GAO 

United States Government Accountability Office

Report to the Committee on Finance, 

United States Senate 

COMBATING ILLICIT 

FINANCING 

Treasury’s Office of 

Terrorism and 

Financial Intelligence 

Could Manage More 

Effectively to Achieve 

Its Mission 

September 2009 

GAO-09-794 
What GAO Found

United States Government Accountability Office

Why GAO Did This Study

Highlights

Accountability Integrity Reliability

September 2009

COMBATING ILLICIT FINANCING 

Treasury’s Office of Terrorism and Financial 

Intelligence Could Manage More Effectively to 

Highlights of GAO-09-794, a report to the Achieve Its Mission 

Committee on Finance, United States 

Senate 

In 2004, Congress combined 

preexisting and newly created units 

to form the Office of Terrorism and 

Financial Intelligence (TFI) within 

the Department of the Treasury 

(Treasury). TFI’s mission is to 

integrate intelligence and 

enforcement functions to (1) 

safeguard the financial system 

against illicit use and (2) combat 

rogue nations, terrorist facilitators, 

and other national security threats. 

In the 5 years since TFI’s creation, 

questioned have been raised about 

how TFI is managed and allocates 

its resources. As a result, GAO was 

asked to analyze how TFI (1) 

implements its functions, 

particularly in collaboration with 

interagency partners, (2) conducts 

strategic resource planning, and (3) 

measures its performance. To 

conduct this analysis, GAO 

reviewed Treasury and TFI 

planning documents, performance 

reports, and workforce data, and 

interviewed officials from Treasury 

and its key interagency partners. 

What GAO Recommends

GAO recommends, among other 

things, that the Secretary of the 

Treasury direct TFI to develop and 

implement (1) mechanisms to 

improve interagency collaborative 

efforts, (2) a process to improve 

strategic resource planning, and (3) 

performance measures that exhibit 

the key attributes of successful 

performance measures. Treasury 

commented that it plans to 

redouble some current efforts and 

undertake some new efforts that 

address GAO’s recommendations. 

TFI undertakes five functions, each implemented by a TFI component, in 

order to achieve its mission, as shown in the following table. 

TFI Components and Functions

Main function TFI component 

Year 

formed

Build international coalitions Office of Terrorist Financing and 

Financial Crime 

2004

Analyze financial intelligence Office of Intelligence and Analysis (OIA) 2004

Administer and enforce the Bank 

Secrecy Act 

Financial Crimes Enforcement Network 

(FinCEN) 

1990

Administer and enforce sanctions Office of Foreign Assets Control 1950

Administer forfeited funds Treasury Executive Office for Asset 

Forfeiture 

1992

Source: Treasury. 

TFI officials cite the analysis of financial intelligence as a critical part of TFI’s 

efforts because it underlies TFI’s ability to utilize many of its tools. They said 

that the creation of OIA was critical to Treasury’s ability to effectively identify 

illicit financial networks. To achieve its mission, TFI’s five components often 

work with each other, other U.S. government agencies, the private sector, or 

foreign governments. Officials from TFI and its interagency partners cited 

strong collaboration in many areas, such as effective information sharing 

between FinCEN and the Justice Department (Justice). Officials differed, 

however, about the quality of interagency collaboration involving 

international forums. Treasury officials who led this collaboration stated that 

it runs smoothly and that they were unaware of any significant concerns, 

while Justice and State officials reported declining collaboration and unclear 

mechanisms to enhance or sustain it. 

While TFI and some of its components have conducted selected strategic 

resource planning activities, TFI as a unit has not fully adopted key practices 

that enhance such efforts. For example, TFI and its components have 

produced multiple strategic planning documents in recent years, but the 

objectives in some of these documents are not clearly aligned with resources 

needed to achieve them. As a result, it may be unclear whether TFI has 

sufficient resources to address its objectives. Also, though TFI has 

undertaken some workforce planning activities, it lacks a process for 

performing comprehensive strategic workforce planning. Thus, it is unclear 

whether TFI is able to effectively address persistent workforce challenges. 

Also, TFI has not yet developed appropriate performance measures, changing 

their number and substance each year. Though TFI’s current measures fully 

address many attributes of effective performance measures, they do not cover 

all TFI core program activities. TFI officials acknowledge the need for 

improvement and have worked since 2007 to develop one overall performance 

measure to assess TFI. Yet questions remain about when TFI will implement 

its new measure and whether it will effectively gauge TFI’s performance. 

View GAO-09-794 or key components.

For more information, contact Loren Yager at 

(202) 512-4347 or YagerL@gao.gov. 
Page i GAO-09-794 

Contents 

Letter 1

Background 2 

TFI Performs Five Functions to Fulfill Its Mission, but Agencies 

Differ about the Quality of Some Interagency Collaboration 7 

TFI Has Not Clearly Aligned Its Resources with Priorities or 

Performed Comprehensive Workforce Planning 16 

TFI Has Not Yet Developed an Appropriate Set of Performance 

Measures, but Continues to Work to Improve Its Efforts 23 

Conclusions 30 

Recommendations for Executive Action 31 

Agency Comments and Our Evaluation 31 

Appendix I Scope and Methodology 34 

Appendix II Current U.S. Sanctions Programs 36 

Appendix III GAO Assessment of TFI’s Fiscal Year 2008 

Performance Measures 37 

Appendix IV Comments from the Department of the Treasury 40 

Appendix V GAO Contact and Staff Acknowledgments 45 

Table 

Table 1: GAO’s Key Attributes of Successful Performance Measures 25 

Figures 

Figure 1: TFI Organizational Chart 4 

Figure 2: TFI Staffing Levels, Fiscal Years 2005-2008 6 

Figure 3: TFI Funding Levels, Fiscal Years 2005-2008 7 

 Combating Illicit Financing 
Figure 4: Changes in TFI Performance Measures, Fiscal Years 2005 

to 2008 24 

Figure 5: TFI’s Fiscal Year 2008 Performance Measures Relative to 

the Key Attributes of Successful Performance Measures 26 

Abbreviations 

BSA Bank Secrecy Act 

FATF Financial Action Task Force 

FSRB FATF-Style Regional Body 

FTE full-time equivalent 

OFAC Office of Foreign Assets Control 

OIA Office of Intelligence and Analysis 

OMB Office of Management and Budget 

OSPPM Office of Strategic Planning and Performance 

Management 

OTA Office of Technical Assistance 

PART Program Assessment Rating Tool 

SAR suspicious activity report 

TEOAF Treasury Executive Office for Asset Forfeiture 

TFFC Office of Terrorist Financing and Financial Crimes 

TFI Office of Terrorism and Financial Intelligence 

USA PATRIOT Uniting and Strengthening America by Providing 

Appropriate Tools Required to Intercept and 

Obstruct Terrorism 

WMD weapons of mass destruction 

This is a work of the U.S. government and is not subject to copyright protection in the 

United States. The published product may be reproduced and distributed in its entirety 

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Page ii GAO-09-794 Combating Illicit Financing
Page 1 GAO-09-794 

 

United States Government Accountability Office

Washington, DC 20548 

 

September 24, 2009 

The Honorable Max Baucus 

Chairman 

The Honorable Charles E. Grassley 

Ranking Member 

Committee on Finance 

United States Senate 

While the globalization of finance and trade has the potential to enhance 

economic prosperity and stability across the world, some individuals, 

organizations, and countries that pose a threat to U.S. national security 

have exploited worldwide financial channels. Governmentwide strategies, 

such as the 2006 National Strategy for Combating Terrorism and the 

2007 National Money Laundering Strategy acknowledge the threats 

posed by the illicit use of the international financial system by terrorist 

organizations, weapons of mass destruction (WMD) proliferators, drug 

kingpins, and other national security threats. In 2004 Congress established 

the Office of Terrorism and Financial Intelligence (TFI) to provide policy, 

strategic, and operational direction to the Department of the Treasury’s 

(Treasury) efforts to address issues such as terrorism financing, financial 

crimes, and intelligence analysis.1

Based on your interest in TFI, this report assesses how TFI (1) implements 

functions to fulfill its mission, particularly in collaboration with 

interagency partners; (2) conducts strategic resource planning; and 

(3) measures its performance. 

To meet these objectives, we reviewed documents and interviewed 

officials from Treasury and its key interagency partners. To analyze TFI’s 

implementation of its functions, we reviewed Treasury reports and 

documents related to its efforts since 2004. We also interviewed officials 

from Treasury and its key interagency partners, the Departments of State 

(State) and Justice (Justice), to review interagency collaboration efforts. 

To analyze TFI’s efforts to conduct strategic resource planning, we 

reviewed documentation relating to TFI’s strategies (notably strategic 

plans), analyzed data on TFI resources for 2005 through 2008, and 

interviewed TFI officials involved in resource planning, including the 

1

Pub. L. No 108-447, Div. H, Title II, Section 222, Dec. 8, 2004, 31 U.S.C. § 313. 

 Combating Illicit Financing 
 

Under Secretary for Terrorism and Financial Intelligence. To analyze how 

TFI measures its performance, we reviewed Treasury’s performance 

measures included in its performance and accountability reports for 2005-

2008 and interviewed officials from TFI and Treasury’s Office of Strategic 

Planning and Performance Management. We conducted this performance 

audit from July 2008 to September 2009, in accordance with generally 

accepted government auditing standards. Those standards require that we 

plan and perform the audit to obtain sufficient, appropriate evidence to 

provide a reasonable basis for our findings and conclusions based on our 

audit objectives. We believe that the evidence obtained provides a 

reasonable basis for our findings and conclusions based on our audit 

objectives. See appendix I for additional details regarding our scope and 

methodology. 

After the September 11, 2001, terrorist attacks, Congress passed the 

Uniting and Strengthening America by Providing Appropriate Tools 

Required to Intercept and Obstruct Terrorism (USA PATRIOT) Act of 

2001,2

 which amended and broadened the scope of the Bank Secrecy Act 

(BSA)3

 to include additional financial industry sectors and a focus on the 

financing of terrorism. Subsequently, Congress passed the Intelligence 

Authorization Act for 2004,4

 which established Treasury’s Office of 

Intelligence and Analysis (OIA). OIA is a member of the Intelligence 

Community, as defined under Executive Order 12333, as amended. The 

Intelligence Reform and Terrorism Prevention Act of 20045

 identified the 

Secretary of the Treasury or his or her designee as the lead U.S. 

Background 

 

2

Pub. L. No. 107-56, Oct. 26, 2001. 

