Finance term
AMLA 2020 (Anti-Money Laundering Act of 2020)
Also known as: AMLA 2020, Anti-Money Laundering Act of 2020, AML Act 2020, NDAA AML, Corporate Transparency Act companion
Definition
The Anti-Money Laundering Act of 2020 (AMLA 2020), enacted as part of the National Defense Authorization Act (Pub. L. 116-283), is the most significant overhaul of U.S. anti-money-laundering law since the USA PATRIOT Act of 2001 — expanding FinCEN's authority, adding AML whistleblower protections, mandating beneficial ownership reporting, and directing Treasury to modernize the AML regulatory framework.
Detailed explanation
AMLA 2020 (Division F of the William M. (Mac) Thornberry National Defense Authorization Act for Fiscal Year 2021, Pub. L. 116-283) was signed into law on January 1, 2021 and represents the most comprehensive reform of U.S. AML law in two decades. The Act amends the Bank Secrecy Act (31 U.S.C. §§ 5311–5336) and introduced several landmark provisions:
**1. FinCEN Modernization and Priorities:** AMLA 2020 directed FinCEN to issue national AML/CFT (Counter-Financing of Terrorism) priorities and to modernize the BSA through a risk-based, innovation-friendly regulatory framework. FinCEN published its first-ever National AML/CFT Priorities in June 2021 (fincen.gov/news/news-releases/fincen-publishes-anti-money-launderingcountering-financing-terrorism).
**2. Corporate Transparency Act (CTA):** AMLA 2020 included the Corporate Transparency Act (31 U.S.C. § 5336), which requires most U.S. companies (LLCs, corporations, LLPs, etc.) to report beneficial ownership information to FinCEN. The CTA's Beneficial Ownership Information (BOI) reporting rule (31 CFR Part 1010, Subpart C) took effect January 1, 2024, with most existing companies required to file by January 1, 2025. Key resource: fincen.gov/boi.
**3. Whistleblower Protections:** AMLA 2020 created a new BSA whistleblower award program — informants providing original information leading to sanctions exceeding $1M are eligible for 10–30% of the collected sanction amount. This significantly strengthened AML enforcement incentives.
**4. Expanded SAR Safe Harbor and Penalties:** Enhanced protections for financial institutions filing SARs in good faith; increased penalties for BSA violations.
**5. Pilot Programs and Innovation:** FinCEN authorized to run innovation pilots (e.g., information sharing under Section 314(b)), supporting FinTech AML solutions.
For business borrowers, AMLA 2020's most direct impact is the CTA's beneficial ownership reporting — if your business is an LLC, corporation, or LP formed in the U.S. (with limited exceptions), you likely must file BOI with FinCEN at boifiling.fincen.gov. Failure to file carries civil penalties of $591/day and criminal penalties up to $10,000 and 2 years imprisonment. See fincen.gov/boi for filing requirements and exemptions.
◈ Worked example
- CTA BOI filing: A Delaware LLC formed in 2020 with two members must file a Beneficial Ownership Information (BOI) report with FinCEN by January 1, 2025 — reporting each beneficial owner's legal name, DOB, address, and ID number; filing at boifiling.fincen.gov (31 CFR § 1010.380)
- FinCEN Priorities impact: A bank's AML program must now address FinCEN's 8 national priorities (corruption, cybercrime, domestic terrorism, drug trafficking, fraud, human trafficking, proliferation financing, transnational crime) — published June 2021 at fincen.gov
- AMLA whistleblower: An employee at a financial institution reports systematic SAR suppression to FinCEN; if the resulting enforcement action yields $10M in penalties, the whistleblower is eligible for $1M–$3M (10–30% of collected sanctions) under AMLA 2020's new award program
Common questions
The most-asked questions about AMLA 2020 (Anti-Money Laundering Act of 2020) — answered straightforwardly.
Does AMLA 2020 require my business to file anything with FinCEN? +
Likely yes, if your business is an LLC, corporation, LLP, or similar entity formed in the U.S. The Corporate Transparency Act (part of AMLA 2020, 31 U.S.C. § 5336) requires most such entities to report beneficial ownership information to FinCEN. Existing companies formed before January 1, 2024 had until January 1, 2025 to file. New companies have 90 days from formation. Large operating companies (20+ employees, $5M+ revenue, physical office) and certain other categories are exempt. File at boifiling.fincen.gov and see fincen.gov/boi for full exemption details.
What are the penalties for not filing a BOI report under AMLA 2020? +
Civil penalties: $591 per day the violation continues (as of 2024; adjusted for inflation). Criminal penalties: up to $10,000 fine and 2 years imprisonment for willful violations. These penalties apply to both the entity and the individuals responsible for the failure to file. FinCEN's enforcement posture is to prioritize willful non-compliance over good-faith errors — but the filing deadline has passed for pre-2024 entities. File promptly if you haven't. See fincen.gov/boi for guidance.
How does AMLA 2020 affect small business financing? +
Three main effects: (1) Lenders subject to BSA now operate under FinCEN's national AML/CFT priorities, meaning enhanced scrutiny on businesses in higher-risk sectors (cannabis-adjacent, international, cash-intensive). (2) The CTA's beneficial ownership registry reduces the friction of BSA beneficial ownership verification at loan origination — lenders may soon be able to cross-reference FinCEN's registry directly. (3) Increased AML enforcement risk for lenders means more rigorous KYC/CDD at origination. Prepare by having your BOI filing current at boifiling.fincen.gov and your business documentation organized. See fincen.gov for current FinCEN guidance.
Further reading
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