By Cody Roberts, CRCM
BSA Report Oblivion is seemingly the place all BSA reports, such as SARs and CTRs, go once a financial institution files them. Much like a black hole in space draws in all nearby matter and energy, these reports can seem to draw all of a BSA officer’s energy and time, never to be heard about again. This makes sense as most such filings are never further discussed with the institution by law enforcement or other governmental agencies.
However, FinCEN’s annual Law Enforcement Awards program reminds us that BSA reports are not forgotten in oblivion. FinCEN presents awards to law enforcement agencies that use Bank Secrecy Act reporting provided by financial institutions in their criminal investigations. Now in its third year, this program recognizes law enforcement agencies that make effective use of financial institution reporting in successful prosecution in six categories.
At the 2017 awards program (hosted by Jimmy Kimmel), awards went to a diverse group of agencies, involving a wide range of criminal activities. Each case highlights the importance of information provided by a financial institution. See, BSA reports actually help the fight against money laundering and other crimes.
- In the SAR Review Task Force: New York State Police case, “The impetus of the investigation was a single financial institution reporting an unusual pattern of cash deposits. The reporting bank indicated that it believed much of the cash was derived from the illegal sale of marijuana.”
Do SARs filed by a single bank make a difference? Absolutely.
- In the Transnational Organized Crime: Federal Bureau of Investigation case, “Investigators then used this information to identify additional accounts and transactions involving these newly identified targets at financial institutions located throughout the United States. These financial institutions described suspected money laundering activity though a series of businesses and trust accounts located in several countries. Investigators also identified additional ongoing criminal investigations by other agencies targeting this same network of individuals.”
Can banks’ BSA reporting extend an investigation globally? Certainly.
- In the Cyber Threats: Internal Revenue Service-Criminal Investigation (IRS-CI) case, “Sensitive financial information identified during the course of this investigation detailed specific information that corroborated the financial and personal information of the subjects of the investigation. The data also indicated that the subjects were using Bitcoins in an effort to conceal their illicit proceeds. The information identified in the financial data and from subpoenas issued to numerous financial institutions and Bitcoin exchangers helped clarify the convoluted series of transactions conducted to launder the funds….The targets were subsequently indicted and pled guilty to various drug and money laundering charges. This is notable since this is the first case in this particular Midwest district where money laundering charges were approved based on Bitcoin transactions.” Should you expand monitoring to include Bitcoin-related transactions? Definitely.
- In the Significant Fraud: Defense Criminal Investigative Service (DCIS) case, “DCIS initiated a long-term investigation based on structuring and excessive credit card charges identified by multiple financial institutions on a single individual.” Do reports filed by multiple banks make a difference? Undeniably.
- In the Third-Party Money Launderers: Immigration and Customs Enforcement Homeland Security Investigations (HSI) case, “Over the course of 18 months, HSI investigators utilized an extensive volume of sensitive financial information to assist in their investigation into a large-scale illegal third-party money laundering organization. The investigation began based largely on information gleaned from a FinCEN-issued Geographic Targeting Order (GTO)…Subpoenas were issued to the banks …. Transaction records identified cash deposits of $45 million over a 15-month period ….” Do you need to be aware of GTOs? Unquestionably.
The cases illustrate that the BSA reports and responses you process make a difference. Keep up the good work—law enforcement appreciates it and utilizes it.
The May 9, 2017 “FinCEN Awards Recognize Law Enforcement Success Stories Supported by Bank Secrecy Act Reporting” press release from FinCEN is available here.
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