FinCEN, OFAC propose AML rules under GENIUS

The U.S. Treasury’s Financial Crimes Enforcement Network and Office of Foreign Assets Control on April 8 issued a joint proposed rule for payment stablecoin issuers under the GENIUS Act. The proposal would treat permitted payment stablecoin issuers, or PPSIs, as financial institutions for Bank Secrecy Act purposes and require them to maintain sanctions compliance programs. Treasury said the rule is meant to implement the law’s anti-money laundering and sanctions provisions while tailoring requirements to the size and complexity of issuers. The comment deadline is June 9, 2026. ### What would the rule actually require stablecoin issuers to do? FinCEN’s fact sheet says permitted issuers would have to establish and maintain anti-money laundering and countering the financing of terrorism programs, report suspicious activity, and comply with customer identification and due-diligence obligations that apply to financial institutions. The proposal also would require issuers to maintain effective sanctions compliance programs. (fincen.gov) The same fact sheet says issuers would need technical capabilities, policies and procedures to block, freeze and reject specific or impermissible transactions that violate federal or state law, and to comply with lawful orders. Treasury described the regime as “fit for purpose” and said it was designed to assist law enforcement while limiting unnecessary burden. (fincen.gov) ### Who counts as a “permitted payment stablecoin issuer”? The GENIUS Act, enacted on July 18, 2025, created the federal framework for payment stablecoins and directed Treasury to write implementing rules. Under the proposal, the covered entities are “permitted payment stablecoin issuers,” the category the law uses for issuers allowed to operate under the statute’s licensing and supervisory structure. (fincen.gov) The Federal Register notice says the law directs Treasury to treat those issuers as financial institutions for Bank Secrecy Act purposes. That matters because it brings stablecoin issuers into the same basic anti-money laundering architecture used for other regulated financial firms, with FinCEN handling AML rules and OFAC handling sanctions-related requirements under delegated Treasury authority. ### Why are FinCEN and OFAC issuing this together? (ofac.treasury.gov) The April 10 Federal Register notice says Treasury delegated authority under the GENIUS Act to the director of FinCEN for anti-money laundering and counter-terrorist financing regulations and to the director of OFAC for economic sanctions regulations. The agencies therefore issued a joint proposal rather than separate rules. Treasury’s release said the rule is intended to encourage innovation in payment stablecoins while mitigating illicit-finance risks. (ofac.treasury.gov) FinCEN’s release used similar language, saying the proposal would subject issuers to requirements applicable to financial institutions relating to the prevention of money laundering and impose obligations specified in the GENIUS Act. ### How does this fit into the broader GENIUS rollout? Treasury on April 1 separately proposed principles for deciding when a state-level regulatory regime is “substantially similar” to the federal framework under the GENIUS Act. Treasury said that proposal was the first regulation it had proposed to implement the law and noted that issuers with no more than $10 billion in consolidated outstanding issuance may opt for state-level regulation if the state regime qualifies. (fincen.gov) Treasury had also issued an advance notice of proposed rulemaking in September 2025 seeking comment on a wider set of implementation questions. The April 8 joint proposal on AML and sanctions is one of the more operational pieces of that rollout because it sets out the compliance controls issuers would need to maintain. ### What happens next? Comments on the FinCEN-OFAC proposal must be received by June 9, 2026, according to the Federal Register notice. (home.treasury.gov) Treasury said comments should be submitted through Regulations.gov under docket FINCEN-2026-0100. Treasury is also taking comments on its separate state-regime proposal, which was published for notice and comment on April 1. The next step for both tracks is Treasury review of public comments before any final rules are issued. (home.treasury.gov 1) (home.treasury.gov 2) (ofac.treasury.gov)