GAO 

United States Government Accountability Office

Report to Congressional Requesters

ANTI-MONEY 

LAUNDERING 

Improved 

Communication Could 

Enhance the Support 

FinCEN Provides to 

Law Enforcement 

December 2009 

GAO-10-141 
What GAO Found

United States Government Accountability Office

Why GAO Did This Study

Highlights

Accountability Integrity Reliability

December 2009

ANTI-MONEY LAUNDERING 

Improved Communication Could Enhance the 

Support FinCEN Provides to Law Enforcement 

Highlights of GAO-10-141, a report to 

congressional requesters 

Financial investigations are used to 

combat money laundering and 

terrorism financing, crimes that 

can destabilize national economies 

and threaten global security. The 

Financial Crimes Enforcement 

Network (FinCEN) within the 

Department of the Treasury 

supports law enforcement agencies 

(LEAs) in their efforts to 

investigate financial crimes by 

providing them with services and 

products, such as access to 

financial data, analysis, and case 

support. As requested, GAO 

examined the extent to which the 

law enforcement community finds 

FinCEN’s support useful in its 

efforts to investigate and prosecute 

financial crimes. GAO analyzed 

statutes governing FinCEN’s 

mission and documentation 

describing the support it provides 

to LEAs, such as annual reports. 

Using FinCEN data, GAO selected a 

sample of 29 LEAs, including 

primary users of FinCEN’s services 

and products, and obtained their 

opinions through a survey and 

interviews. While the results of the 

survey and interviews are not 

generalizable, they provide insights 

about the usefulness of FinCEN’s 

support. 

What GAO Recommends

Among other things, GAO 

recommends that FinCEN improve 

communication with LEAs about 

the support it can provide, 

establish processes for soliciting 

input and complete a plan outlining 

the actions FinCEN will take to 

better meet LEAs needs. The 

FinCEN Director concurred with 

the recommendations. 

The majority of LEAs GAO surveyed reported finding FinCEN’s support useful 

in their efforts to investigate and prosecute financial crimes, but FinCEN 

could enhance its support by better informing LEAs about its services and 

products and actively soliciting their input. Of the 20 LEAs that responded to a 

question GAO posed about which FinCEN services they found most useful, 16 

LEAs cited direct access to Bank Secrecy Act data—records of financial 

transactions possibly indicative of money laundering that FinCEN collects—

as the most valuable service FinCEN provides. Additionally, 11 federal LEAs 

cited a tool that allows federal LEAs to reach out, through FinCEN, to 

financial institutions nationwide to locate financial information related to 

ongoing investigations as a key service offered by FinCEN. To further enhance 

the value and relevance of its analytic work to LEAs, FinCEN has sought to 

increase development of complex analytic products, such as reports 

identifying trends and patterns in money laundering. Sixteen law enforcement 

agencies GAO surveyed reported that they generally found these complex 

analytic products useful. 

However, three of five LEAs that FinCEN identified as its primary federal 

customers reported that FinCEN does not provide detailed information about 

the various types of products it can provide. They also stated that they would 

like more information about when completed products become available. 

Communicating more detailed information to LEAs could help FinCEN ensure 

that it is effectively carrying out its mission to support the investigation and 

prosecution of financial crimes. Moreover, two of these LEAs reported that 

FinCEN does not communicate to LEAs why it accepts some requests for 

support and rejects others. Furthermore, FinCEN does not actively seek 

LEAs’ input about ongoing or planned analytic work, though doing so could 

improve the quality and relevance of its products to its LEA customers. 

Actively soliciting stakeholder input and providing transparency with regard 

to decision making are GAO-identified best practices for effectively meeting 

stakeholder needs. Incorporating these best practices could help FinCEN 

maximize the usefulness of its support. In October 2009, senior officials in one 

of the divisions that provides support to LEAs reorganized the division in 

order to realign resources to better serve law enforcement. The division also 

developed a planning guide to improve communication with LEAs which 

includes general descriptions of the types of processes to be implemented. 

While the development of this guide is a step in the right direction, it does not 

include detailed information on the specific actions FinCEN plans to take to 

become more transparent to their law enforcement customers about the 

division’s operations. Completing the plan, including identifying the specific 

actions FinCEN plans to take to better assess law enforcement’s needs, could 

help FinCEN ensure that its operations are designed in a way so as to 

maximize their usefulness to its law enforcement customers. 

View GAO-10-141 or key components.

For more information, contact Eileen Larence 

at (202) 512-8777 or larencee@gao.gov. 
Page i GAO-10-141 

Contents 

Letter 1

Background 6 

Law Enforcement Finds a Number of FinCEN’s Services and 

Products Useful, but Would Like More Information about Select 

Products and Opportunities to Provide FinCEN with Input about 

Some Types of Support 12 

Conclusions 30 

Recommendations for Executive Action 31 

Agency Comments and Our Evaluation 31 

Appendix I List of Agencies GAO Surveyed 34 

Appendix II Comments from the Department of the Treasury 35 

Appendix III GAO Contacts and Staff Acknowledgments 37 

Related GAO Products 38 

 Anti-Money Laundering 
Abbreviations 

ALD FinCEN’s Analysis and Liaison Division 

APA Administrative Procedure Act 

BSA Bank Secrecy Act 

CBRS Currency Banking and Retrieval System 

DEA Drug Enforcement Administration 

DHS Department of Homeland Security 

DOJ Department of Justice 

FBI Federal Bureau of Investigation 

FinCEN Financial Crimes Enforcement Network 

FLETC Federal Law Enforcement Training Center 

FTE Full-Time Equivalent 

HIFCA High Intensity Financial Crime Area 

ICE Immigration and Customs Enforcement 

IPD FinCEN’s International Programs Division 

IRS Internal Revenue Service 

IRS-CI Internal Revenue Service–Criminal Investigation 

LEAs Law Enforcement Agencies 

MOU Memorandum of Understanding 

NPRM Notice of Proposed Rulemaking 

PRA Paperwork Reduction Act 

RPPD FinCEN’s Regulatory Policy and Programs Division 

SAR Suspicious Activity Report 

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Page ii GAO-10-141 Anti-Money Laundering
Page 1 GAO-10-141 