3

The Bank Secrecy Act of 1970 requires U.S. financial institutions to assist U.S. government 

agencies to detect and prevent money laundering. Specifically, the act requires financial 

institutions to, among other things, keep records of purchases of negotiable instruments, 

file reports of cash transactions exceeding $10,000 (daily aggregate amount), and report 

suspicious activity relevant to a possible violation of law such as money laundering, tax 

evasion, or other criminal activities. 

4

Pub.L No.108-177, Dec. 13, 2003. 

5

Pub. L No.108-458, Dec. 17, 2004. 

Page 2 GAO-09-794 Combating Illicit Financing
 

government official to the Financial Action Task Force (FATF),6 to 

continue to convene an interagency working group on FATF issues. TFI’s 

mission is to marshal Treasury’s policy, enforcement, regulatory, and 

intelligence functions in order to safeguard the U.S. financial system from 

abuse and sever the lines of financial support to international terrorists, 

WMD proliferators, narcotics traffickers, money launderers, and other 

threats to U.S. national security. 

The formation of TFI combined both existing and new units of Treasury. 

Five key components are included under the umbrella of TFI: 

• Office of Foreign Assets Control (OFAC), formed in 1950, administers and 

enforces sanctions. 

• Financial Crimes Enforcement Network (FinCEN), formed in 1990, 

administers and enforces the BSA and serves as the United States’ 

financial intelligence unit (FIU).7

• Treasury Executive Office for Asset Forfeiture (TEOAF), formed in 1992, 

administers the Treasury Forfeiture Fund—the receipt account for the 

deposit of non-tax forfeitures made by member agencies. 

• Office of Terrorist Financing and Financial Crimes (TFFC), established in 

2004, serves as TFI’s policy and outreach arm. 

• OIA, also established in 2004, performs Treasury’s intelligence functions, 

integrating Treasury into the larger Intelligence Community, and providing 

intelligence support to Treasury leadership. 

FinCEN is a Treasury bureau; 8

 the other four components are offices 

within TFI, which is a part of Treasury’s structure of departmental offices. 

Figure 1 shows TFI’s current organizational structure. 

 

6

The FATF is an intergovernmental body that develops and promotes international 

standards for combating money laundering and the financing of terrorism. Established in 

1989, it currently has 34 members and more than 20 observers, including eight FATF-style 

regional bodies. The FATF works to generate the necessary political will to bring 

about legislative and regulatory reforms in anti-money laundering and counterterrorist 

financing. 

7

An FIU is a central national agency responsible for receiving (and as permitted, 

requesting), analyzing, and disseminating disclosures of financial information concerning 

potential financing of terrorism or money laundering. 

Page 3 GAO-09-794 Combating Illicit Financing
 

Figure 1: TFI Organizational Chart 

To achieve its mission, TFI components often work with the following: 

Office of Terrorism and

Financial Intelligence 

Financial Crimes

Enforcement

Network 

Office of Terrorist

Financing and

Financial Crimes

Office of Intelligence

and Analysis

Treasury Executive

Office for Asset

Forfeiture 

Office of Foreign

Assets Control 

Source: GAO analysis of Treasury documents.

• Other U.S. government agencies. For instance, OFAC works with State 

and Justice, among others, to designate individuals and organizations 

under 21 separate sanctions programs.9

 TFFC also works with State, 

Justice, and other agencies in developing and advocating a U.S. position in 

international forums related to money laundering and illicit financing. In 

addition, TEOAF works with State and Justice to administer sharing of 

large case forfeiture proceeds with foreign governments, pursuant to 

international treaties, whose law enforcement personnel cooperated with 

U.S. federal investigations. 

 

8

Treasury is organized into two major parts: the departmental offices and bureaus. The 

departmental offices are primarily responsible for the formulation of policy, while the 

bureaus carry out the specific operations assigned to the department. Accounting for 98 

percent of the Treasury workforce, the bureaus include the Bureau of Engraving and 

Printing, the U.S. Mint, FinCEN, the Internal Revenue Service, and the Bureau of the Public 

Debt, among others. 

9

A U.S. sanction is any restriction or condition on economic activity with respect to a 

foreign country or foreign nationals, or property in which a foreign country or foreign 

national has an interest, that is imposed by the United States for reasons of foreign policy 

or national security. For example, financial sanctions may be targeted against persons 

designated as either weapons of mass destruction proliferators or global terrorists, 

depending on which set of sanctions is employed, and any transactions with them by U.S. 

persons are prohibited and any property they have within the United States is blocked. 

According to Treasury, the goal of such actions is to deny sanctioned parties access to the 

U.S. financial and commercial systems. Treasury, and State, under certain programs, can 

make designations under these sanctions authorities, which are published in the Federal 

Register. 

Page 4 GAO-09-794 Combating Illicit Financing
 

• Other TFI components. For example, OIA provides information to OFAC 

to assist in making decisions regarding whether to pursue designations of 

individuals and organizations. For completed designations, OIA also works 

with OFAC to declassify intelligence information for public dissemination. 

• Private sector. For example, in its role as the Secretary’s delegated 

administrator of the BSA, FinCEN regularly interacts with the private 

sector, including the financial sector. One such mechanism for maintaining 

formal ties to the private sector is Treasury’s BSA Advisory Group. 

FinCEN also conducts informal consultations with financial institutions 

regarding their individual financial intelligence efforts. 

• Foreign governments and international organizations. Treasury heads 

the U.S. delegation to the FATF, an international body that develops and 

implements multilateral standards relating to anti-money laundering and 

counterterrorist financing. TFFC leads this effort on behalf of Treasury. 

Similarly, FinCEN works with foreign governments to develop and 

strengthen capabilities of their FIUs as well as to respond to requests for 

assistance from foreign FIUs, which totaled more than 1,000 in fiscal year 

2008. 

As shown in figure 2, the size of TFI’s staff has grown from approximately 

500 in fiscal year 2005 to approximately 650 in fiscal year 2008. FinCEN, 

with 299 full-time equivalents (FTE) in fiscal year 2008, is TFI’s largest 

component, and OIA gained the most staff—90—from fiscal years 2005 

through 2008. 

Page 5 GAO-09-794 Combating Illicit Financing
 

Figure 2: TFI Staffing Levels, Fiscal Years 2005-2008 

As shown in figure 3, TFI’s budget has grown from approximately $110 

million in fiscal year 2005 to approximately $140 million in fiscal year 2008. 

With a budget of approximately $86 million, FinCEN has the largest budget 

of any TFI component. In addition, OIA’s budget has grown at the greatest 

rate, from about $9 million in fiscal year 2005 to about $20 million in fiscal 

year 2008. 

0

100

200

300

400

500

600

700

2005 2006 2007 2008

Budget (Dollars in millions)

Fiscal year

TEOAF

TFFC

OIA

OFAC

FinCEN

Source: GAO analysis of TFI data.

291

132 125 139 155.5

135

34

22

30

21

21

20

28

19 105 91

45

299 290 299

Page 6 GAO-09-794 Combating Illicit Financing
 

Figure 3: TFI Funding Levels, Fiscal Years 2005-2008 

Note: TEOAF’s budget is not congressionally appropriated. It is derived from the Treasury Forfeiture 

Fund. 

Budget (in millions)

Fiscal year

TFFC

OIA

OFAC

FinCEN

Source: GAO analysis of TFI budget data.

0

20

40

60

80

100

120

140

160

2005 2006 2007 2008

71.9

24.5

8.9 11.6 13.3

19.7

5.4

4.6 4.1 3.6

21.8 23.8

28.8

72.9 73.2

85.8

According to TFI, it undertakes five functions in order to achieve its 

mission. Officials from TFI and its interagency partners cited strong 

collaboration with TFI in several areas, but differ about the quality of 

collaboration regarding U.S. participation in some international forums. 

TFI Performs Five 

Functions to Fulfill Its 

Mission, but Agencies 

Differ about the 

Quality of Some 

Interagency 

Collaboration 

Page 7 GAO-09-794 Combating Illicit Financing
 

According to TFI, it undertakes five functions to safeguard the financial 

system from illicit use and to combat rogue nations, terrorist supporters, 

WMD proliferators, money launderers, drug kingpins, and other national 

security threats. These functions are (1) building international coalitions, 

(2) analyzing financial intelligence, (3) administering and enforcing the 

BSA, (4) administering and enforcing sanctions, and (5) administering 

forfeited funds. 

TFI employs two primary means to build international coalitions to 

support U.S. national security interests. These are deepening engagement 

in international forums and improving international partners’ capacity. 

TFI Performs Five 

Functions to Fulfill Its 

Mission 

Building International 

Coalitions 

• Deepening engagement in international forums. TFI and other U.S. 

agencies participate in several international organizations intended to 

strengthen the international financial system so that it cannot be exploited 

by criminal networks. Two examples are the FATF and the Egmont 

Group.10 TFFC leads the U.S. delegation to the FATF, while FinCEN leads 

U.S. participation in the Egmont Group. According to TFI officials, U.S. 

participation in such organizations provides a unique opportunity to 

engage with international counterparts in the effort to develop 

international standards and a framework for countries to implement legal 

regimes that protect the international financial system from abuse. 

TFI also uses international forums to advance the U.S. agenda in areas 

such as nonproliferation. For example, according to TFI, it has been 

working closely with other G-7 countries to determine what steps can be 

taken to isolate proliferators from the international financial system 

through multilateral action.11 For instance, according to TFI officials, they 

are working with State to encourage the more than 85 countries that 

 

10The Egmont Group is a global association of FIUs, currently with 116 members. The 

Egmont Group provides a forum for FIUs from around the world to cooperate in the fight 

against money laundering and financing of terrorism through information exchange, 

training, and the sharing of expertise in order to foster the implementation of domestic 

programs in member countries. 

11G-7 refers to the Group of Seven Finance Ministers and Central Bank Governors, which 

includes Canada, France, Germany, Italy, Japan, the United Kingdom, and the United 

States. The G-7 has met regularly since the mid-1980s. 

Page 8 GAO-09-794 Combating Illicit Financing
 

participate in the Proliferation Security Initiative to use financial measures 

to combat proliferation support networks.12

In addition to playing a leadership role in these organizations and forums, 

TFI officials report that they are also working to expand these 

organizations’ membership so as to broaden the reach of international 

financial standards. For example, as of March 2009, FinCEN was 

sponsoring 12 countries’ membership in the Egmont Group, including 

Afghanistan, Saudi Arabia, Pakistan, and Yemen. According to FinCEN 

officials, the addition of such new members will greatly strengthen 

FinCEN’s ability to obtain valuable information related to the activities of 

illicit financial networks. 

