding, civil money penalties and significant supervisory measures.

The rule is intended to operate alongside requirements issued by the Treasury Department’s Financial Crimes Enforcement Network and the Office of Foreign Assets Control. Before taking certain enforcement or supervisory actions, the FDIC would give FinCEN’s director at least 30 days to review planned actions unless a faster response is necessary. The agency would share relevant AML/CFT materials with FinCEN, including draft examination findings, draft enforcement materials, workpapers and issuer submissions, while protecting privileged information.

Comments on the proposed rule will be accepted for 60 days after the notice is published in the Federal Register. The FDIC described the proposal as part of its 2026 work to implement the GENIUS Act’s payment stablecoin framework. In April the agency advanced a separate proposal covering reserves, redemption, capital, risk management, custody and the treatment of deposits tied to stablecoin activities.

The FDIC estimated that between five and 30 FDIC‑supervised institutions could seek approval to issue payment stablecoins through subsidiaries in the first few years after the GENIUS Act takes effect. The agency wrote that the proposal is expected to enhance the effectiveness, consistency and supervisory clarity of BSA and sanctions compliance.