 

United States Government Accountability Office

Washington, DC 20548 

 

December 14, 2009 

The Honorable Barney Frank 

Chairman 

The Honorable Spencer Bachus 

Ranking Member 

Committee on Financial Services 

House of Representatives 

The Honorable Stephen F. Lynch 

House of Representatives 

Successful investigations into financial crimes can support the 

prosecution of money laundering, drug trafficking, and terrorist 

financing—crimes that have the potential to destabilize national 

economies and threaten global security. The Bank Secrecy Act (BSA),1

enacted in 1970, authorized the Secretary of the Treasury to establish antimoney laundering record keeping and reporting requirements for domestic 

financial institutions to help prevent abuse of the nation’s financial 

system.2

 The Department of the Treasury’s Financial Crimes Enforcement 

Network (FinCEN), established in 1990 to oversee the administration of 

the BSA, helps to prevent financial crime by serving as a governmentwide, 

service-oriented, financial information-sharing agency in support of more 

than 275 federal and state law enforcement agencies. Specifically, the BSA 

authorizes FinCEN to require financial institutions to make reports and 

maintain records that have a high degree of usefulness in criminal, tax, or 

regulatory investigations or proceedings, or in the conduct of intelligence 

or counterintelligence activities, including analysis to protect against 

international terrorism. In addition, the BSA authorizes FinCEN to require 

financial institutions to establish anti-money laundering programs.3

1

The BSA has three main objectives: create an investigative audit trail through regulatory 

reporting standards; impose civil and criminal penalties for noncompliance; and improve 

the detection of criminal, tax, and regulatory violations. 

2

Bank Secrecy Act, titles I and II of Pub. L. No. 91-508, 84 Stat. 1114 (1970) (codified as 

amended in 12 U.S.C. §§ 1829b, 1951-1959; 31 U.S.C. §§ 5311-5332). The BSA requires 

financial institutions to maintain records on financial transactions including suspicious 

activity that may be related to money laundering or other financial crimes. 

3

The Secretary of the Treasury has the authority to administer the BSA and its 

implementing regulations. This authority has been delegated to the Director of FinCEN. 

Therefore, we refer to the authority of the Secretary of the Treasury under the BSA 

synonymously with that of the Director of FinCEN. 

 Anti-Money Laundering 
 

Pursuant to its authority, FinCEN collects, maintains, analyzes, and 

disseminates financial information to law enforcement agencies in support 

of their investigation and prosecution of financial crimes. This information 

is maintained in a central database and is commonly referred to as BSA 

data.4

 Among other things, the support FinCEN provides to domestic law 

enforcement agencies, in their efforts to investigate and prosecute 

financial crimes, includes a variety of services and products such as 

providing access to the BSA data, responding to requests from law 

enforcement agencies for information pertaining to specific investigations, 

and producing analytic products covering a range of issues related to 

financial crimes.5

While FinCEN’s general mission is to help safeguard the U.S. financial 

system from such crimes, its specific roles and responsibilities have grown 

and evolved over time. For example, in the wake of post-9/11 concerns 

about the threat that terrorist financing can pose to national security, the 

enactment of the Uniting and Strengthening America By Providing 

Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 

2001 (USA PATRIOT Act) expanded FinCEN’s role to include a focus on 

terrorism financing as well as money laundering.6

 In light of FinCEN’s 

expanded mission, Congress has raised questions about FinCEN’s ability 

to meet the growing demands of its various roles and responsibilities, 

including the support it provides to law enforcement agencies’ efforts to 

investigate and prosecute financial crimes. This report, as part of a larger 

body of GAO work that addresses various aspects of FinCEN’s role as the 

administrator of the BSA, addresses FinCEN’s role in supporting law 

enforcement efforts to investigate and prosecute financial crimes, such as 

 

4

BSA data reported by financial institutions are processed and warehoused by the Internal 

Revenue Service’s Detroit Computing Center in the Currency Banking and Retrieval System 

(CBRS), more generally known as the BSA database. The BSA database can be accessed 

through a Web-based interface called WebCBRS. The majority of law enforcement users 

currently access the BSA database through FinCEN’s Gateway/Secure Outreach computer 

system, which functions as a portal through FinCEN’s information technology 

infrastructure to the BSA database. For more information, see GAO, Information Security: 

Further Actions Needed to Address Risks to Bank Secrecy Act Data, GAO-09-195 

(Washington, D.C.: Jan. 30, 2009). 

5

FinCEN also collaborates with international counterparts in other countries to facilitate 

sharing of financial information between domestic and international law enforcement 

agencies. For more information, see GAO, International Financial Crime: Treasury’s 

Roles and Responsibilities Relating to Selected Provisions of the USA PATRIOT Act, 

GAO-06-483 (Washington, D.C.: May 12, 2006). 

6

Pub. L. No. 107-56, 115 Stat. 272 (2001). 

Page 2 GAO-10-141 Anti-Money Laundering
 

money laundering and terrorism financing. Specifically, in response to 

your request, this report examines the extent to which the law 

enforcement community finds FinCEN’s support useful in their efforts to 

address such crimes. 

To answer this question, we first identified the support FinCEN is required 

to provide to domestic law enforcement agencies as defined by statutes 

governing FinCEN’s mission, including the BSA and the USA PATRIOT 

Act. We also reviewed and analyzed documentation, such as annual 

reports and strategic plans, as well as FinCEN’s responses to our 

information requests detailing the support it has provided to law 

enforcement agencies. In addition, we obtained data about those services 

and products provided since the enactment of the USA PATRIOT Act in 

2001 through 2007 to determine trends in these services and products over 

that time period. To assess the reliability of these data, we interviewed 

knowledgeable agency officials about the sources of the data and the 

controls FinCEN had in place to maintain the integrity of the data and 

determined that the data were sufficiently reliable for purposes of our 

report. In addition, we interviewed senior FinCEN management officials 

regarding FinCEN’s mission and responsibilities and how they have 

changed over time, including how managers characterize the impact that 

statutory and technological changes have had on FinCEN’s organizational 

structure, culture, and practices as it relates to serving law enforcement. 