• Improving international partners’ capacity. As part of TFI, FinCEN has 

made engagement with foreign FIUs in the detection and deterrence of 

crime one of its strategic objectives. To accomplish this objective, FinCEN 

has undertaken a variety of efforts to strengthen the global network of 

FIUs. For example, according to FinCEN officials, they engage in a variety 

of cooperative efforts with other FIUs aimed at fostering productive 

working relationships and best practices. In addition, according to TFI 

officials, they participate in mutual evaluation studies, as part of its 

participation in the FATF, to identify measures to improve other FATF 

members’ regulatory regimes related to combating money laundering and 

terrorist financing.13 For example, in fiscal year 2008, the FATF performed 

 

12The Proliferation Security Initiative is a multinational effort to prevent the trafficking of 

WMD, their delivery systems, and related materials to and from states and nonstate actors 

of proliferation concern. The Proliferation Security Initiative has no formal organization or 

bureaucracy. U.S. agencies are involved in the Proliferation Security Initiative as a set of 

activities, rather than a program. The Proliferation Security Initiative encourages 

partnership among states to work together to develop a broad range of legal, diplomatic, 

economic, military, law enforcement, and other capabilities to prevent WMD-related 

transfers to states and nonstate actors of proliferation concern. International participation 

is voluntary, and there are no binding treaties on those who choose to participate. 

13The mutual evaluation program is the primary instrument by which the FATF monitors 

and assesses progress made by member governments in implementing the FATF 

Recommendations, which are designed to prevent use of financial systems for money 

laundering or terrorist financing. FATF assessors work to identify the systems and 

mechanisms developed by countries with diverse legal, regulatory, and financial 

frameworks, in order to implement robust anti-money laundering and counterterrorist 

financing systems. Using a set of established criteria, assessors observe the degree of 

compliance with FATF Recommendations as well as the effectiveness of a country’s antimoney laundering and counterterrorist financing regime. See FATF, Methodology for 

Assessing Compliance with the FATF 40 Recommendations and the FATF 9 Special 

Recommendations (Paris, France, 2004). 

Page 9 GAO-09-794 Combating Illicit Financing
 

six mutual evaluations; the United States delegation, led by TFFC, sent 

representatives to serve as assessors for four of these mutual evaluations. 

TFI officials cite OIA’s analysis of financial intelligence as a critical part of 

TFI’s efforts because it underlies TFI’s ability to utilize many of its tools. 

The first step in disrupting and dismantling illicit financial networks is 

identifying those networks, according to TFI officials. They said that the 

creation of OIA was critical to TFI’s ability to effectively identify these 

illicit financial networks. As a member of the broader intelligence 

community, OIA performs analysis of intelligence information related to 

national security threats with a view toward potential action and 

utilization of tools available to TFI. Staff in other TFI components and TFI 

management then use this intelligence analysis to draft papers to 

implement such strategies or actions. 

Analyzing Financial 

Intelligence 

In addition, TFI utilizes intelligence analysis to assess the impact of the 

actions it takes. For example, according to the Under Secretary for TFI, 

intelligence analysts have assessed the impact of previous financial 

actions taken to address the national security threat posed by North 

Korea. Those assessments were then used to shape the U.S. policy 

response to the most recent missile and nuclear tests by North Korea. 

According to TFI officials, FinCEN’s administration of the BSA plays a key 

role in TFI’s ability to achieve its mission. The BSA includes a variety of 

reporting and record-keeping requirements that provide useful information 

to law enforcement and regulatory agencies. For example, pursuant to the 

BSA, Treasury (FinCEN) requires financial institutions to report 

suspicious financial activities relevant to a possible violation of law. Such 

suspicious activity reports (SAR) are then analyzed by FinCEN and made 

available to the law enforcement and regulatory communities.14 In 2007, 

financial institutions filed nearly 1.3 million SARs, which federal, state, 

and local law enforcement agencies use in their investigations of money 

laundering, terrorist financing, and other financial crimes. 

Administering and Enforcing 

the BSA 

The BSA, as amended by the USA PATRIOT Act, also grants Treasury 

additional authorities, which are delegated to FinCEN, to combat money 

laundering and terrorist financing. For example, Section 311 of the USA 

 

14For additional information, see GAO, Bank Secrecy Act: Suspicious Activity Report Use 

Is Increasing, but FinCEN Needs to Further Develop and Document Its Form Revision 

Process, GAO-09-226 (Washington, D.C.: Feb. 27, 2009). 

Page 10 GAO-09-794 Combating Illicit Financing
 

PATRIOT Act amended the BSA to provide an additional tool to safeguard 

the U.S. financial system from illicit foreign financial institutions and 

networks.15 According to TFI officials, Section 311 is an important and 

extraordinarily powerful tool, as it authorizes Treasury to find a foreign 

jurisdiction, foreign financial institution, type of account, or class of 

transaction as being of “primary money laundering concern.” Such a 

finding enables Treasury to impose a range of special measures that U.S. 

financial institutions must take to protect against illicit financing risks 

posed by the target. These special measures range from enhanced recordkeeping and reporting requirements up to prohibiting U.S. financial 

institutions from maintaining certain accounts for foreign banks if they 

involve foreign jurisdictions or institutions found to be of primary money 

laundering concern. 

The imposition of economic sanctions has been a long-standing tool for 

addressing a range of national security threats. OFAC currently maintains 

primary responsibility for administering more than 20 separate sanctions 

programs. (See app. II for a list of current U.S. sanctions programs.) These 

sanctions programs fall into two categories: (1) country-based programs 

that apply sanctions to an entire country—such as Cuba, Iran, or Sudan—

and (2) targeted, list-based programs that address individuals or entities 

engaged in specific types of activities such as terrorism, WMD 

proliferation, or narcotics trafficking. For example, according to TFI 

officials, they use the authorities under the International Emergency 

Economic Powers Act and Executive Order 13224 to designate those who 

provide support to terrorists, freezing any assets they have under U.S. 

jurisdiction and preventing U.S. persons from doing business with them. 

From fiscal years 2004 through 2008, Treasury designated or supported the 

designation of more than 1,900 individuals and organizations under 

various sanctions programs. 

Administering and Enforcing 

Sanctions 

To help ensure compliance with U.S. sanctions programs, Treasury also 

has the authority to impose civil penalties on individuals and organizations 

that violate U.S. sanctions. From 2004 through 2008, OFAC imposed more 

than 1,500 civil penalties related to violations of its sanctions programs. As 

a result, OFAC assessed nearly $15 million in penalties. 

 

15We reported on Treasury’s Section 311 activities in GAO, USA PATRIOT Act: Better 

Interagency Coordination and Implementing Guidance for Section 311 Could Improve 

U.S. Anti-Money Laundering Efforts, GAO-08-1058 (Washington, D.C.: Sept. 30, 2008). 

Page 11 GAO-09-794 Combating Illicit Financing
 

According to TEOAF, an important tool in the U.S. fight against money 

laundering is asset forfeiture.16 Forfeiture assists in the achievement of 

TFI’s mission in two ways. First, asset forfeiture strips away the profit 

from illegal activity, thus making it less attractive. According to TEOAF, in 

fiscal year 2008 it received more than $500 million in total forfeiture 

revenue; the majority, after net expenses, came from forfeitures processed 

by Immigration and Customs Enforcement and the Internal Revenue 

Service–Criminal Investigation. Second, according to the Director of 

TEOAF, the revenue derived from such forfeited assets can be used to 

fund federal law enforcement activities, including initiatives directed at 

further combating illicit financing networks. For example, in fiscal year 

2008, TEOAF provided approximately $1 million in funding to Immigration 

and Customs Enforcement to provide training to international partners. 

Specifically, the funding was provided to allow the expansion of existing 

training activities to assist in combating bulk cash smuggling by terrorist 

groups and other criminal networks. 

Administering Forfeited Funds 

Despite General Approval 

of Interagency 

Collaboration with TFI, 

Agencies Differ on Quality 

of Collaboration for 

International Forums 

Collaborating with interagency partners is important to TFI’s ability to 

perform effectively. Many of the tools TFI utilizes to combat national 

security threats involve multiple agencies reviewing the proposed action. 

For example, according to Treasury officials, they consult with officials 

from State, Justice, and the Department of Homeland Security on 

decisions to designate individuals or organizations that support terrorism. 

In addition, other tools, such as advocating actions to strengthen the 

international financial system through the FATF, benefit from the 

expertise and input from collaboration with a variety of agencies, 

including State, Justice, the Securities and Exchange Commission, the 

Department of Homeland Security, and others. Prior GAO work has 

identified several practices that can enhance and sustain such interagency 

collaboration.17 One such practice is establishing compatible policies, 

procedures, and other means to operate across agency boundaries. 

 

16Asset forfeiture is a legal mechanism by which title to property involved in or derived 

from unlawful activity is divested to the United States. 

17GAO, Results-Oriented Government: Practices That Can Help Enhance and Sustain 

Collaboration among Federal Agencies, GAO-06-15 (Washington, D.C.: Oct. 21, 2005). 

Page 12 GAO-09-794 Combating Illicit Financing
 

Another practice is developing a mechanism for monitoring, evaluating, 

and reporting on the results of collaborative efforts.18

Officials at TFI and other agencies said that they generally are satisfied 

with the quality of interagency collaboration. TFI’s interagency partners 

report close, collaborative relationships in many situations. For example, 

State officials told us that they have strong working relationships with 

officials in almost all TFI components. They highlighted their 

collaboration with TFI during the designation process and suggested that 

it is generally effective. These officials commented that if State has 

information from its embassies abroad that indicates that a specific 

designation would be particularly damaging to U.S. foreign policy 

interests, they relay this information to Treasury and discuss alternative 

approaches. State officials added that the designation process operates 

effectively, even when agencies may have disagreements over a particular 

designation, because the National Security Council leads a process to 

coordinate terrorism designations. It serves as an impartial arbiter that 

prevents any single agency from exerting too much influence. In addition, 

Justice officials described a strong working relationship with FinCEN 

regarding asset forfeiture and money laundering issues. Specifically, they 

recounted effective communication and information sharing. For example, 

Justice officials told us that FinCEN has granted Justice access to BSA 

data, thus allowing Justice to perform its own analyses for law 

enforcement purposes. Additionally, Justice officials said that FinCEN has 

helped them utilize its network of international contacts at other 

countries’ FIUs. 

