financial crimes enforcement network


  • She stated that FinCEN collaborates with the Federal Financial Institutions Examination Council, a congressionally-chartered forum called the “Bank Secrecy Act (BSA) Advisory
    Group” and BSA Working Group to review and discuss new regulations and guidance, with the FBI-led “Virtual Currency Emerging Threats Working Group” (VCET) formed in early 2012, the FDIC-led “Cyber Fraud Working Group”, the Terrorist Financing
    & Financial Crimes-led “Treasury Cyber Working Group”, and with a community of other financial intelligence units.

  • [9] Hawala As early as 2003 FinCEN disseminated information on “informal value transfer systems” (IVTS), including hawala, a network of people receiving money for the purpose
    of making the funds payable to a third party in another geographic location,… generally tak[ing] place outside of the conventional banking system through non-bank financial institutions or other business entities whose primary business activity
    may not be the transmission of money.

  • FinCEN’s regulations under Section 314(a) enable federal law enforcement agencies, through FinCEN, to reach out to more than 45,000 points of contact at more than 27,000 financial
    institutions to locate accounts and transactions of persons that may be involved in terrorist financing and/or money laundering.

  • “[3] It is a network bringing people and information together, by coordinating information sharing with law enforcement agencies, regulators and other partners in the financial

  • Formed: April 25, 1990; Headquarters: Vienna, Virginia; Annual budget: $114.222 million (2018)[1] ; Agency executive: Director, Ken Blanco; Parent agency: Office of Terrorism
    and Financial Intelligence Mission FinCEN’s director expressed its mission in November 2013 as “to safeguard the financial system from illicit use, combat money laundering and promote national security.

  • [12] On March 18, 2013 FinCEN issued a guidance regarding virtual currencies,[13] according to which, exchangers and administrators, but not users of convertible virtual currency
    are considered money transmitters, and must comply with rules to prevent money laundering/terrorist financing (“AML/CFT”) and other forms of financial crime, by record-keeping, reporting and registering with FinCEN.

  • The Financial Crimes Enforcement Network (FinCEN) is a bureau of the United States Department of the Treasury that collects and analyzes information about financial transactions
    in order to combat domestic and international money laundering, terrorist financing, and other financial crimes.

  • Since September 2012 FinCEN generates 4 new reports: Suspicious Activity Report (FinCEN SAR), Currency Transaction Report (FinCEN CTR), the Designation of Exempt Person (DOEP)
    and Registered Money Service Business (RMSB).

  • “[14] At a November 2013 Senate hearing, Calvery stated, “It is in the best interest of virtual currency providers to comply with these regulations for a number of reasons.

  • [6] FinCEN shares information with dozens of intelligence agencies, including the Bureau of Alcohol, Tobacco, and Firearms; the Drug Enforcement Administration; the Federal
    Bureau of Investigation; the U.S. Secret Service; the Internal Revenue Service; the Customs Service; and the U.S.

  • [2] According to the Department of Justice, VCET members represent the FBI, the Drug Enforcement Administration, multiple U.S. Attorney’s Offices, and the Criminal Division’s
    Asset Forfeiture and Money Laundering Section and Computer Crime and Intellectual Property Section.

  • [6] Organization As of November 2013, FinCEN employed approximately 340 people, mostly intelligence professionals with expertise in the financial industry, illicit finance,
    financial intelligence, the AML/CFT (money laundering/terrorist financing) regulatory regime, computer technology, and enforcement”.

  • FinCEN and money laundering laws have been criticized for being expensive and relatively ineffective, while violating Fourth Amendment rights, as an investigator may use FinCEN’s
    database to investigate people instead of crimes.

  • [15] Controversies In 2009, the GAO found “opportunities” to improve “interagency and state examination coordination”, noting that the federal banking regulators issued an
    interagency examination manual, that SEC, CFTC, and their respective self-regulatory organizations developed Bank Secrecy Act (BSA) examination modules, and that FinCEN and IRS examining nonbank financial institutions issued an examination
    manual for money services businesses.

  • In May 1994, its mission was broadened to include regulatory responsibilities, and in October 1994 the Treasury Department’s precursor of FinCEN, the Office of Financial Enforcement
    was merged with FinCEN.

  • [16] FinCEN estimated that it would have data access agreements with 80 percent of state agencies that conduct BSA examinations after 2012.

  • The partnership between the financial community and law enforcement allows disparate bits of information to be identified, centralized, and rapidly evaluated.

  • [2] The majority of the staff are permanent FinCEN personnel, with about 20 long-term detailees assigned from 13 different regulatory and law enforcement agencies.

  • Therefore multiple regulators examine compliance of the BSA across industries and for some larger holding companies even within the same institution.


Works Cited

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