State regulators supervise the largest number of financial institutions, both banks and nonbanks, subject to Bank Secrecy Act and anti-money laundering (“BSA/AML”) requirements. Although maintaining the financial system’s integrity is paramount, compliance resources must also be well-targeted and deployed according to risk. The current BSA/AML framework does not meet this standard. BSA/AML requirements remain one of the most challenging and expensive compliance areas for financial institutions. In the 2025 CSBS Annual Survey of Community Banks, bankers say BSA/AML represents 25% of their total compliance burden. Industry estimates suggest that U.S. financial institutions spent $59 billion on BSA/AML compliance in 2023, and state supervisors conducted more than 1,000 BSA compliance exams in the same year. And yet, less than 6% of Suspicious Activity and Currency Transaction Reports are utilized by law enforcement.