However, TFI’s interagency partners have expressed concerns regarding 

collaboration in other areas. For example, in September 2008, we reported 

that State and Justice expressed concerns regarding Treasury’s 

consultations with them when implementing Section 311 of the USA 

PATRIOT Act.19 In addition, TFI and other agencies’ officials differed 

about the effectiveness of interagency collaboration for the function of 

building international coalitions, particularly when participating in the 

 

18Other practices include (1) defining and articulating a common outcome, (2) establishing 

mutually reinforcing or joint strategies to achieve the outcome, (3) identifying and 

addressing needs by leveraging resources, (4) agreeing upon agency roles and 

responsibilities, (5) reinforcing agency accountability for collaborative efforts through 

agency plans and reports, and (6) reinforcing individual accountability for collaborative 

efforts through agency performance management systems. 

19GAO-08-1058. 

Page 13 GAO-09-794 Combating Illicit Financing
 

international forums of the FATF and FATF-Style Regional Bodies (FSRB). 

On the one hand, TFFC officials suggest that interagency collaboration 

regarding the FATF and FSRBs has been highly effective over the past 5 

years and that Treasury’s ability to effectively lead the U.S. delegation has 

been greatly strengthened by the participation of a wide variety of 

regulatory, law enforcement, and other agencies.20 The Deputy Assistant 

Secretary for Terrorist Financing and Financial Crimes added that during 

this time, there have been no major disagreements between agencies 

regarding the positions the United States should take in such international 

forums. TFI officials also stated that interagency collaboration runs 

smoothly and that they were unaware of any significant concerns 

regarding the quality of interagency collaboration. 

Officials from State and Justice, however, indicated that the quality of 

interagency collaboration regarding the FATF and FSRBs has declined 

substantially over the past 5 years. These officials expressed two types of 

concerns regarding TFI’s collaboration with other agencies regarding 

participation in international forums: (1) the exclusion of non-Treasury 

personnel in key situations and (2) the extent to which TFI makes 

unilateral decisions regarding the U.S. government position. 

With regard to TFI’s exclusion of non-Treasury personnel in key situations, 

TFI and other agencies differ. State and Justice officials cited several 

examples of situations they believe undermined U.S. effectiveness at 

combating illicit financing networks. For example, according to State 

officials, a State official who has taken the necessary training has not been 

allowed to participate as a member of the U.S. team conducting FATF 

mutual evaluations. According to these officials, this results in the 

exclusion of senior staff with significant experience and expertise that 

could benefit the evaluation teams. In response, TFFC officials indicated 

that they have included other agencies in the mutual evaluation process. 

For example, they indicated that officials from Justice and other agencies 

participated in at least six mutual evaluations from 2004 through 2009. 

According to TFI, it encourages and attempts to facilitate such 

participation by other agency officials who have attended the necessary 1-

week training course and whose agencies will pay for their travel to 

foreign countries to conduct and defend their evaluations. 

 

20According to TFFC officials, in addition to State and Justice, participating agencies 

include the Department of Homeland Security and the Securities and Exchange 

Commission. 

Page 14 GAO-09-794 Combating Illicit Financing
 

Additionally, Justice officials stated that when TFI allows other agencies 

to review and comment on U.S. policy proposals related to anti-money 

laundering and counterterrorist financing, it consistently provides too little 

time for review. Specifically, Justice officials told us that TFI regularly 

provides agencies 24 hours to review and provide comments on policy 

proposals, which may make it impossible for agencies to conduct an 

appropriate review and effectively excludes them from the process. 

According to TFI officials, they distribute materials as soon as possible; 

for FATF materials this occurs within 24 hours of receiving them, though 

they acknowledge that they often are provided short deadlines by the 

FATF Secretariat. According to TFI officials, they sometimes request an 

extension of the deadline or submit the U.S. response late in order to 

obtain interagency views. 

With regard to concerns about TFI’s unilateral decision making, TFI and 

other agencies also differed. State and Justice officials cited a situation 

related to the U.S. position on how to treat the European Union (as a 

single entity or as separate countries) for the purposes of cash-smuggling 

regulations. According to State and Justice officials, during interagency 

meetings prior to the FATF working group session at which the issue was 

to be discussed, a consensus U.S. position was developed. However, State 

and Justice officials said that at the FATF plenary meetings, Treasury 

officials advocated a position that was different from the consensus U.S. 

position agreed to in advance of the meeting. A Treasury official told us 

that the agency did not deviate from the consensus position agreed to 

before the meeting. 

Justice, State, and Treasury officials said that there is no guidance 

specifying how the interagency process should operate to develop U.S. 

positions in advance of FATF meetings. Specifically, there is no guidance 

regarding the process or time frames for circulating or approving U.S. 

policy statements to be made at international meetings to discuss antimoney laundering and counterterrorist financing issues. In addition, there 

is no formal mechanism for monitoring, evaluating, or reporting on the 

results of agencies’ collaborative efforts. 

According to State and Justice officials, the inconsistent quality of 

interagency collaboration may undermine some efforts to combat illicit 

financing networks through international forums. State officials suggested 

that the exclusion of non-Treasury personnel may mean that expertise 

available within the U.S. government is not effectively utilized, thus 

potentially weakening the United States’ ability to influence international 

partners’ actions. In addition, they suggested that unilateral action by 

Page 15 GAO-09-794 Combating Illicit Financing
 

Treasury in international forums may cause confusion among international 

partners regarding the nature of the U.S. position on key issues. On the 

basis of comments they received from foreign officials, Justice and State 

officials concluded that such confusion might weaken the United States’ 

ability to influence the activities of international partners. TFFC 

responded that it has not observed any confusion among its international 

partners in FATF regarding the U.S. position on key issues. 

Justice and State officials did not raise similar concerns concerning 

FinCEN’s collaboration when participating with them on issues related to 

the Egmont Group. In contrast, Justice officials expressed some criticisms 

of more recent collaboration with OFAC on issues such as information 

sharing. OFAC responded that it has regular contact with Justice with 

respect to enforcement matters and that the two agencies have an ongoing 

dialogue regarding information sharing. OFAC also noted that only a small 

subset of its enforcement cases involve the type of knowing conduct that 

is appropriate for referral to criminal authorities. 

While TFI has conducted strategic planning activities at different levels 

within the organization, TFI as a unit has not fully adopted certain key 

practices. In particular, TFI has not clearly aligned its resources with its 

priorities. TFI’s strategic planning documents do not consistently integrate 

discussion of the resources needed to achieve TFI’s strategic objectives. In 

addition, TFI’s resource levels for each component cannot be clearly 

linked to its workload. Also, while some TFI components have taken the 

initiative to conduct some workforce planning activities, TFI management 

has not developed a process for conducting comprehensive strategic 

workforce planning. 

TFI Has Not Clearly 

Aligned Its Resources 

with Priorities or 

Performed 

Comprehensive 

Workforce Planning 

TFI Has Not Clearly 

Aligned Its Resources with 

Its Priorities 

Our review of TFI’s and its components’ strategic planning documents and 

discussions with TFI officials showed that TFI has not clearly aligned its 

resources with its priorities. TFI officials indicated that priorities could be 

Page 16 GAO-09-794 Combating Illicit Financing
 

identified in TFI’s strategic plan. TFI identified four relevant strategic 

plans: one for TFI as a whole and one each for FinCEN, OIA, and TEOAF.21

Strategic plans are used to communicate what an organization seeks to 

achieve in the upcoming years, according to Treasury instructions. The 

goals and strategies presented in the plan provide a road map for both the 

organization and its stakeholders. Strategic plans should guide the 

formulation and execution of the budget as well as other decision making 

that shapes and guides the organization. These plans are a tool for setting 

priorities and allocating resources consistent with these priorities, 

according to Treasury. Our previous work has shown that strategic plans 

should clearly link goals and objectives to the resources needed to achieve 

them and are especially important in those cases where agencies submit a 

strategic plan for each of their major components and a strategic overview 

that under the guidance is to show the linkages among these plans.22

Government Performance and Results Act guidance also establishes six 

key elements of successful strategic plans, and Treasury’s instructions 

suggest plan formats.23

However, we found that TFI’s and its components’ strategic plans do not 

consistently integrate discussion of the resources necessary to achieve TFI 

objectives. Specifically, we found that 

 

21In June 2009, the Under Secretary for TFI provided us a copy of a document that he 

characterized as TFI’s strategic plan and said that he used it to manage TFI. However, this 

unsigned, undated document lacked some characteristics typically found in a strategic plan 

(including those of some TFI components) such as an indication of the time period covered 

and the name of the senior official who approved the document. 

22GAO, Managing for Results: Critical Issues for Improving Federal Agencies’ Strategic 

Plans, GAO/GGD-97-180 (Washington, D.C.: Sept. 16, 1997) 

23The six elements are (1) a comprehensive agency mission statement; (2) agencywide longterm goals and objectives for all major functions and operations; (3) approaches (or 

strategies) and the various resources needed to achieve the goals and objectives; (4) a 

description of the relationship between the long-term goals and objectives and the annual 

performance goals; (5) an identification of key factors, external to the agency and beyond 

its control, that could significantly affect the achievement of the strategic goals; and (6) a 

description of how program evaluations were used to establish or revise strategic goals and 

a schedule for future program evaluations. 

Page 17 GAO-09-794 Combating Illicit Financing
 

• FinCEN’s24 and TEOAF’s25 strategic plans contain some discussion of the 

resources needed to achieve their objectives. 

• TFI’s and OIA’s26 strategic plans do not contain discussion of the resources 

needed to achieve their objectives. 

• OFAC and TFFC do not currently have strategic plans. 

While TFI’s strategic plan includes a mission statement; a list of threats, 

goals, and objectives; and means and strategies, it does not include any 

discussion or analysis of TFI’s resource needs. Moreover, TFI’s strategic 

plan lists all four of its goals, and each of its means and strategies under 

each goal as equivalent: it does not indicate any prioritization among its 

various goals, means, and strategies.27

The Under Secretary for TFI said that he uses the annual budget process 

to align resources with priorities. However, two reasons suggest why the 

results of the budget process do not necessarily reflect TFI’s strategic 

priorities. First, there are many other factors that affect the budget 

process that are unrelated to TFI’s priorities. The amount of resources TFI 

seeks is integrated into a larger Treasury budget request, which may entail 

modifying TFI’s request. Congress, then, may choose to provide more or 

less than the amount of resources to TFI that Treasury requested. Second, 

the annual budget process reflects priorities only for a given year, unlike 

strategic plans, which are intended to be multiyear documents and thus 

reflect longer-term priorities. 