Furthermore, we interviewed officials in FinCEN’s Analysis and Liaison 

Division (ALD), the division primarily responsible for providing support to 

law enforcement agencies, regarding its current responsibilities and how 

FinCEN’s services and products have changed over time.7

We also surveyed a nonprobability sample of 29 federal and state law 

enforcement agencies that included the primary users of FinCEN’s 

services and products in fiscal years 2001 through 2007 about the extent to 

which they found FinCEN’s services and products useful.8

 We conducted 

our survey in late 2008. To select our sample, we reviewed FinCEN data to 

identify federal and state law enforcement agencies that were the primary 

 

7

ALD consists of the Offices of Intelligence Support, Law Enforcement Support, Liaison 

Services, and Special Programs Development. 

8

Nonprobability sampling is a method of sampling when nonstatistical judgment is used to 

select members of the sample, using specific characteristics of the population as criteria. 

Results from nonprobability samples cannot be used to make inferences about a 

population, because in a nonprobability sample some elements of the population being 

studied have no chance or an unknown chance of being selected as part of the sample. 

Page 3 GAO-10-141 Anti-Money Laundering
 

users of one or more of FinCEN’s services and products during these 7 

fiscal years.9

 We identified 22 agencies to be the primary users of FinCEN’s 

services and products—13 federal agencies and 9 state agencies. The 

federal agencies we selected were the most frequent users of at least two 

of FinCEN’s services or products, and the state agencies we selected were 

the most frequent users of at least one of FinCEN’s services or products. 

We also included 2 federal law enforcement agencies with a significant 

financial crimes or anti-money laundering mission that were not among 

FinCEN’s primary customers but may potentially benefit from FinCEN’s 

services and products. As each of these 24 agencies could have had 

multiple agents receiving services and products from FinCEN and thus 

multiple people providing answers to the questionnaire, we requested that 

the responses reflect each agency’s official position about FinCEN.10

Additionally, we included five of the six High Intensity Financial Crime 

Areas (HIFCAs) where FinCEN had located liaisons.11 As these HIFCAs 

could have had representatives from multiple law enforcement agencies 

receiving services and products from FinCEN and thus multiple people 

providing input to answering the questionnaire, we also requested that 

their responses reflect each HIFCA’s official position about FinCEN. For a 

complete list of the agencies that received GAO’s questionnaire, please see 

appendix I. We did not receive usable questionnaires from four of the five 

HIFCAs, as representatives from each indicated that they could not 

provide a single questionnaire that reflected the HIFCA’s official position. 

In total, we received usable questionnaires from 25 of the 29 agencies we 

 

9

Fiscal year 2007 was the last full year for which data were available at the time we were 

selecting our sample. 

10We conducted pretests with two agencies to refine our questions, develop new questions, 

clarify any ambiguous portions of the questionnaire, and identify any potential biased 

questions. Because we surveyed a nonprobability sample of law enforcement agencies, 

there are no sampling errors. There are, however, practical difficulties associated with 

conducting any survey that may introduce errors, commonly referred to as nonsampling 

errors. For example, differences in how a particular question is interpreted or the 

information sources available to respondents can introduce unwanted variability into the 

survey results. We attempted to minimize these nonsampling errors through careful 

construction of the questionnaire and the pretests mentioned above. 

11HIFCAs are high-risk areas established under the Money Laundering and Financial Crimes 

Strategy Act of 1998, Pub. L. No. 105-310, 112 Stat. 2941, as a means of concentrating and 

coordinating law enforcement efforts at the federal, state, and local levels to combat 

money laundering or related financial crime in regions designated as high-intensity money 

laundering zones. There is a money-laundering action team associated with each HIFCA 

region composed of relevant federal, state, and local enforcement authorities, prosecutors, 

and financial regulators. For these purposes of our survey, we considered each HIFCA to 

be an agency. 

Page 4 GAO-10-141 Anti-Money Laundering
 

surveyed. To assess the reliability of the data we used to select these 

agencies, we interviewed knowledgeable FinCEN officials about the 

source of these data and the controls FinCEN had in place to maintain the 

integrity of the data. We determined that the data were sufficiently reliable 

for purposes of our report. 

We also interviewed officials from 8 of the 25 federal and state law 

enforcement agencies responding to our questionnaire, including the 

agencies that FinCEN has identified as its top five federal law enforcement 

customers. These included two Department of Justice (DOJ) component 

agencies—the Drug Enforcement Administration (DEA) and the Federal 

Bureau of Investigation (FBI); two Department of Homeland Security 

(DHS) component agencies—Immigration and Customs Enforcement 

(ICE) and the U.S. Secret Service; and one Treasury agency—the Internal 

Revenue Services’ Criminal Investigation Division (IRS-CI). We 

interviewed the FinCEN liaisons from each of these agencies about the 

support each agency has received from FinCEN and the extent to which 

this support has contributed to their investigations of money laundering, 

terrorist financing, and other financial crimes. Our analysis of FinCEN 

data verified that these five law enforcement agencies represent FinCEN’s 

federal law enforcement customers with an anti-money laundering mission 

that are among the top users of BSA data as well as among the top 

requestors of FinCEN’s analytic products. While responses to the survey 

and interviews cannot be generalized to reflect the views of all of 

FinCEN’s law enforcement customers, we believe that they provide 

essential perspectives about the usefulness of FinCEN’s services and 

products. 

