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Just in time for the RV!~


New FenCEN law just passed and in effect!

U.S. rule directs banks to share data abroad

2010/02/08

WASHINGTON, Feb. 8, 2010 , A U.S. financial crime agency has adopted a rule allowing local, state and foreign police agencies to seek information from American banks, despite opposition from industry groups.

The rule broadens one adopted by the Financial Crimes Enforcement Network (FinCEN), a division of the U.S. Treasury Department, after the September 11 attacks.

That original rule allowed FinCEN to require financial institutions to search their records to determine whether they maintained accounts or conducted transactions with individuals that federal law enforcement agencies suspect, "based on credible evidence," have engaged in terrorist activity or money laundering.

FinCEN had said it wanted to expand the rule because of its success in helping track terrorist financing and major money laundering cases and to satisfy treaty obligations with the European Union.

FinCEN, established in 1990 to provide and analyze financial intelligence, administers the Bank Secrecy Act. The act requires financial institutions to submit reports to the government aimed at preventing money laundering.

The agency said on Friday that expanding the rule to foreign law enforcement agencies would "greatly benefit the United States by granting law enforcement agencies in the United States reciprocal rights to obtain information about matching accounts in EU member states."

More than half a dozen financial trade groups and associations, including the American Bankers Association and the Credit Union National Association, opposed the expanded rule as too burdensome and intrusive.

In a 13-page letter, ABA Vice President Robert Rowe called it "premature and unfounded" and said it represented a "dangerous broadening" of the information-sharing process.

"There is absolutely no indication that the extraordinary power available under the 314(a) data-match program was ever intended by Congress to be put at the service of foreign countries," he wrote, referring to FinCEN regulations that are part of the USA Patriot Act of 2001.

But FinCEN said the same vetting process currently used for federal law enforcement requests would be applied to requests made by foreign, state and local police agencies.

Among other things, FinCEN said it will require them to certify that, in the case of money laundering, the matter is significant and they have not been able to obtain the information they seek through traditional methods of investigation.

And foreign law enforcement requests will be required to submit their requests to a federal law enforcement attache.

In a statement, FinCEN Director James Freis said that while the searches requested of financial institutions were simple and sought very limited information, "the threads they provide are crucial to investigators and are often the key to weaving together successful cases."

FinCEN began processing requests under the old rule in November 2002. As of June 2009, it had processed 988 requests submitted by 22 federal agencies, according to FinCEN. Of those, 302 cases were related to terrorism or terrorism financing and 686 related to money laundering.

FinCEN said that 54 percent of the requests had contributed to arrests or indictments.

newsdaily.com/stories/tre6173zl-us-fincen-rule/

and ...

February 4th, 2010

Increased Information Sharing

FinCEN is also working with its interagency partners to develop additional ways to call attention to individuals and regimes of public corruption concern. One important initiative that we are currently enhancing is the information-sharing mechanism provided through Section 314(a) of the USAPA, which enables Federal law enforcement agencies, through FinCEN, to reach out to more than 45,000 points of contact at more than 25,000 financial institutions to locate accounts and transactions of persons that may be involved in terrorism or money laundering, including laundering of foreign corrupt assets.

There are two primary processes and related forms required from federal law enforcement officials when submitting a 314(a) request. First, the requester must complete a subject information form, which contains the identifying information of the suspects under investigation. Second, the requester must complete a certification form which provides background information on the investigation and allows FinCEN to review and determine whether the case meets the 314(a) process standards.

These standards mandate that the requester has already exhausted traditional avenues of investigation and analysis and that the investigation involves terrorism/terrorist financing and/or significant money laundering. The significance of a money laundering case may, for example, be determined upon the following factors:

Seriousness and magnitude of suspected criminal conduct;
Dollar amount involved;
Whether the investigation is being conducted as part of a multi-agency task force;
Whether the investigation is time sensitive;
Importance of the investigation to agency program goals;
Multi regional implications;
Criminal organization(s) involvement; and/or
National security implications.
The 314(a) certification form inquires as to whether the investigation involves a public or political official. If the requester indicates that it does, our process provides for a review by select members of FinCEN's senior management in order to ensure that the request meets the aforementioned standards.

Although the 314(a) program is specifically intended to support terrorist financing/terrorism and/or significant money laundering investigations, there may also be instances where a request tangentially references a suspected corrupt foreign official(s) who is implicated in the suspected money laundering activity. In this manner, the use of the 314(a) program may also, ultimately, turn out to be helpful in combating foreign corruption. That is to say, provided the overall investigative request meets the necessary core criteria of significant money laundering and/or terrorism/terrorist financing, the 314(a) system may reap benefits in combating significant money laundering cases premised on high-level or otherwise significant instances of foreign official corruption.

Based upon its proven track record of success and pursuant to international treaty provisions, FinCEN is proposing to expand the 314(a) program to international and domestic State and local users.

International Users: In order to satisfy U.S. treaty obligations with certain foreign governments, FinCEN is proposing to extend the use of the 314(a) program to include certain foreign law enforcement agencies. On June 25, 2003, the Agreement on Mutual Legal Assistance between the United States and the European Union (U.S.-EU MLAT) was signed. Article 4 of the U.S.-EU MLAT (entitled Identification of Bank Information) obligates a requested Signatory State to search on a centralized basis for bank accounts within its territory that may be important to a criminal investigation in the requesting Signatory State. In negotiating the terms of Article 4, the United States expressly envisioned that the 314(a) program would be utilized to meet our obligations under this treaty and thus, EU member states would be able to submit case requests to the 314(a) program under these stringent guidelines. Expanding this process to include certain foreign law enforcement requesters will greatly benefit the United States by granting law enforcement agencies in the United States reciprocal rights to obtain information about matching accounts in those countries.

State and Local Users: FinCEN is also proposing to extend the 314(a) program to domestic State and local law enforcement users. Money laundering and terrorist-related financial crimes are not limited by jurisdiction or geography. Detection and deterrence of these crimes require information sharing across all levels of investigative authorities, to include State and local law enforcement, to ensure the broadest U.S. Government action. Access to the 314(a) program by State and local law enforcement agencies will provide a platform from which they can more effectively and efficiently fill information gaps, including those connected with multi-jurisdictional financial transactions, in the same manner as federal law enforcement agencies. This expansion of the 314(a) program, in certain limited circumstances, to include State and local law enforcement authorities, will benefit overall efforts to ensure that all law enforcement resources are made available to combat money laundering and terrorist financing.

Building on its continued advancement of robust information sharing, the Egmont Group of 116 financial Intelligence Units (FIUs) has forged a consensus among its members regarding an increased focus on the fight against corruption9. The FIUs will continue to work with their law enforcement partners in individual cases as well as in partnership with other international stakeholders including the United Nations, the Financial Action Task Force (FATF), and the World Bank to contribute information and expertise on various anti-corruption projects, studies, and initiatives
http://www.fincen.gov/news_room/testimony/html/20100204.html