 

24Department of the Treasury, Financial Crimes Enforcement Network, Strategic Plan: 

Fiscal Years 2008-2012 (Washington, D.C.: April 2008). 

25Department of the Treasury, Treasury Forfeiture Fund, Strategic Plan, Fiscal Years 

2007-2012 (Washington, D.C.: September 2007). 

26Department of the Treasury, Office of Intelligence and Analysis, Strategic Direction, 

Fiscal Years 2009-2011 (Washington, D.C.: July 2008). 

27Strategic goals in TFI’s strategic plan are to (1) provide expert all-source analysis on 

financial and other networks supporting terrorism, weapons of mass destruction 

proliferation, and other national security threats in order to marshal TFI priorities and 

action; (2) execute the nation’s financial sanctions policies and use other TFI tools and 

authorities to advance U.S. government objectives; (3) lead policy development, 

coordination, and coalition building to counter financial aspects of national security threats 

and pressure obstructionist countries; and (4) enhance the transparency and integrity of 

the financial system, and support law enforcement and financial regulators in fighting 

crime. 

Page 18 GAO-09-794 Combating Illicit Financing
 

Further, the linkage between the resources allocated to each TFI 

component and its workload is unclear. Estimated workload measures for 

each of TFI’s components show a growth in workload since 2005, but it is 

unclear how this growth relates to resource increases. For example, one 

measure of FinCEN’s workload—the number of SARs it must analyze—

has increased 50 percent and the number of employees in FinCEN has 

increased 3 percent.28 In addition, TEOAF has seen an 83 percent increase 

in the value of seized assets it manages and the number of FTEs has grown 

10 percent.29 Further, the number of OFAC licensing actions increased 56 

percent while the number of FTEs grew 18 percent.30 Additionally, OIA 

experienced a more than 500 percent increase in intelligence taskings 

from 2006 to 2008 and has received a 200 percent increase in FTEs.31

Finally, TFFC estimates that its workload related to developing policy 

papers, legislative and rulemaking papers, trips, and public outreach 

events increased between 100 and 200 percent from 2005 to 2009; its FTEs 

grew nearly 80 percent from 2005 to 2008.32

According to TFI officials, their ability to allocate resources to their 

highest priorities is constrained in some circumstances. The Under 

Secretary and other TFI officials identified activities related to Iran and 

North Korea as persistent priorities. However, OFAC officials noted that in 

spite of the importance of Iran- and North Korea-related activities, they 

must expend a significant amount of resources on implementing the Cuba 

embargo. With regard to acting on specific licensing requests for exports 

and travel to Cuba, according to OFAC officials, they have little flexibility 

under the law.33 OFAC is required to process all license applications that it 

 

28From 2005 to 2008, the number of SARs grew from approximately 900,000 to 1.3 million 

and the number of employees grew from 291 to 299. 

29From 2005 to 2008, the value of seized assets grew from $304 million to $557 million and 

the number of FTEs grew from 20 to 22. 

30From 2005 to 2008, the number of license actions grew from approximately 40,000 to 

approximately 63,000 and the number of FTEs grew from 132 to 155.5. 

31OIA’s staff grew from 45 FTEs in 2005 to 135 FTEs in 2008. We are not reporting the 

specific number of intelligence taskings, as this information is for official use only. 

32TFFC’s staff grew from 19 FTEs in 2005 to 34 FTEs in 2008. 

33Treasury administers the Cuban Assets Control Regulations, 31 CFR Part 515, which 

includes provisions on obtaining licenses to engage in certain otherwise prohibited 

activities. These regulations were recently amended. See 74 Fed. Reg. 46000. Recent 

changes include the authorization of family travel under a general license rather than a 

specific license. It is unclear at this time what impact these changes will have on OFAC’s 

resources. 

Page 19 GAO-09-794 Combating Illicit Financing
 

receives. For 2005 through 2008, this amounted to more than 200,000 

licensing actions—more than 95 percent of which related to the Cuba 

program. In 2008 alone, OFAC responded to nearly 60,000 licensing 

requests related to the Cuba travel program. OFAC officials characterized 

this situation as a resource burden. 

In contrast, according to OFAC officials, they have some flexibility 

regarding how they enforce the Cuba sanctions program, for example, 

through the assessment of civil penalties for violations. According to 

OFAC officials, for many years (through 2005), OFAC assessed a large 

number of civil penalties related to the Cuba travel regulations. As 

violations of these regulations have a relatively small financial penalty 

associated with them, the average penalty amount was relatively low. 

Since 2006, according to OFAC officials, they have consciously utilized the 

flexibility they are allowed in order to dedicate their enforcement 

resources to higher-value areas (e.g., those related to trade with Cuba, 

Iran, and North Korea). As a result, the number of penalties assessed 

annually related to the Cuba sanctions program has dropped significantly, 

from 498 in 2005 to 46 in 2008. At the same time, the average value of 

OFAC’s civil penalties for violations of all sanctions programs has 

increased significantly, from approximately $2,400 in 2005 to nearly 

$31,000 in 2008. 

TFI Has Not Taken a 

Comprehensive Approach 

to Strategic Workforce 

Planning 

Despite efforts by some components, TFI management has not yet 

conducted comprehensive activities to address the key principles of 

strategic workforce planning. According to the Under Secretary, TFI’s 

workforce is its greatest asset, and ensuring that it is the right size and 

includes the right skills is critical to TFI’s future ability to achieve its 

mission. Prior GAO work has identified key principles to assist agencies in 

conducting strategic workforce planning.34 Among these principles are (1) 

involving top management, employees, and other stakeholders in 

developing, communicating, and implementing the strategic workforce 

plan, and (2) monitoring and evaluating the agency’s progress toward its 

 

34GAO, Human Capital: Key Principles for Effective Strategic Workforce Planning, 

GAO-04-39 (Washington, D.C.: Dec. 11, 2003). 

Page 20 GAO-09-794 Combating Illicit Financing
 

human capital goals and the contribution that human capital results have 

made toward achieving programmatic results.35

According to TFI officials, some TFI components have taken the initiative 

individually to perform some strategic workforce planning activities. 

Specifically, as a Treasury bureau, FinCEN has an internal human 

resources group that, among other things, performs some strategic 

workforce planning activities. For example, according to FinCEN officials, 

they undertook an effort to identify mission critical occupations, which 

resulted in designating three positions as mission critical. As a result, 

FinCEN developed plans to address human capital challenges related to 

these occupations and regularly reports to Treasury’s Office of the Deputy 

Assistant Secretary for Human Resources and Chief Human Capital Officer 

on its progress. In addition, OIA has taken a variety of steps to address 

human capital challenges. For example, according to OIA officials, to 

address challenges in recruiting and retaining intelligence analysts, OIA 

cataloged the human capital flexibilities available to provide recruiting and 

retention incentives. As a result, OIA officials indicated that they have 

identified and are now able to utilize a variety of human capital 

flexibilities, such as student loan repayment to attract and retain staff and 

the Pat Roberts Intelligence Scholarship Program to pay for the continuing 

educational needs of its analysts. 

Nonetheless, TFI management has not yet conducted comprehensive 

activities to address the key principles of strategic workforce planning for 

TFI as a whole. TFI top management has not set the overall direction and 

goals of workforce planning or evaluated progress toward any human 

capital goals. The Under Secretary for TFI told us that since the creation of 

TFI, growing OIA’s human capital has been one workforce planning 

priority. He also stated that he has conducted additional targeted 

workforce planning in consultation with the heads of the largest TFI 

components, such as FinCEN. However, neither TFI officials nor Treasury 

human capital officials were aware of any explicit workforce planning 

goals set by TFI management. In addition, TFI officials were unaware of 

 

35Other principles are to (1) determine the critical skills and competencies that will be 

needed to achieve current and future programmatic results; (2) develop strategies that are 

tailored to address gaps in number, deployment, and alignment of human capital 

approaches for enabling and sustaining the contributions of all critical skills and 

competencies; and (3) build the capability needed to address administrative, educational, 

and other requirements important to supporting workforce strategies. 

Page 21 GAO-09-794 Combating Illicit Financing
 

any formal reviews or reports that evaluated the contribution of human 

capital results to achieving programmatic goals. 

Moreover, TFI currently lacks an effective process for conducting 

comprehensive strategic workforce planning. According to the Under 

Secretary for TFI, most workforce planning takes place as a part of the 

annual budget process. TFI has not established a separate, comprehensive 

strategic workforce planning process led by TFI management. According 

to an official from Treasury’s Office of the Deputy Assistant Secretary for 

Human Resources and Chief Human Capital Officer, the office has 

provided targeted workforce planning assistance to OIA and, in spring 

2009, began discussing how they could assist TFI in broader workforce 

planning efforts. In particular, they cited the need to conduct an overall 

workforce analysis and succession planning. 

According to TFI’s Senior Resource Manager, TFI’s workforce planning 

mainly occurs as a component of the annual budget preparation process. 

As a part of this process, individual components can request additional 

staff resources for priority initiatives they identify. TFI management then 

evaluates these individual proposals and determines what will be included 

in TFI’s budget request. 

Without the benefit of comprehensive strategic workforce planning to 

assist in identifying solutions, it is unclear whether TFI will be able to 

effectively address persistent workforce challenges. These include the 

following: 

• Lack of comprehensive training needs assessment. While some TFI 

components have assessed the training needs of their staff, there has been 

no similar TFI-wide effort. Without such an assessment, it is unclear 

whether TFI staff are being prepared to address the challenges posed by 

illicit financing in the future. 

• Obstacles to hiring intelligence analysts. According to officials from OIA 

and Treasury’s Office of the Deputy Assistant Secretary for Human 

Resources and Chief Human Capital Officer, OIA continues to be at a 

competitive disadvantage relative to other agencies in the Intelligence 

Community regarding recruiting. Specifically, according to Treasury 

officials, most other agencies in the Intelligence Community can hire 

intelligence analysts into the excepted service, thus bypassing the need for 

competitive selection of candidates. In addition, OIA lacks direct hire 

authority for its intelligence analysts. According to OIA officials, these 

Page 22 GAO-09-794 Combating Illicit Financing
 

challenges make OIA’s hiring process more complicated and lengthier than 

those of other agencies in the Intelligence Community. 