In addition, we reviewed documentation, such as internal planning 

reports, provided by FinCEN and interviewed senior ALD officials 

regarding how the agency plans and prioritizes its services and products in 

support of law enforcement, including how ALD incorporates law 

enforcement input and feedback into its operations. Furthermore, we 

interviewed FinCEN officials about their existing policies and practices for 

planning and prioritizing the support they provide to law enforcement, as 

well as their practices for incorporating stakeholder input. We compared 

these efforts with federal best practices for effectively meeting 

stakeholder needs identified in prior GAO work to determine how 

FinCEN’s processes may differ from or reflect the use of these 

Page 5 GAO-10-141 Anti-Money Laundering
 

recommended practices.12 We also reviewed an internal ALD assessment of 

the support the division provides to its domestic law enforcement 

customers. Our analysis included reviewing the methodology, criteria, and 

assumptions of the study, and discussing the study’s scope, assumptions, 

and conclusions with FinCEN. As a result of our review and analysis, we 

determined that the study and its results were reasonable for use in our 

report. We conducted this performance audit from February 2008 through 

November 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 provides a reasonable basis for our findings 

based on our audit objectives. 

As part of its mission, one of FinCEN’s primary objectives is to provide 

services and products that enable enhanced detection and deterrence of 

financial crimes. Specifically, according to FinCEN, part of this objective 

includes expanding communications with its law enforcement customers 

to ensure that FinCEN’s services and products support and enhance law 

enforcement operations. FinCEN does not carry out any financial crimes 

investigations on its own; rather, by serving as a central source for 

financial intelligence information and analysis, FinCEN supports the 

investigative and prosecutive efforts of a network of more than 275 law 

enforcement agencies that includes federal agencies, United States 

Attorney’s offices, state and local law enforcement agencies, and state 

attorneys general as well as local district attorneys. 

Background 

In supporting law enforcement agencies, FinCEN administers the largest 

financial transaction reporting system in the world, which is based on 

recordkeeping and reporting requirements mandated or authorized under 

the BSA. This act authorizes the Secretary of the Treasury to issue 

regulations requiring financial institutions to retain records and file 

reports when doing so would have a high degree of usefulness in criminal, 

tax, and regulatory investigations or proceedings, or in the conduct of 

intelligence or counterintelligence activities, including analysis, to protect 

against international terrorism. For example, suspicious activity reports 

 

12GAO, Standards for Internal Control in the Federal Government, GAO/AIMD-00-21.3.1 

(Washington, D.C.: November. 1999) and GAO, Fisheries Management: Core Principles 

and a Strategic Approach Would Enhance Stakeholder Participation in Developing 

Quota-Based Programs, GAO-06-289 (Washington, D.C.: Feb. 23, 2006). 

Page 6 GAO-10-141 Anti-Money Laundering
 

(SARs) are filed by financial institutions to inform the federal government 

of any suspicious transaction related to a possible violation of law or 

regulation.13 The BSA regulatory framework establishes record keeping 

and reporting requirements for financial institutions in order to create a 

paper trail of financial transactions that federal agencies can use to detect 

illegal activity, such as money laundering or terrorist financing, and to 

apprehend criminals. Under the BSA framework, primary responsibility 

rests with the financial institutions in gathering information and passing it 

to federal officials. In 2001, the USA PATRIOT Act added the authority of 

the Secretary of the Treasury to issue regulations requiring financial 

institutions to retain records and file reports when doing so would have a 

high degree of usefulness in the conduct of intelligence or 

counterintelligence activities, including analysis, to protect against 

international terrorism.14

In 1994, the Secretary of the Treasury delegated overall authority for 

enforcement of, and compliance with, the BSA and its implementing 

regulations to the Director of FinCEN. To fulfill this role of BSA 

administration, FinCEN develops policy and provides guidance to other 

agencies, analyzes BSA data for trends and patterns, and enforces 

compliance when warranted. For example, FinCEN works with other 

agencies, such as the Internal Revenue Service (IRS) and federal financial 

regulatory agencies, to ensure financial institutions’ compliance with BSA 

requirements, such as having an anti-money laundering program and 

processes in place to report suspicious activity and certain other financial 

transactions. FinCEN also collects and stores the reported information. 

In fiscal year 2009, FinCEN had a budget of approximately $91.5 million 

and, since fiscal year 2002, the number of full-time staff rose from 222 to 

 

13Under the regulations administered by FinCEN, a SAR is generally required when a 

transaction is conducted or attempted by, at, or through a financial institution that involves 

or aggregates at least $5,000 in funds or other assets and the institution knows, suspects, or 

has reason to suspect that the transaction: involves funds derived from illegal activities; is 

intended or conducted in order to hide or disguise funds or assets derived from illegal 

activities as part of a plan to violate or evade any federal law or regulation or to avoid any 

transaction reporting requirement under federal law or regulation; is designed to evade any 

reporting requirement under federal law or other BSA requirement; has no business or 

apparent lawful purpose; or the transaction is not the sort in which the customer would 

normally be expected to engage and there is no reasonable explanation known for the 

transaction; or involves use of the institution to facilitate criminal activity. See 31 C.F.R. §§ 

103.15-.21. 

14Pub. L. No. 107-56, § 358, 115 Stat. 272, 326 (2001). 

Page 7 GAO-10-141 Anti-Money Laundering
 

324, representing an increase of 46 percent over the last 7 years.15 FinCEN 

is organized functionally into the Office of the Director and five 

operational divisions.16 Among these, FinCEN’s ALD is responsible for the 

majority of services and products provided in support of domestic law 

enforcement agencies, though the Regulatory Policy and Programs 

Division and International Programs Division also provide some support. 

Since fiscal year 2005, ALD’s full-time staff has risen from 60 to 77, 

representing an increase of 28 percent over the last 4 years.17 ALD analyzes 

BSA data in conjunction with publicly available information to produce its 

analytic products. ALD also has access to a variety of other databases that 

it can use in its analyses, such as information to locate individuals; 

determine asset ownership; and establish links among individuals, 

businesses, and assets.18 In addition, ALD serves as FinCEN’s liaison with 

domestic law enforcement agencies and manages their access to BSA data. 

Specific examples of the analytic support ALD provides to law 

enforcement agencies include the following: 

• Basic analytic support: This generally involves routine checks of the BSA 

database and other databases using names of suspects and other 

information provided by the requesting law enforcement agency that 

generally can be completed in 1 or 2 days by a single analyst. FinCEN also 

initiates its own routine checks of BSA data, such as regular reviews of 

those data with a potential terrorism connection, which the agency then 

aggregates and refers to relevant law enforcement agencies. FinCEN 

completed 409 basic analytic products in fiscal year 2007. 

