FinCEN Director Touts Advances To Expedite Bank Secrecy Act Data Analysis
By David Quinones | April 2, 2013 8:08 am

The director of the Treasury Department’s Financial Crimes Enforcement Network (FinCEN) says its analysts are being equipped with new tools to assess data reported by financial institutions, which should lead to faster response times.

Jennifer Shasky Calvery delivered remarks at an anti-money laundering compliance conference on March 19 that offered the assembled AML, audit and compliance crowd a peak inside the clandestine process of what happens to the information FinCEN receives via numerous financial reporting tools such as Suspicious Activity Reports (SARs), Currency Transaction Reports (CTRs) and others required under the Bank Secrecy Act.

“Very soon, we will be able to quickly point law enforcement and other stakeholders to precisely where they should be looking,” Calvery said. “If you have one case of money laundering or drug trafficking that you’re particularly proud of finding, let us help you find 20 more just like it.”

She said an expedited process is in the works thanks to information technology advances in the department.

After 15 years in the Department of Justice, including two years as chief of the Asset Forfeiture and Money Laundering Section, Calvery replaced Jim Freis as the head of the U.S. financial intelligence unit last September.

Up to now, FinCEN employed an ad hoc collection of tools to analyze the mountains of data, slowing the response time and making it easy for sophisticated financial criminals to stay many steps ahead of law enforcement. Calvery did not say exactly when this more robust platform would be go into effect, but did say it would be seamless to the point that fraudsters would no longer enjoy the head start they have to this point.

In recent years, FinCEN has drawn the ire of some AML compliance professionals who complain that little seems to come of the seemingly countless reports they file each year, disappearing behind an opaque wall of secrecy that cannot be accessed or shared beyond other FIUs. So far in 2013 some 270,000 SARs have been filed, and beginning April 1 the Treasury Department will require that they be filed electronically, a move that has put some less-prepared compliance departments on their heels.

Calvery added that FinCEN analysts are continuing to improve their analytic capability by expanding their knowledge base into newer types of money transmission, such as virtual currency, an emerging area for which she said her agency is in the process of releasing guidance. FinCEN is also applying its new data analysis methodology to the trendiest of financial crimes: healthcare and tax refund fraud.

FinCEN analysts have found that at their root, both healthcare and tax refund fraudsters move through the financial system via check cashing and money services businesses – an assertion backed up by BSA reporting, according to Calvery.

“What our analysts do very well is look across all that data to find trends and patterns within the data and to understand the changes and shifts within it,” Calvery said. “They also combine that data with other law enforcement and publicly available data.”

Calvery delivered the keynote address for the annual conference in Hollywood, Fla. The mainstay industry conference, which drew some 1,400 attendees, this year paid special attention to the intersection of money laundering and other financial crimes.


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