Which types of companies are covered by the Bank Secrecy Act?

The Bank Secrecy Act (BSA) is a critical piece of legislation designed to combat money laundering and other financial crimes. It requires certain financial institutions to keep records and file reports that may be useful to detect and prevent money laundering and related activities. The types of entities specifically covered by the BSA include banks, credit unions, mortgage bankers, and mortgage brokers. These institutions are recognized as financial entities involved in handling significant amounts of cash and engaging in various financial transactions that could potentially facilitate illicit activities.

These financial institutions must follow regulations that require them to report suspicious activities, maintain adequate records of transactions, and put in place anti-money laundering (AML) programs. As such, the inclusion of banks, credit unions, mortgage bankers, and mortgage brokers under the BSA is instrumental in ensuring a robust oversight mechanism to safeguard the financial system against abuse.

On the other hand, while real estate agents, stock brokers, investment advisors, insurance companies, and credit counseling services may participate in financial transactions, they do not fall under the typical definitions of financial institutions as laid out by the BSA and, therefore, are not subject to the same regulatory requirements. This distinction is important for comprehending the landscape of financial regulations and the specific responsibilities imposed on different types