 

15These additional resources were primarily allocated to FinCEN’s regulatory and 

international functions to meet demand associated with expansion of these mission areas. 

16The five divisions are ALD, the International Programs Division, the Management 

Programs Division, the Regulatory Policy and Programs Division, and the Technology 

Solutions and Services Division. 

17ALD was formed in late fiscal year 2004; therefore, full-time equivalent (FTE) data are not 

available before fiscal year 2005. Additionally, for comparative purposes, ALD FTE data for 

fiscal year 2005 does not include FTEs in the Office of Global Support, which was moved to 

the International Programs Division in fiscal year 2009. Among the 77 employees currently 

in ALD, 43 are analysts, 7 of whom perform management or administrative functions, and 7 

more of which are stationed outside of FinCEN. 

18FinCEN also has access to other databases, including LexisNexis, Dun and Bradstreet, as 

well as a variety of other financial and law enforcement databases. 

Page 8 GAO-10-141 Anti-Money Laundering
 

• Complex analytic products: FinCEN also provides a range of complex 

analytic products in support of the efforts of law enforcement agencies 

that can take anywhere from several months to several years to complete. 

FinCEN reported completing 37 complex analytic products in fiscal year 

2007. FinCEN’s complex analytic products can include the following: 

• Complex tactical case support involves large-scale, in-depth BSA data 

analysis related to specific law enforcement investigations, which can 

include preparation of graphic interpretations of BSA data, such as 

charts that demonstrate the financial links between various entities or 

organizations, as well as narrative summarizing relevant observations, 

findings, and recommendations provided by FinCEN analysts. 

• Strategic analysis projects or trend analyses generally represent a 

range of products that are designed to provide law enforcement 

officials with intelligence analyses and reports on longer-term or more 

broadly scoped topics, such as emerging trends, patterns, and issues 

associated with money laundering and other financial crimes. For 

example, FinCEN has produced strategic reports examining the 

processes and actors, both licit and illicit, involved in the flow of 

currency between the United States and neighboring countries along 

various regions of the U.S. borders.19 Strategic analysis projects can 

also include assessments of threats posed by large-scale money 

laundering and terrorist financing activities. These projects may be 

initiated by FinCEN or undertaken as joint projects in collaboration 

with law enforcement. 

• Technical reference manuals are intended to provide technical 

information on a variety of issues, including how particular financial 

transfer or payment mechanisms may be used to launder money. 

• Policy-level strategic projects are high-level analyses intended to shape 

the development of national policies relating to the regulation of the 

nation’s financial industries, allocation of law enforcement resources 

to anti-money laundering programs and initiatives, and development of 

global anti-money laundering and terrorist financing standards, 

policies, and activities. For example, in 2005 FinCEN participated in 

the development of the U.S. Money Laundering Threat Assessment, an 

interagency effort intended to explain how major money laundering 

methods operate and highlight areas that require further attention. 

 

19The flow of currency is the introduction of U.S. dollar banknotes into a foreign country 

and their repatriation to the United States. 

Page 9 GAO-10-141 Anti-Money Laundering
 

FinCEN provided or participated in the development of these types of 

products four times in fiscal year 2007. 

FinCEN also provides law enforcement agencies with other types of 

support including the following: 

• In-house assistance: FinCEN (1) provides office space for law enforcement 

agencies to locate full-time liaisons at FinCEN’s headquarters in Vienna, 

Virginia to facilitate their agencies’ access to FinCEN’s services and 

products; (2) enables law enforcement personnel who do not have direct 

access to BSA data to conduct their own research and analysis on-site 

with FinCEN and provides them office space and database access; and 

(3) provides FinCEN analysts on location in support of the work of 

HIFCAs in various regions of the country. 

• Training: FinCEN offers training, such as how to access BSA data and use 

it in support of financial crimes investigations, through a variety of 

methods, including online training, ad hoc sessions scheduled upon 

request, and employee participation in related conferences. In addition, 

two FinCEN specialists located at the Federal Law Enforcement Training 

Center (FLETC) in Glynco, Georgia, are available to offer training 

regarding the tools available to agents who conduct financial 

investigations. 

Separate from the above services and products, FinCEN’s Regulatory 

Policy and Programs Division (RPPD) and International Programs Division 

(IPD) also work with law enforcement to accomplish other agency 

objectives. For example, RPPD is responsible for the administration of 

BSA compliance in the financial industry and, as such, indirectly works to 

support law enforcement by developing and implementing regulatory 

standards so that law enforcement agencies have accurate and relevant 

information for conducting financial crimes investigations.20 This division 

 

20RPPD consists of the Office of Regulatory Policy, Office of Compliance, Office of 

Enforcement, Office of Regulatory Analysis, and Office of Outreach Resources. RPPD 

develops, modifies, and interprets regulations and regularly responds to requests for 

clarification of these regulations from state and federal regulatory agencies and the 

financial industry. It also promotes financial institutions’ compliance with BSA regulations 

by overseeing those federal regulators with delegated BSA responsibilities in various 

financial sectors, taking appropriate enforcement action against financial institutions that 

violate the BSA, and promoting improved consistency in BSA compliance examinations 

through development of an examiners’ manual. For more information on our larger body of 

work on FinCEN and its administration of BSA data, see GAO, Bank Secrecy Act: Federal 

Agencies Should Take Action to Further Improve Coordination and Information-Sharing 

Efforts, GAO-09-227 (Washington, D.C.: Feb. 12, 2009). 

Page 10 GAO-10-141 Anti-Money Laundering
 

also produces strategic analyses that it initiates or conducts at the request 

of regulatory agencies on specific cases of BSA noncompliance or on 

trends and patterns in the financial industry that at times are made 

available to law enforcement agencies. FinCEN also serves as the 

Financial Intelligence Unit for the United States. As such, it is responsible 

for receiving, requesting, analyzing, and disseminating financial 

information to support domestic law enforcement. FinCEN’s International 

Programs Division serves as the conduit for sharing financial information 

between domestic law enforcement and foreign financial intelligence 

units. The International Programs Division also liaises with foreign 

financial intelligence units to support law enforcement and other U.S. 

government agencies. Over the last several years, domestic law 

enforcement has increased its requests to FinCEN for information from 

foreign financial intelligence units to combat international money 

laundering, terrorist financing, and other financial crimes. 

