	Money Laundering: FinCEN’s Law Enforcement Support, Regulatory, and International Roles

Mr. Chairman and Members of the Subcommittee: I am pleased to be here today to discuss the various anti-money laundering roles of the Treasury Department’s Financial Crimes Enforcement Network (FinCEN). of, products and services provided by FinCEN to the law enforcement community; (2) the process for developing and issuing BSA regulations; (3) FinCEN’s efforts in assessing civil penalties for BSA violations; and (4) the role FinCEN plays in promoting international awareness of money laundering. The other is Project Gateway, which provides designated state and local law enforcement officials with direct, on-line access to BSA financial data. A primary reason FinCEN officials gave for this change is that FinCEN’s staffing levels have remained fairly constant over the years, while its overall mission has expanded. Survey results generally did not indicate dissatisfaction with FinCEN’s products. These reasons included reliance on in-house capabilities and the availability of intelligence or analytical support centers other than FinCEN. According to the federal and state officials we interviewed, these self-help programs are useful to agencies in combating money laundering and other financial crimes. Further, at the time of our review, final regulations to implement several provisions of the 1994 act were still pending. Unquestionably, the intended law enforcement benefits of the MLSA amendments cannot be fully achieved until all of the regulations are implemented. We concluded that FinCEN needs to better communicate its regulatory priorities and time lines, particularly regarding regulations authorized or required by the MLSA. We are working with FinCEN to determine the reasons for the increase in processing times in recent years. A main purpose of FATF is to promote the development of effective anti-money laundering controls. FinCEN has helped establish these units, which serve as the central focal points for other countries’ anti-money laundering efforts. FinCEN’s Office of International Programs is the agency’s second largest organizational component.
Why GAO Did This Study

GAO discussed the various anti-money laundering roles of the Department of the Treasury's Financial Crimes Enforcement Network (FinCEN).

What GAO Found

GAO noted that: (1) FinCEN was established in 1990 to support law enforcement agencies by analyzing and coordinating financial intelligence information to combat money laundering; (2) in supporting law enforcement, FinCEN has issued fewer analytical products in fewer years; (3) a primary reason FinCEN officials gave for this change is that FinCEN's staffing levels have remained fairly constant, while its overall mission has expanded; (4) also, FinCEN has been encouraging and training other federal, state, and local law enforcement agencies to access and analyze source data directly either through FinCEN resources or their own; (5) federal and state officials GAO interviewed indicated general satisfaction with FinCEN's products and services; (6) most nonusers told GAO that they rely on in-house capabilities or use intelligence or analytical support centers other than FinCEN; (7) GAO's recent report on FinCEN's regulatory role concluded that FinCEN needs to better communicate its regulatory priorities and time lines, particularly regarding regulations authorized or required by the Money Laundering Suppression Act (MLSA) of 1994; (8) FinCEN did not meet any of the three statutory deadlines imposed by the 1994 act, and final regulations for several provisions of the act are still pending; (9) the intended law enforcement benefits of the MLSA amendments cannot be fully achieved until all of the regulations are implemented; (10) in 1992, GAO reported that Treasury was taking about 21 months, on average, to process civil penalty referrals for Bank Security Act violations; (11) since then, the average has grown to about 3 years, according to FinCEN data; (12) GAO is working with FinCEN to identify reasons for the increase in processing time; (13) FinCEN's principal international efforts include: (a) working with international organizations to promote the development of effective anti-money laundering controls; and (b) helping other nations establish financial intelligence units, which serve as the central focal points for these countries' anti-money laundering efforts; and (14) FinCEN's Office of International Programs is the agency's second largest organizational component.