TFI has not yet developed an appropriate set of performance measures, 

but continues to attempt to improve its efforts. Since TFI was formed, its 

individual performance measures have varied substantially in number and 

the extent to which they address attributes of successful performance 

measures that GAO has identified. For fiscal year 2008, the performance 

measures of TFI’s components vary in the extent to which they address 

attributes of successful performance measures identified by GAO. TFI’s 

performance measures address many, but not all, of these attributes. 

According to Treasury officials, TFI recognizes the need to improve its 

performance measures, and is developing a new set of measures to assess 

its performance. However, our review of a draft version of these revised 

measures suggests that some concerns would remain if they are 

implemented as proposed. 

TFI Has Not Yet 

Developed an 

Appropriate Set of 

Performance 

Measures, but 

Continues to Work to 

Improve Its Efforts 

Performance Measures 

Related to TFI Functions 

Have Varied over the Years 

As shown in figure 4, since its formation in 2004, TFI’s performance 

measures have varied over time. TFI reported on 11 total measures in 

fiscal year 2005, 9 measures in fiscal year 2006, 10 measures in fiscal year 

2007, and 20 measures in fiscal year 2008. The number and content of 

performance measures have varied within components over time, as well. 

For example, FinCEN had 6 measures in fiscal year 2007 and 16 in fiscal 

year 2008. Components have frequently introduced new measures only to 

discontinue them in subsequent years. For instance, OFAC reported 4 

measures in fiscal year 2005, and then discontinued 3 for fiscal year 2006. 

OIA, newly formed in 2004, reported 1 performance measure in fiscal year 

2006 and none the following years.36 The extent of inconsistency in TFI’s 

performance measures creates challenges for managers to using 

performance data in making management decisions. 

 

36According to TFI, since 2007 OIA has tracked its timeliness, relevance, and accuracy to 

measure its performance and has reported on these measures to the Office of the Director 

of National Intelligence each year. These data were not included in Treasury’s performance 

and accountability reports. 

Page 23 GAO-09-794 Combating Illicit Financing
 

Figure 4: Changes in TFI Performance Measures, Fiscal Years 2005 to 2008 

Number of measures

Fiscal year

Source: GAO analysis of Treasury performance and accountability reports, fiscal years 2005-2008.

New measure

Existing measure

Discontinued measure

0

2

4

6

8

10

12

2005 2006 2007 2008

According to TFI officials, the sharp increase in the number of 

performance measures reported in fiscal year 2008 was a response to the 

evaluation and recommendations of the Office of Management and 

Budget’s (OMB) Program Assessment Rating Tool (PART) in 2005 and 

2006.37 The PART process identified potential enhancements to FinCEN’s 

performance measures, leading to the inclusion of new measures for 

FinCEN.38 FinCEN officials said that Treasury performance officials asked 

that the newly developed measures be added to FinCEN’s contribution to 

 

37PART was used to assess and improve federal program performance. PART encouraged 

the development of performance measures that are outcome-oriented, relate to the overall 

purpose of the program, and have ambitious targets. All programs receiving PART 

assessments also developed improvement plans that should be ambitious, include actions 

with completion dates, and be designed to improve program results. 

38OFAC’s Economic and Trade Sanctions Program was also evaluated by PART, in 2002. It 

was recommended that OFAC develop long-term performance goals with specific time 

frames and measures. 

Page 24 GAO-09-794 Combating Illicit Financing
 

the fiscal year 2008 performance and accountability report. According to 

officials in Treasury’s Office of Strategic Planning and Performance 

Management (OSPPM), the nature of FinCEN’s work is operational, 

making it easier to evaluate the bureau’s performance. TFI’s policy-making 

components, such as TFFC, have found it more difficult to develop 

meaningful performance metrics. 

TFI’s Current Performance 

Measures Exhibit Many, 

but Not All, Attributes of 

Successful Performance 

Measures 

The performance measures TFI currently has in place also vary in the 

degree to which they exhibit the attributes of successful performance 

measures. Prior GAO work has identified nine attributes of successful 

performance measures.39 Table 1 shows the nine attributes, their definitions, 

and the potentially adverse consequences of not having the attribute. 

Table 1: GAO’s Key Attributes of Successful Performance Measures 

Attribute Definition 

Potentially adverse consequences of not 

having attribute 

Linkage Measure is aligned with division and agencywide goals 

and mission and clearly communicated throughout the 

organization. 

Behaviors and incentives created by 

measures do not support achieving division or 

agencywide goals or mission. 

Clarity Measure is clearly stated and the name and definition 

are consistent with the methodology used to calculate 

it. 

Data could be confusing and misleading to 

users. 

Measurable target Measure has a numerical goal. Cannot tell whether performance is meeting 

expectations. 

Objectivity Measure is reasonably free from significant bias or 

manipulation. 

Performance assessments may be 

systematically over- or understated. 

Reliability Measure produces the same result under similar 

conditions. 

Reported performance data are inconsistent 

and add uncertainty. 

Core program activities Measures cover the activities that an entity is expected 

to perform to support the intent of the program. 

Not enough information available in core 

program areas to managers and stakeholders.

Limited overlap Measure should provide new information beyond that 

provided by other measures. 

Manager may have to sort through redundant, 

costly information that does not add value. 

Balance Balance exists when a suite of measures ensures that 

an organization’s various priorities are covered. 

Lack of balance could create skewed 

incentives when measures overemphasize 

some goals. 

Governmentwide 

priorities 

Each measure should cover a priority such as quality, 

timeliness, or cost of service. 

A program’s overall success is at risk if all 

priorities are not addressed. 

Source: GAO-03-143. 

 

39GAO, Tax Administration: IRS Needs to Further Refine Its Tax Filing Season 

Performance Measures, GAO-03-143 (Washington, D.C.: Nov. 22, 2002). 

Page 25 GAO-09-794 Combating Illicit Financing
 

TFI’s performance measures address many of these attributes of 

successful performance measures, but do not fully address other 

attributes. Figure 5 represents our assessment of TFI’s 20 performance 

measures versus the key attributes of successful performance measures. 

Figure 5: TFI’s Fiscal Year 2008 Performance Measures Relative to the Key 

Attributes of Successful Performance Measures 

Attributes of successful performance measures

Number of performance measures

Number of measures not exhibiting the attribute

Number of measures exhibiting the attribute

Source: GAO analysis of Treasury performance and accountability reports, fiscal years 2005-2008.

0246 8 10 12 14 16 18 20

Governmentwide priorities

Limited

overlap

Core program

activities

Reliability

Objectivity

Measurable

target

Clarity

Linkage

According to our analysis, TFI’s 20 measures have many of the attributes 

of successful performance measures, including the following. 

• Measurable target. All 20 of TFI’s measures have measurable, numerical 

targets in place. Numerical targets allow officials to more easily assess 

whether goals and objectives were achieved because comparisons can be 

made between projected performance and actual results. 

Page 26 GAO-09-794 Combating Illicit Financing
 

• Limited overlap. We found limited overlap among TFI’s 20 measures, that 

is, little or no unnecessary or duplicate information provided by the 

measures. 

• Objectivity. We found all of TFI’s measures to be objective, or reasonably 

free from significant bias. 

• Governmentwide priorities. We also determined that TFI’s 20 measures 

are linked to broader priorities such as cost-effectiveness, quality, and 

timeliness. 

However, the measures did not fully satisfy the following attributes. 

• Linkage. Six TFI measures are not clearly linked to Treasury goals. For 

example, TEOAF measures the proportion of its forfeitures that come 

from high-impact cases. However, it is unclear why high-impact cases in 

particular are measured as opposed to all cases. Our analysis could not 

link TEOAF’s measure to broader agencywide goals related to removing or 

reducing threats to national security. 

• Core program activities. Seven TFI measures do not sufficiently cover 

core program activities. For example, OFAC has three main 

responsibilities related to the administration of sanctions: (1) issuing 

licenses, (2) designation programs, and (3) enforcement through civil 

penalties. However, OFAC’s one performance measure only assesses cases 

involving civil penalties resulting from sanctions violations. 

• Balance. We found that TFI’s set of performance measures is not 

balanced. In fiscal year 2008, TFI reported on 20 measures, 16 of which 

related to FinCEN’s programs and activities, 1 that related to OFAC, 1 that 

related to TEOAF, 2 that related to TFFC, and none that related to OIA. As 

a result, a disproportionate number of measures (16) relate to 

administering and enforcing the BSA and none to the analysis of financial 

intelligence. An emphasis on one priority at the expense of others may 

skew the overall performance and preclude TFI’s managers from 

understanding the effectiveness of their programs in supporting Treasury’s 

overall mission and goals. In addition, the lack of balance exhibited by 

TFI’s measures may give the impression that administering the BSA is 

prioritized over other functions, such as the analysis of financial 

intelligence or administration of licensing and designations programs. 

Page 27 GAO-09-794 Combating Illicit Financing
 

Treasury officials acknowledge the limits of TFI’s current performance 

measurement and have been working to enhance its measures, by 

replacing them with a single new TFI-wide measure. According to OSPPM 

officials, they began an initiative to overhaul TFI’s performance 

measurement in 2007. OSPPM officials stated that TFI’s performance 

measures did not effectively reflect the impact of TFI’s activities. After 

consultation with each TFI component, OSPPM decided to design a new 

composite measure that will provide a way to assess how TFI is 

performing overall as a unit. The new measure would outline the roles and 

functions of TFI’s components and evaluate the outcomes of their 

activities. However, the process of reforming TFI’s performance 

measurement has not been completed. The implementation of the new 

measure is still uncertain, although TFI management approved its use in 

May 2009 and components finalized the measures they will contribute.40

TFI Is Working to Replace 

Its Performance Measures, 

but Some Concerns 

Remain 

According to a Treasury official, OSPPM decided on the format of the new 

composite measure after researching other federal agencies’ approaches 

to performance measurement, as well as those of management 

consultancies in the private sector. The composite measure takes a similar 

form to the measure implemented for Treasury’s Office of Technical 

Assistance (OTA), first reported in Treasury’s fiscal year 2008 performance 

and accountability report.41 The measure aims to provide a more 

comprehensive snapshot of the outcome of OTA’s activities by measuring 

impact and traction.42

The composite measure for TFI will align the two Treasury outcomes that 

relate to their activities with TFI’s performance goals and focus areas, 

according to Treasury.43 Each focus area corresponds with a TFI 

 

40After approval from the appropriate Treasury management, the measure will be sent to 

OMB for its endorsement. OSPPM managers told us that OMB has seen a draft of the 

composite measure and been informed of the overall approach. 