Page 11 GAO-10-141 Anti-Money Laundering
 

Law enforcement agencies we surveyed generally reported finding 

FinCEN’s services and products useful, citing direct access to BSA data, 

on-site liaisons, and access to financial information on people or 

organizations suspected of being involved in significant money laundering 

or terrorism financing activities—known as the 314(a) process—as those 

that are among the most useful.21 As more law enforcement agencies have 

gained direct access to the financial data FinCEN manages, the agency has 

sought to increase production of more complex analytic products, such as 

those identifying money laundering trends and patterns. While law 

enforcement agencies reported that they generally found these complex 

analytic products useful, they also reported that actively soliciting law 

enforcement input in the development of products as well as improved 

communication about how FinCEN develops, selects, and disseminates 

these products could enhance the value of FinCEN’s support. While 

FinCEN has recently taken initial steps to more actively solicit input on 

proposed regulatory actions, FinCEN has no mechanism to collect 

comments that may include law enforcement sensitive information in a 

nonpublic rulemaking record, the inclusion of which could be pertinent to 

making decisions regarding proposed changes.22

Law Enforcement 

Finds a Number of 

FinCEN’s Services 

and Products Useful, 

but Would Like More 

Information about 

Select Products and 

Opportunities to 

Provide FinCEN with 

Input about Some 

Types of Support 

Law Enforcement 

Agencies Cite a Number of 

FinCEN’s Services as 

Useful, and FinCEN Has 

Sought to Increase the 

Production of Complex 

Analytic Products 

 

21Section 314(a) of the USA PATRIOT Act required the Secretary of the Treasury to issue 

regulations to encourage further cooperation among financial institutions, financial 

regulatory authorities, and law enforcement authorities to promote sharing information 

regarding individuals, entities, and organizations engaged in or reasonably suspected of 

engaging in terrorist acts or money laundering activities, and to permit the sharing of 

information by law enforcement and regulatory authorities with financial institutions 

regarding persons reasonably suspected of engaging in terrorist acts or money laundering 

activity. 31 U.S.C. § 5311 note (Cooperative Efforts to Deter Money Laundering). See also 

31 C.F.R. § 103.100. 

22Comments submitted on proposed regulatory changes are generally made in a public 

record referred to as a public rulemaking docket which serves as the official repository for 

documents or information related to an agency’s rulemaking activities and may include any 

public comments received and other information used by agency decision makers. 

Page 12 GAO-10-141 Anti-Money Laundering
 

In both interviews and in response to our survey, law enforcement 

agencies generally reported finding FinCEN’s services and products 

useful, and cited direct access to BSA data, the 314(a) process, and on-site 

liaisons as among the three most useful services or products FinCEN 

provides. Title III of the USA PATRIOT Act expanded the role of relevant 

federal financial agencies in the prevention, detection, and prosecution of 

financial crimes by, in part, increasing the number of financial institutions 

and organizations subject to the BSA. The USA PATRIOT Act amended 

certain reporting requirements and anti-money laundering provisions of 

the BSA, and as a result, FinCEN issued regulations adding BSA 

requirements and provisions to institutions not previously covered, such 

as securities and futures firms and money services businesses. As a result, 

FinCEN now provides law enforcement agencies with access to these 

expanded BSA data. In response to our survey, most law enforcement 

agencies responding (16 out of 20) cited direct access to BSA data as most 

useful and 19 out of 22 agencies responding indicated that BSA data was 

the FinCEN service they used most often.23 Liaisons from three of 

FinCEN’s top five federal law enforcement customers noted that direct 

access to the BSA database provides law enforcement a means to access 

these data in order to help identify, deter, and detect money laundering or 

other potential financial crimes related to a range of criminal activity. 

Law Enforcement Agencies 

Cited Direct Access to BSA 

Data, the 314(a) Process, and 

On-site Liaisons as the Most 

Useful Services FinCEN 

Provides 

Over the last several years, improvements in technological capabilities 

have also enabled FinCEN to provide an increasing number of law 

enforcement agencies with direct access to the BSA database. Rather than 

relying on FinCEN analysts to conduct queries of BSA data on their behalf, 

federal, state, and local law enforcement agencies can now access the data 

directly through a secure Web connection after an agency has entered into 

a memorandum of understanding (MOU) with FinCEN outlining the 

parameters of BSA data access, security, and sharing.24 An MOU typically 

allows multiple users at each law enforcement agency to access the BSA 

data. FinCEN provides training and technical support on accessing the 

data and monitors use to help ensure that the BSA information is properly 

 

23Although a total of 25 law enforcement agencies responded to our questionnaire, all 25 

agencies did not provide responses to each question. For example, a total of 20 agencies 

responded to the question regarding which FinCEN service or product they found to be 

most useful, and 22 agencies responded to the question regarding which FinCEN service 

they use most often. 

24FinCEN provides agencies with user access credentials and access to the data through a 

portal that FinCEN operates, controls, and monitors. 

Page 13 GAO-10-141 Anti-Money Laundering
 

used, disseminated, and secured.25 Since 2002, the number of MOUs 

FinCEN had established with law enforcement agencies to govern their 

access to the BSA database rose from 90 to 278, representing an increase 

of more than 200 percent over 7 years. Similarly, since 2002 the overall 

number of BSA data users rose from 903 to 3,535, representing an increase 

of nearly 300 percent in user accounts over 7 years. Additionally, four of 

FinCEN’s top five federal law enforcement customers—DEA, the FBI, ICE, 

and the Secret Service—now receive access to larger BSA datasets via 

bulk a data download link that FinCEN provides to them each month 

through FinCEN’s secure Web site.26 According to FinCEN officials, direct 

access to BSA data enables federal and state law enforcement customers 

to more readily obtain and use the data in their investigations of financial 

crimes. In many cases, law enforcement is now capable of conducting 

even more sophisticated BSA analysis, including identifying links in the 

BSA data and integrating the data with commercially available as well as 

agency-specific databases (i.e., investigative records). 

