MIAMI (Thomson Reuters Regulatory Intelligence) - The administration of U.S. President Donald Trump is unlikely to ease U.S. anti-money laundering regulations, former New York Mayor Rudy Giuliani said Wednesday in an interview with Thomson Reuters Regulatory Intelligence.
The administration is also likely to issue cyber security regulations, but they would probably be “fairly loose” in their impact on businesses, Giuliani said at a compliance conference in Florida.
“I would think one area where you’re not going to see too much of a rollback, if any, is in the area of terrorism,” Giuliani, who played a role in Trump’s transition team and was appointed by the president as public-private liaison on cyber security issues, said on the sidelines of the conference. “(The president) realizes that part of defeating terrorism is following the money. One of the ways you defeat them is to take the money away from them and one of the ways you find them is through the money.”
“That area may be one of the few exceptions,” Giuliani said.
Giuliani, a former federal prosecutor who served as mayor during the 9/11 attacks on New York, said the financial crime intelligence that banks have provided has been “very helpful” in combating terrorism.
“That area of the law may be working very well,” he said.
Trump last month signed an executive order to place “regulatory reform” task forces and officers within federal agencies in what may be the most far reaching effort to pare back U.S. red tape in recent decades. He previously vowed a sweeping cut in U.S. regulations and ordered agencies to repeal two rules for every new one adopted.
Trump has taken particular aim at the 2010 Dodd-Frank Wall Street reform law, calling it a disaster and vowing changes. It appears, however, that the primary U.S. anti-money laundering law, the Bank Secrecy Act, is not targeted.
Trump is leading an “aggressively anti-regulatory administration,” Giuliani told the audience at the Florida International Bankers Association (FIBA) anti-money laundering conference.
He added, however, that some “fairly loose” regulations may be issued on cyber security, spelling out what companies should do to avoid breaches and possibly providing a “safe harbor” for those that follow the rules in “good faith.”
“There will be a federal standard coming,” he said.
Firms would be wise to hire companies to evaluate their vulnerabilities as well as companies to guard against “breaches” and yet others to test defenses by trying to break through them, Giuliani said. Giuliani has provided commercial consulting services on cyber security legal matters.
In response to a question from FIBA president David Schwartz, Giuliani estimated that cyber security defense measures for banks could run from hundreds of thousands of dollars for smaller institutions to “multiple millions of dollars” for the largest institutions.
“It does cost a lot of money, no doubt about it,” he said.
It is important that companies be prepared to show they took “reasonable care” to avoid breaches because those whose weaknesses allow hackers to make off with people’s identities can face lawsuits and end up losing much more than they would have spent to properly defend themselves, Giuliani said.