41Department of the Treasury, Fiscal Year 2008 Performance and Accountability Report 

(Washington, D.C.: Nov. 17, 2008). 

42According to Treasury officials, “impact” refers to whether or not the policy initiative had 

a positive outcome. “Traction” refers to how efficiently and effectively the policy office 

works with partners or the extent to which the policy office influences progress toward an 

outcome. 

43The Treasury outcomes for TFI are (1) removed or reduced threats to national security 

from terrorism, proliferation of WMD, drug trafficking and other criminal activity on the 

part of rogue regimes, individuals, and their support networks, and (2) safer and more 

transparent U.S. and international financial systems. 

Page 28 GAO-09-794 Combating Illicit Financing
 

component (OFAC, OIA, TFFC, and FinCEN). The components will track 3 

to 6 performance measures and will assign a numeric score to the 

performance at the end of the year. Each component’s measures will be 

combined to reach an overall score for the component. In the end, an 

overall score for TFI will be determined by averaging the individual scores 

of the components. 

All TFI components except TEOAF have been involved in the process of 

developing the composite measure. Both OSPPM and TEOAF officials 

stated that TEOAF would not be included, since its work did not logically 

fit in one of the focus areas. OIA, TFFC, and OFAC have developed new 

measures to assess the impact of their activities. FinCEN will use 5 of its 

existing measures for its contribution to the composite measure. 

TFI faces significant challenges in developing and implementing the new 

composite measure. There is an inherent difficulty in creating quantitative 

measures for policy organizations, whose activities may not be easily 

represented with numbers. Many TFI managers pointed to the difficulty of 

making qualitative information measurable for performance reporting. 

While the initiative to improve TFI’s performance measurement is a 

positive step, our preliminary analysis raises concerns regarding the extent 

to which the new TFI composite measure will allow full and accurate 

assessment of TFI’s performance. For example, we identified the following 

concerns: 

• Objectivity and reliability of survey-based measures. OIA has developed 

surveys to measure the timeliness, relevance, and accuracy of its 

intelligence support, all-source analysis, and security and 

counterintelligence. The survey respondents are internal customers of 

OIA’s products within Treasury such as the Deputy Secretary, Under 

Secretaries, Assistant Secretaries, Deputy Assistant Secretaries, and senior 

staff. The objectivity of the surveys is not clear given that respondents’ 

answers may be biased because they have a vested interest in the 

outcome, as it is a reflection on their performance. The reliability of the 

measures is also questionable, as only between 7 and 13 internal 

customers—rather than external customers in the Intelligence 

Community—will be asked to complete the survey. TFI believes that while 

there is no perfect method for evaluating OIA’s performance, the surveys 

are an effective means for Treasury policymakers to assess OIA’s 

performance. They also noted their plan to survey customers in other parts 

of the Intelligence Community in 2010. 

Page 29 GAO-09-794 Combating Illicit Financing
 

• Lack of validation for some components’ self-assessment-based 

measures. Some components’ performance measures rely exclusively on 

self-assessments by component managers and lack external verification. 

For example, TFFC has 4 measures for which management will compile 

supporting information and assign a high, medium, or low rating for 

TFFC’s performance in that area. Treasury and TFI acknowledge (but have 

not yet addressed) a lack of a process to independently verify TFFC’s selfassessment. OTA’s composite measure, which OSPPM officials cited as 

similar to TFI’s, also uses elements of self-assessment, but those results 

are independently validated by an external source and reviewed by 

Treasury. 

• Calculation of overall TFI score. According to TFI, to calculate the 

composite measure, individual components’ results will be averaged into a 

single TFI measure. Since the components are not all contributing the 

same number of measures to the overall composite measure, averaging 

components’ scores means components’ individual performance measures 

are not weighted equally in TFI’s overall measure. 

Since its creation in 2004, TFI has undertaken a variety of activities to 

address a broad range of national security threats, such as enhancing the 

use of financial intelligence against terrorism and the proliferation of 

weapons of mass destruction. In addition, TFI and its components have 

taken some steps toward more effective management of TFI as an 

organization. For instance, TFI and some components have developed 

strategic plans and have performed workforce planning activities. 

Conclusions 

Nonetheless, TFI has not fully utilized some management tools to create 

an integrated organization with a consistent, well-documented approach to 

planning and managing its operations. As a result, additional opportunities 

for improvement exist. First, despite the critical role interagency 

collaboration plays in many of TFI’s functions and general approval by key 

interagency partners, such collaboration may not be as effective as it could 

be in certain respects. TFI and some of its interagency partners had 

strikingly different perceptions about the quality of collaborative efforts 

involving multilateral forums. Lacking clearly documented policies and 

procedures for collaboration in this area, interagency partners were 

unsure how to resolve their differences. Without a mechanism to monitor 

and report on the results of such interagency collaboration, TFI officials 

were generally unaware that differences existed or what impact they might 

be having, and thus saw no need to take steps to understand or address 

them. Second, TFI management has not clearly aligned its resources with 

Page 30 GAO-09-794 Combating Illicit Financing
 

its priorities. Without clear, consistent objectives and an understanding of 

how resources are aligned with them, it may be unclear to Congress, TFI’s 

interagency partners, or even TFI staff what TFI’s priorities are and 

whether TFI has sufficient resources to address them. In addition, while 

some components have undertaken workforce planning activities, TFI 

management has yet to implement a comprehensive strategic workforce 

planning process for TFI as a whole. As a result, TFI may be at risk of not 

having the workforce required to address future national security threats. 

Finally, TFI’s performance reporting has been uneven. Though TFI has 

been working to improve its ability to effectively measure its performance 

as a unit, TFI has not yet developed a set of performance measures that 

embody the attributes of successful performance measures. Without a set 

of effective performance measures, it is difficult to judge how well TFI is 

achieving its mission. 

To help strengthen Treasury’s ability to achieve its strategic goal of 

preventing terrorism and promoting the nation’s security through 

strengthened international financial systems, we recommend that the 

Secretary of the Treasury direct the Under Secretary for Terrorism and 

Financial Intelligence to take the following four actions: 

1. develop and implement, in consultation with interagency partners 

participating in international forums related to anti-money laundering 

and counterterrorist financing issues, (a) compatible policies, 

procedures, and other means to operate across agency boundaries and 

(b) a mechanism for monitoring, evaluating, and reporting on 

interagency collaboration; 

2. develop and implement policies and procedures for aligning resources 

with TFI’s strategic priorities; 

3. develop and implement a TFI-wide process, including written 

guidance, that addresses the key principles of strategic workforce 

planning; and 

4. ensure that TFI’s performance measures exhibit the key attributes of 

successful performance measures. 

We provided a draft copy of this report to the Departments of the 

Treasury, State, and Justice. Justice and State declined to provide 

comments. Treasury provided comments, which are reprinted in appendix 

IV. 

Recommendations for 

Executive Action 

Agency Comments 

and Our Evaluation 

Page 31 GAO-09-794 Combating Illicit Financing
 

Treasury’s comments highlighted what it views as TFI’s significant 

contributions since 2005. Treasury said that TFI has helped reduce the 

threat of terrorist financing, stating that al Qaeda is in its worst financial 

position in at least 3 years. In addition, Treasury highlighted TFI’s efforts 

to counter the financing of proliferation, for example, using Executive 

Order 13382 to isolate banks, companies, and individuals tied to North 

Korean, Iranian, and Syrian proliferation. 

Treasury’s comments also discussed ongoing or planned actions related to 

our four recommendations: 

• With regard to our recommendation that TFI develop and 

implement policies and procedures to operate across agency 

boundaries and develop a mechanism for monitoring, evaluating, 

and reporting on interagency collaboration, the Under Secretary 

for Terrorism and Financial Intelligence indicated that his 

counterparts in other agencies have never expressed concerns 

about process or substance to him regarding TFI’s collaboration. 

Nonetheless, Treasury stated that it would redouble its efforts to 

coordinate with other agencies, but did not identify specific steps it 

plans to take. As discussed in our report, we recommend that such 

steps include developing clear policies for conducting and 

monitoring the results of interagency collaboration. 

• In response to our recommendation to develop and implement 

policies and procedures for aligning resources with TFI’s strategic 

priorities, Treasury indicated that TFI is working to improve its 

processes in this area. While Treasury stated that its use of the 

annual budget process has worked well to match resources to 

strategic goals, we have concluded that the annual budget process 

does not necessarily reflect TFI’s strategic priorities, in part 

because it reflects priorities for only a given year and not longerterm priorities. 

• In relation to our recommendation to develop and implement a 

TFI-wide process to address the key principles of strategic 

workforce planning, Treasury commented that it is working with 

Johns Hopkins University’s Capstone Consulting to develop a 

workforce planning model for Treasury. As a part of this effort, 

TFI plans to develop and disseminate written guidance establishing 

a process to align resources with TFI and Treasury strategic goals 

in the next 12 months. 

Page 32 GAO-09-794 Combating Illicit Financing
 

• Finally, Treasury stated that it will work to implement our 

recommendation to ensure that TFI’s performance measures 

exhibit the key attributes of successful performance measures. At 

the same time, Treasury contends that TFI’s true performance will 

often be best conveyed through briefings to those who possess the 

appropriate security clearances. To ensure that such briefings 

provide systematic evidence regarding TFI’s performance, they 

should include assessments based on performance measures that 

exhibit the key attributes of successful performance measures 

discussed in this report. Further, we would note that using 

classified information to help assess TFI’s performance does not 

preclude TFI from developing unclassified performance measures 

or from producing an unclassified assessment of its performance. 

In fact, Treasury’s statements about the financial condition of al 

Qaeda referenced in its response to this report provide Treasury’s 

assessment of TFI’s impact on al Qaeda without disclosing 

classified information. 

As agreed with your office, unless you publicly announce the contents of 

this report earlier, we plan no further distribution until 30 days from the 

report date. At that time, we will send copies of this report to the 

appropriate congressional committees as well as the Secretaries of the 

Treasury, State, and Justice. We will make copies available to others upon 

request. In addition, the report will be available at no charge on the GAO 

Web site at http://www.gao.gov. 

If you or your staff has any questions about this report, please contact me 

at (202) 512-4347 or YagerL@gao.gov. GAO staff who contributed to this 

report are included in appendix V. 