As a result of the USA PATRIOT Act, FinCEN also introduced a new tool 

to further assist federal law enforcement agencies in their investigations of 

financial crimes. In response to Section 314(a) of the USA PATRIOT Act, 

FinCEN established a process that enables federal law enforcement 

agencies to reach out, through FinCEN, to more than 45,000 points of 

contact at more than 27,000 financial institutions across the country for 

potential information related to financial crimes investigations.27 FinCEN 

facilitates the 314(a) process, which was initiated in November 2002, 

through the use of a secure communications system that allows law 

enforcement to quickly locate financial data, such as open accounts and 

financial transactions related to ongoing investigations of persons, entities, 

or organizations suspected of being involved in significant money 

laundering or terrorism financing activities. Specifically, FinCEN receives 

requests from federal law enforcement and, upon review, forwards these 

requests for financial data to designated contacts within domestic 

 

25A GAO report issued in January 2009 found that FinCEN and the IRS must act to better 

secure BSA data and systems. The report states that although these Treasury agencies have 

enacted numerous related controls, significant weaknesses existed that impaired their 

ability to ensure the confidentiality, integrity, and availability of these information and 

systems. See GAO-09-195. 

26Because the BSA data are housed at IRS’s Detroit Computing Center, IRS officials can 

access the data directly through their agency’s intranet site. 

27The 314(a) process is not currently made available to state law enforcement agencies. 31 

C.F.R. § 103.100. 

Page 14 GAO-10-141 Anti-Money Laundering
 

financial institutions once every 2 weeks.28 The financial institutions must 

query their records for data matches, including accounts maintained by 

the named subject during the preceding 12 months and transactions or 

transmittals conducted within the last 6 months that are required under 

law or regulation to be recorded by the financial institution or are 

recorded and maintained electronically by the institution. Financial 

institutions have 2 weeks from the transmission date of the request to 

respond. 

Federal law enforcement agencies reported that the 314(a) process is a 

key service offered by FinCEN that provides case-specific and timely 

information to support ongoing law enforcement investigations. 

Specifically, all 11 federal agencies we surveyed that had a basis to judge 

the 314(a) process responded that it was either very or extremely helpful. 

Similarly, 10 of these 11 federal agencies reported being very satisfied with 

FinCEN’s ability to respond to 314(a) requests in a timely manner. Further, 

in an interview, a liaison from one of FinCEN’s top five law enforcement 

customers elaborated on the benefits of this process, stating that it enables 

law enforcement agencies to access financial information that might not 

be recorded in the available BSA data and is one of the most efficient tools 

FinCEN provides. 

Finally, law enforcement agencies reported that being able to maintain 

agency liaisons on-site at FinCEN is another valuable service FinCEN 

provides, facilitating law enforcement agency access to FinCEN’s services 

and products. In responding to our questionnaire, all nine of the federal 

law enforcement agencies that indicated they had on-site liaisons reported 

that it was extremely helpful. For example, in response to a question on 

agencies’ experience with having on-site liaisons, an official from one 

federal law enforcement agency reported that this facilitates the agency’s 

access to timely financial information in support of financial crimes 

investigations. Similarly, in an interview, an official from one of FinCEN’s 

top five federal law enforcement customers stated that having a liaison on-

 

28To ensure that Section 314(a) inquiries are being used only for appropriate cases, 

FinCEN’s Section 314(a) process requires federal law enforcement to provide assurances 

that the request has been subject to appropriate scrutiny at the agency level and that the 

matter under investigation satisfies FinCEN’s standards for processing a formal Section 

314(a) inquiry. As such, FinCEN requires each requester to submit a form—which FinCEN 

reviews before forwarding the request to financial institutions—certifying that the 

investigation is based on credible evidence of terrorist financing or money laundering. 

Page 15 GAO-10-141 Anti-Money Laundering
 

site also provides opportunities for collaboration with other liaisons from 

different law enforcement agencies. 

As more law enforcement agencies gained the ability to directly access the 

BSA data and conduct their own searches, their reliance on FinCEN to 

conduct basic queries on their behalf has decreased. From 2004 through 

2007, requests to FinCEN to conduct such queries have decreased 80 

percent from 2,048 to 409.29 As a result, FinCEN has identified a need to 

redefine its role in supporting law enforcement agencies and enhance the 

value and relevance of its analytic work. As part of this effort, in recent 

years FinCEN has sought to increase its production of more sophisticated 

complex analytic products. These products range from complex tactical 

case support requiring large-scale BSA data analysis, to a variety of 

strategic projects, studies, and trend analyses intended to identify and 

explain money laundering methodologies or assess threats posed by largescale money laundering and terrorist financing activities. For example, in 

2007 FinCEN provided a study to one law enforcement agency that 

identified currency flows between the United States and another country 

which helped this agency to identify potential patterns in drug trafficking. 

These strategic analysis projects and trend analyses may be the result of 

work that FinCEN self-initiates, performs at the request of a law 

enforcement agency, or jointly undertakes in conjunction with other law 

enforcement agencies. 

FinCEN Has Sought to Increase 

Production of More Complex 

Analytic Products, Which Law 

Enforcement Agencies Report 

Are Helpful in Financial Crimes 

Investigations 

Based on responses to our survey and interviews, law enforcement 

agencies reported general satisfaction with FinCEN’s analytic products. 

For example, of the 16 agencies that indicated they used FinCEN’s 

strategic analysis products, 8 reported the products to be very or 

extremely helpful, and 8 reported that they were moderately helpful. 

Similarly, when asked why they requested analytic support from FinCEN, 

15 out of 17 agencies that indicated they had made such requests reported 

that they did so because they believed FinCEN has unique expertise 

related to analyzing the BSA data.30 For example, one law enforcement 

agency noted that FinCEN’s ability to conduct large-scale data analysis in 

 

29FinCEN did not track the number of basic queries requested by law enforcement agencies 

before fiscal year 2004, so FinCEN was unable to provide us these data for fiscal years 2001 

through 2003. 

