The AML Compliance Clock Is Still Ticking: Why 2026 IT Budgets Matter Despite the FinCEN Delay
By Cindy Griffin, Financial Services Vertical Marketing Lead at Smart Communications
In 2024, U.S. regulators issued over $3 billion in fines related to anti-money laundering (AML) and know-your-customer (KYC) violations. Increasingly, enforcement actions are tied not just to bad actors, but to gaps in client onboarding, data quality, and communication breakdowns.
While this blog post focuses on a specific upcoming AML rule from the U.S. Treasury’s Financial Crimes Enforcement Network (FinCEN) targeting U.S.-based Registered Investment Advisors (RIAs), it's part of a broader global trend. Regulators around the world are sharpening their scrutiny of how financial institutions collect, verify, and manage customer data across the lifecycle.
Whether you're operating in the U.S., the UK, the EU, or APAC, the message is clear: AML compliance isn't just a policy issue—it's a technology and communications challenge.
A Delay Is Not a Free Pass on AML Compliance
On July 21, 2025, FinCEN announced a delay in the effective date of its proposed AML rule for RIAs, known as the IA AML Rule. Under the proposed rule, the definition of a “financial institution” under the Bank Secrecy Act would have been extended to include RIAs. This meant that RIAs would be required to implement an AML program, if they did not have one previously. Originally slated to take effect Jan. 1, 2026, the rule is now expected to go live on Jan. 1, 2028.
For many firms, this delay may feel like a reprieve. In reality, it’s a rare opportunity: a two-year runway to plan, budget, and execute strategic technology upgrades before compliance becomes urgent.
Enforcement Is Delayed—But AML Compliance Expectations Aren’t
While formal enforcement may be on hold, market expectations are already shifting. Investors and regulators are looking harder at how firms onboard clients, capture data, and identify suspicious activity. Many RIAs still rely on manual forms, static PDFs, and disconnected systems that leave them exposed to compliance gaps and audit risk.
AML accountability is coming. Firms that wait until 2027 to modernize forms and data collection to support AML processes will be in a late scramble, likely incurring higher costs and rushed implementations. You can wait until 2027 to panic, or use 2025 and 2026 to plan, evaluate vendors, and budget smartly.
Why AML Compliance Starts with Forms and Client Communication
AML doesn’t start in one transaction—it starts at onboarding. Optimizing this area requires a combination of technology, clear strategy, and streamlined processes working together. Dynamic forms automation and customer communications management (CCM) technologies enable firms to:
- Collect accurate, validated client data
- Trigger identity verification and sanctions screening
- Maintain digital audit trails
- Update forms and disclosures efficiently when regulations change
Trying to retrofit compliance workflows onto legacy platforms after the fact is expensive, time-consuming, and error prone.
Budget Planning for AML Compliance Starts in 2026
If you want to be live in 2027, you need funding in 2026. Many enterprise budget cycles require six to nine months of planning, stakeholder alignment, and approvals. Firms that start too late risk missing out or settling for temporary fixes. Start framing 2026 proposals around strategic compliance readiness, not just reactive rule-following.
With the FinCEN delay, firms have time to be methodical. You can phase in solutions, run pilots, and compare vendors based on both functionality and financial flexibility. Look for technology partners who can scale with you, offer modular deployments, and support long-term ROI.
Delay Offers Time to Build a Smarter AML Compliance Roadmap
The FinCEN delay gives firms valuable breathing room, but only if they use it to build a smarter, phased investment plan rather than kick the can down the road. Now is the time to map out a modernization roadmap that delivers immediate wins in onboarding, compliance workflows, and customer communications, while laying the groundwork to be ready for 2028.
As outlined in this blog post, early vendor research is key. By evaluating technology partners now—not in Q4 panic mode—you can compare flexible pricing models, assess implementation timelines, and position your project for approval in the 2026 budget cycle. It’s not just about being compliant later, it’s about making cost-effective progress now.
Start Your AML Compliance Budget Conversations Today
A two-year delay should be seen as strategic runway, not a reason to wait. Early action builds resilience, reduces risk, and strengthens your long-term regulatory posture.
Use the 2026 budget cycle to begin preparing your tech stack—especially CCM and forms automation—that will future-proof your AML readiness.
Reach out to our team to learn more about how we can assist you in reaching these goals.
Frequently Asked Questions: Planning for AML Compliance for RIAs
Q: Didn’t FinCEN delay the AML rule for RIAs? Why rush?
A: Yes, the rule was delayed to Jan. 1, 2028—but preparing now gives you time to budget thoughtfully, evaluate vendors, and modernize processes that support AML compliance before urgency sets in.
Q: What types of technology should we prioritize?
A: Start with forms automation and CCM tools that support accurate data collection, auditability, and workflow integration. These are foundational for AML compliance readiness and broader client lifecycle compliance.
Q: Can we wait until 2027 to upgrade?
A: You can, but it will be more expensive, rushed, and likely disruptive. Starting your process now lets you phase in changes strategically.
Q: Is this still relevant if we already use a CRM system?
A: Yes. While CRMs are valuable for managing relationships, they often lack the capabilities needed for structured data collection, dynamic form workflows, and compliance-grade audit trails. Critical AML inputs like CIP documentation, beneficial ownership details, and client attestations are often collected manually or stored in inconsistent formats. Integrating purpose-built forms and data automation tools with your CRM can close these gaps, ensuring cleaner data, faster onboarding, and stronger compliance posture.
Q: What’s the risk of doing nothing now?
A: You risk falling behind your peers, scrambling to fund upgrades later, and facing greater scrutiny from regulators and institutional partners alike.
Q: Is this just a U.S. issue, or should global firms be paying attention too?
A: While the FinCEN IA AML Rule specifically applies to U.S.-based RIAs, AML expectations are rising globally. Regulatory bodies globally are tightening rules around client due diligence, beneficial ownership, and digital recordkeeping. For global firms—or U.S. firms with international clients or operations—this is part of a worldwide shift toward more rigorous, data-driven AML enforcement. Investing in scalable, flexible tech now ensures you're ready for evolving compliance demands across all jurisdictions.