Sincerely yours, 

Loren Yager 

Director, International Affairs and Trade 

Page 33 GAO-09-794 Combating Illicit Financing
Appendix I: Scope and Methodology Appendix I: Scope and Methodology 

To analyze the Office of Terrorism and Financial Intelligence’s (TFI) use of 

its tools to address national security threats, we reviewed Treasury reports 

and documents related to its efforts since 2004. For example, we reviewed 

all of Treasury’s performance and accountability reports and FinCEN’s 

annual reports since TFI was formed. We also reviewed other documents 

discussing activities involving TFI, including the National Money 

Laundering Strategy and the National Strategy for Combating 

Terrorism. To identify practices for enhancing interagency collaboration, 

we reviewed prior GAO reports. We then interviewed officials from 

Treasury and its key interagency partners (the Departments of State and 

Justice) to understand TFI’s processes for interagency collaboration. 

To analyze TFI’s efforts to conduct strategic resource planning, we 

reviewed a variety of Treasury documents. To identify TFI’s priorities, we 

reviewed documents such as Treasury’s performance and accountability 

reports, congressional testimony by the Under Secretary for Terrorism and 

Financial Intelligence, and TFI’s Web site. In addition, we reviewed 

documentation from TFI and its components related to strategic planning, 

including the current strategic plans for TFI and each component. Further, 

we reviewed TFI data regarding the number of staff (full-time equivalents 

or FTE) in each TFI component for fiscal years 2005 through 2008. We 

then obtained data from TFI components to illustrate how their workload 

has changed over time. We determined that these data are sufficiently 

reliable for the purpose of this report. Additionally, we reviewed prior 

GAO work related to principles of effective strategic workforce planning.1

To determine the extent to which TFI’s practices reflect these principles, 

we interviewed TFI management, including the Under Secretary for 

Terrorism and Financial Intelligence and managers from TFI components. 

Further, we interviewed officials from Treasury’s Office of the Deputy 

Assistant Secretary for Human Resources and Chief Human Capital 

Officer. 

To analyze the extent to which TFI’s performance measures provide an 

effective assessment of TFI’s performance, we reviewed Treasury’s 

reporting on TFI’s performance. Specifically, we analyzed the performance 

measures contained in Treasury’s performance and accountability reports 

for fiscal years 2005 through 2008. We also evaluated TFI’s performance 

measures for fiscal year 2008 against key attributes of successful 

performance measures. To perform this evaluation, two analysts 

 

1

GAO-04-39. 

Page 34 GAO-09-794 Combating Illicit Financing 
Appendix I: Scope and Methodology 

independently assessed each of the performance measures against the 

nine attributes identified in the specifications for each attribute included 

in that report.2

 Those analysts then met to discuss and resolve any 

differences in the results of their analyses. A supervisor then reviewed and 

approved the final results of the analysis. To obtain information on TFI’s 

process to improve its set of performance measures, we interviewed 

officials from each TFI component and Treasury’s Office of Strategic 

Planning and Performance Management. We also obtained a copy of draft 

TFI performance measures that will be presented to the Office of 

Management and Budget for its review. We then interviewed officials from 

each TFI component and Treasury’s Office of Strategic Planning and 

Performance Management regarding how the data for these draft 

performance measures would be obtained and how the overall TFI 

composite measure would be developed. 

We also present data on TFI staffing and budget for fiscal years 2005 

through 2008. As these data are presented for background purposes, we 

did not assess their reliability. 

 

2

GAO-03-143. 

Page 35 GAO-09-794 Combating Illicit Financing
Appendix II: Current U.S. Sanctions Programs Appendix II: Current U.S. Sanctions 

Programs 

Office of Foreign Assets Control country-based sanctions programs 

Burma 

Cuba 

Iran 

Sudan 

Source: Department of the Treasury. 

Office of Foreign Assets Control list-based sanctions programs 

Anti-Terrorism 

Belarus 

Burma 

Cote d’Ivoire 

Counter Narcotics Trafficking 

Darfur 

Democratic Republic of Congo 

Iraq 

Lebanon 

Liberia (former regime of Charles Taylor) 

Non-proliferation 

Syria 

Western Balkans 

Zimbabwe 

Source: Department of the Treasury. 

Other Office of Foreign Assets Control sanctions programs 

Highly enriched Uranium 

North Korea 

Rough Diamonds 

Source: Department of the Treasury. 

Page 36 GAO-09-794 Combating Illicit Financing 
Appendix III: GAO Assessment of TFI’s Fiscal 

Year 2008 Performance Measures 

Table 3: GAO Assessment of TFI’s Fiscal Year 2008 Performance Measures 

TFI performance 

measures Component Linkage Clarity 

Measurable 

target Objectivity Reliability 

Core 

program 

activities 

Limited 

overlap 

Governmentwide priorities

Number of open civil 

penalty cases that 

are resolved within 

the statute of 

limitations period 

Office of 

Foreign 

Assets Control 

(OFAC) 

Yes Yes Yes Yes Yes No Yes Yes 

Increase in the 

number of outreach 

engagements with 

the charitable and 

international financial 

communities 

Office of 

Terrorist 

Financing and 

Financial 

Crimes (TFFC)

Yes Yes Yes Yes No Yes Yes Yes 

Number of countries 

that are assessed for 

compliance with the 

Financial Action 

Task Force (FATF) 

recommendations 

TFFC Yes Yes Yes Yes Yes Yes Yes Yes 

Percentage of 

forfeited cash 

proceeds resulting 

from high-impact 

cases 

Treasury 

Executive 

Office for 

Asset 

Forfeiture 

(TEOAF) 

No No Yes Yes Yes No Yes Yes 

Average time to 

process enforcement 

matters (in years) 

Financial 

Crimes 

Enforcement 

Network 

(FinCEN) 

Yes Yes Yes Yes Yes Yes Yes Yes 

Percentage of bank 

examinations 

conducted by the 

federal banking 

agencies indicating a 

systemic failure of 

the anti-moneylaundering program 

rule 

FinCEN Yes No Yes Yes Yes No Yes Yes 

Percentage of 

FinCEN’s Regulatory 

Resource Center 

customers rating the 

guidance received 

as understandable 

FinCEN Yes Yes Yes Yes Yes Yes Yes Yes 

Appendix III: GAO Assessment of TFI’s Fiscal 

Year 2008 Performance Measures 

Page 37 GAO-09-794 Combating Illicit Financing
Appendix III: GAO Assessment of TFI’s Fiscal 

Year 2008 Performance Measures 

TFI performance 

measures Component Linkage Clarity 

Measurable 

target Objectivity Reliability 

Core 

program 

activities 

Limited 

overlap 

Governmentwide priorities

Median time taken 

from date of receipt 

of Financial 

Institution Hotline Tip 

Suspicious Activity 

Report (SAR) to 

transmittal of a 

written analytical 

report to law 

enforcement or the 

intelligence 

community (days) 

FinCEN Yes Yes Yes Yes Yes Yes Yes Yes 

Percentage of 

complex analytical 

work completed by 

FinCEN analysts 

FinCEN Yes Yes Yes Yes Yes Yes Yes Yes 

Percentage of 

countries/ 

jurisdictions 

connected to the 

Egmont Secure Web 

within 1 year of 

Egmont membership 

FinCEN Yes No Yes Yes Yes Yes Yes Yes 

Percentage of 

domestic law 

enforcement and 

foreign financial 

intelligence units 

finding FinCEN’s 

analytical reports 

highly valuable 

FinCEN Yes Yes Yes Yes No Yes Yes Yes 

Percentage of 

private industry or 

financial institution 

customers finding 

FinCEN’s SAR 

products highly 

valuable 

FinCEN Yes Yes Yes Yes Yes Yes Yes Yes 

Cost per Bank 

Secrecy Act (BSA) 

form e-filed 

FinCEN No Yes Yes Yes Yes No Yes Yes 

Number of largest 

BSA report filers 

using e-filing 

FinCEN No Yes Yes Yes Yes No Yes Yes 

Number of users 

directly accessing 

BSA data 

FinCEN Yes Yes Yes Yes Yes Yes Yes Yes 

Page 38 GAO-09-794 Combating Illicit Financing
Appendix III: GAO Assessment of TFI’s Fiscal 

Year 2008 Performance Measures 

TFI performance 

measures Component Linkage Clarity 

Measurable 

target Objectivity Reliability 

Core 

program 

activities 

Limited 

overlap 

Governmentwide priorities

Percentage of 

customers satisfied 

with the BSA e-filing 

FinCEN No Yes Yes Yes No No Yes Yes 

Percentage of 

customers satisfied 

with WebCBRS and 

secure outreach 

FinCEN No Yes Yes Yes Yes Yes Yes Yes 

Share of BSA filings 

submitted 

electronically 

FinCEN No Yes Yes Yes Yes No Yes Yes 

Percentage of 

federal and state 

regulatory agencies 

with memorandums 

of understanding 

(MOU) or 

information-sharing 

agreements 

FinCEN Yes Yes Yes Yes Yes Yes Yes Yes 

Percentage of 

FinCEN’s 

compliance MOU 

holders finding 

FinCEN’s 

information 

exchange valuable 

to improve the BSA 

consistency and 

compliance of the 

financial system 

FinCEN Yes No Yes Yes Yes Yes Yes Yes 

Source: GAO analysis of the Treasury fiscal year 2008 performance and accountability report. 

Page 39 GAO-09-794 Combating Illicit Financing
Appendix IV: Comments from the Department Appendix IV: Comments from the of the Treasury 

Department of the Treasury 

Page 40 GAO-09-794 Combating Illicit Financing 
Appendix IV: Comments from the Department 

of the Treasury 

Page 41 GAO-09-794 Combating Illicit Financing
Appendix IV: Comments from the Department 

of the Treasury 

Page 42 GAO-09-794 Combating Illicit Financing
Appendix IV: Comments from the Department 

of the Treasury 

Page 43 GAO-09-794 Combating Illicit Financing
Appendix IV: Comments from the Department 

of the Treasury 

Page 44 GAO-09-794 Combating Illicit Financing
Appendix V: 

A

GAO Contact and Staff 

cknowledgments 

Page 45 GAO-09-794 

Appendix V: GAO Contact and Staff 

Acknowledgments 

Loren Yager, Director, (202) 512-4347, YagerL@gao.gov

In addition to the individual named above, Jeff Phillips (Assistant 

Director), Jason Bair, Lisa Reijula, Katherine Brentzel, Martin de Alteriis, 

and Mary Moutsos made key contributions to this report. Elizabeth Curda, 

Karen Deans, Cardell Johnson, Barbara Keller, and Hugh Paquette also 

contributed to the report. 

 Combating Illicit Financing 

GAO Contact 

Staff 

Acknowledgments 

(320608) 
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