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US AML Compliance: What’s Coming in 2026 is Now Delayed Until 2028

Posted on Jul 30, 2025

On August 28, 2024, the Financial Crimes Enforcement Network (FinCEN) finalized a long-anticipated rule expanding U.S. Anti-Money Laundering (AML) obligations to cover investment advisers. Originally set to take effect on January 1, 2026, FinCEN announced its intention to delay the compliance date to January 1, 2028, pending a broader review and rulemaking process.

During the delay, FinCEN plans to review the content of the Investment Adviser AML Rule through a future rulemaking process. In coordination with the SEC, it also intends to revisit the previously proposed joint rule on customer identification requirements for investment advisers, titled Customer Identification Programs for Registered Investment Advisers and Exempt Reporting Advisers.

 

Who is Covered?

The final rule adds “investment advisor” to the definition of “financial institution” under the Bank Secrecy Act (BSA), and, with certain exclusions noted below, defines investment advisers as:

  • investment advisers registered with or required to register with the SEC, also known as registered investment advisers (RIAs), and
  • investment advisers that report information to the SEC as exempt reporting advisers (ERAs).

The following are generally exempt from these new requirements:

  • family offices
  • State-registered advisers
  • RIAs that register with the SEC solely because they are:
    • mid-sized advisers
    • multi-state advisers
    • pension consultants
  • RIAs that are not required to report any AUM to the SEC on Form ADV.

For Canadian and non-U.S. advisors, the final rule applies to activities that:

  • take place within the United States
  • provide advisory services to a U.S. person or a foreign-located private fund with an investor that is a U.S. person.

 

What the New AML Rule Requires

Covered advisers must implement a formal, risk-based AML program, including:

  • Written AML/CFT policies and procedures
  • Conducting customer due diligence
  • Performing ongoing due diligence and transaction monitoring
  • Reporting suspicious activity through Suspicious Activity Reports (SARs)
  • Appointment of an AML compliance officer
  • Staff AML training
  • Independent testing of the AML program

 

Revised Timeline and Next Steps

Although FinCEN is reviewing the final rule and amendments may follow, advisers should use the delay to begin preparing given the scope of work required. Early planning allows time to build effective frameworks, address resource gaps, and avoid rushed implementation once the rule takes effect.

 

Key Steps to Take Now:

  • Gap Analysis: Review current AML policies and identify where updates are needed.
  • Draft Risk-Based AML Program: Define onboarding controls, investor risk tiers, roles, escalation procedures, and oversight mechanisms.
  • Leverage Technology: Use automated systems to manage KYC, identity verification, and sanctions screening.
  • Train Staff: Provide role specific AML training across teams.
  • Appoint an AML Officer: Designate a qualified lead to manage and enforce your AML program.
  • Implement Monitoring and SAR Protocols: Ensure regular review of transactions and document any suspicious activity.
  • Schedule Independent Testing: Arrange for annual testing of your AML program by a qualified professional.

 

How Pinnacle Fund Services Can Help

Pinnacle provides robust, scalable, and fully integrated KYC/AML solutions designed for investment managers, private funds, and all types of investment vehicles.

Core Services:

  • Investor Identity Verification: Including individuals, businesses, and beneficial owners with structured review of legal documents and corporate structures.
  • Background Checks: Screening for PEPs, financial crime links, and sanctions using up-to-date global data sources.
  • Investor Risk Rating: Customizable, risk-based frameworks that assess investor profiles during onboarding and through ongoing monitoring.
  • Ongoing Due Diligence & Monitoring: Continuous reviews aligned with investor risk profiles, including automated daily screening for changes in sanctions, PEP status, or adverse media.
  • Enhanced Due Diligence: Applied based on risk, including deeper reviews for high-risk investors and Politically Exposed Persons (PEPs).
  • “Four Eyes” Review & Approval Process: Multi-layered verification protocols ensure robust compliance and minimized risk.
  • Advanced Identity Security Features: Incorporate advanced biometric authentication and ID anti-tampering technology through a trusted third-party partner, ensuring the highest level of identity, integrity and fraud prevention.

 

Conclusion

The rule aims to address ongoing illicit finance risks and threats posed by criminals and foreign adversaries exploiting the U.S. financial system through investment advisers. While FinCEN may revise the rule, the core AML obligations for investment advisors are expected to remain. The delayed timeline offers a valuable opportunity to prepare without pressure.

At Pinnacle Fund Services, we provide knowledge, tools, and support to help you get there, efficiently, confidently, and on time.  Please reach out to Joanne Remillard at [email protected] or 1-604-559-8920 for more information about our AML / KYC services.