30Law enforcement agencies were asked about their reasons for requesting any type of 

analytic support from FinCEN, including requests for both basic and complex analytic 

products. 

Page 16 GAO-10-141 Anti-Money Laundering
 

support of specific law enforcement investigations is very useful. 

Similarly, among the 19 law enforcement agencies that indicated in the 

questionnaire they had used FinCEN’s technical reference manuals, 17 

reported that they believed the manuals were either very or extremely 

helpful. Furthermore, in interviews, the liaisons from all of FinCEN’s top 

five federal law enforcement customers specifically highlighted reference 

manuals as one of the most useful complex analytic products FinCEN 

produces. Among the 7 law enforcement agencies that provided additional 

information about the usefulness of these manuals, officials from all 7 

agencies noted that the manuals helped agents to better understand the 

particular types of financial transactions that may be used in financial 

crimes. These officials reported that their agencies use the reference 

manuals both for training purposes and as reference guides in the course 

of specific investigations. A liaison from one of FinCEN’s top five federal 

law enforcement customers noted that the reference manuals that the 

liaison’s agency posts on its intranet site receive many hits, and manuals 

covering topics such as Internet payment mechanisms and wire transfers 

have been particularly helpful to agents in the field. Similarly, according to 

a senior official from another of these federal law enforcement customers, 

reference manuals that cover emerging issues, such as technologies that 

are impacting money laundering, including mobile wire transfers, are 

particularly helpful for informational and training purposes. 

FinCEN Could Enhance Its 

Support of Financial 

Crimes Investigations by 

Better Informing Law 

Enforcement about Its 

Products and Actively 

Soliciting Their Input on 

Proposed Products and 

Regulatory Changes 

Page 17 GAO-10-141 Anti-Money Laundering
 

While law enforcement agencies we surveyed reported general satisfaction 

with FinCEN’s complex analytic products, FinCEN could better inform 

law enforcement about the types of products it can produce and the 

availability of completed analytic products. According to liaisons from 

three of FinCEN’s top five federal law enforcement customers, FinCEN 

does not provide detailed information about each type of product that 

would help law enforcement agencies to understand the types of support 

FinCEN can provide.31 Moreover, FinCEN’s Web site states that the agency 

provides “support of complex investigations” and “strategic analysis,” but 

does not provide further information, such as detailed descriptions or 

examples of the various complex analytic products it can produce, or 

information on services and products to better inform stakeholders about 

available support. Senior ALD officials also acknowledged that they could 

clarify and better communicate to their law enforcement customers the 

various types of complex analytic products FinCEN can provide. 

Better Informing Law 

Enforcement about the Types 

of Complex Analytic Products 

FinCEN Can Provide and the 

Availability of Completed 

Products Could Help Law 

Enforcement Utilize the Full 

Range of FinCEN Products 

In addition, in both interviews and in response to open-ended survey 

questions, officials from 7 of the 25 law enforcement agencies we 

surveyed, including three of FinCEN’s top five federal law enforcement 

customers, also indicated that they would like more information about 

when completed products become available.32 An official from one of 

FinCEN’s top five federal law enforcement customers noted that, in some 

cases, analyses FinCEN conducts for one customer might also be useful to 

the investigations of other financial crimes. While FinCEN officials 

acknowledged that its customers would like more information about when 

completed products become available, they stated that their approach to 

distribution varies from product to product. FinCEN officials said that 

they inform stakeholders about available products in working groups, 

conferences, and task forces, but noted they do not have a process to 

distribute completed analytic products or identify which law enforcement 

 

31Our interviews with law enforcement agencies including interviews with the liaisons of 

the five federal agencies that use the most FinCEN services and products involved aspects 

of each agency’s experiences working with FinCEN. As a consequence, we did not ask the 

same questions of all liaisons in these interviews. Officials with these agencies volunteered 

this information; therefore, we do not know the extent to which the other agencies had 

concerns regarding outreach. 

32Because officials volunteered this information in both interviews and in response to openended survey questions, we do not know the extent to which other agencies had similar 

concerns. 

Page 18 GAO-10-141 Anti-Money Laundering
 

agencies should receive them.33 In those cases where FinCEN may decide 

to more widely distribute a report initiated in response to a request from a 

single agency, it first asks the requesting agency for its permission to do so 

after removing any sensitive or agency-specific information as necessary. 

For example, in 2006, FinCEN completed a study of limited liability 

companies at the request of a single law enforcement agency but 

recognized that this report would also be useful to a wider audience. 

Therefore, the agency subsequently decided to expand the report and 

made it publicly available on its Web site so that other law enforcement 

agencies, regulators, and interested parties could have access to the 

report. FinCEN officials stated that they may also sometimes notify users 

on the Secure Outreach system about the availability of some analytic 

reports, but acknowledged that not all law enforcement agents use Secure 

Outreach on a regular basis so they may not be aware of when such 

notifications are posted on the system.34

However, based on responses to several questions about the availability of 

analytic products, the majority of the agencies we surveyed had limited 

knowledge of what strategic analysis products FinCEN had completed that 

may be useful to them. Specifically, 9 of the 25 agencies noted that they 

had not received any of the strategic analysis products FinCEN has issued 

since 2004, and another 5 indicated that they had only received one of 

these products. Similarly, liaisons from three of FinCEN’s top five federal 

law enforcement customers with whom we spoke reported that FinCEN 

does not actively communicate with them about when completed products 

become available, and as a result, it is difficult for these agencies to be 

aware of all of FinCEN’s products that could be useful in their 

investigations of financial crimes. According to FinCEN officials, some of 

FinCEN’s completed analytic products are suitable for dissemination to a 

broad law enforcement audience, while others are targeted to a specific 

law enforcement customer or may contain sensitive information and as a 

result are only suitable for dissemination to a limited law enforcement 

audience. However, a liaison from one of FinCEN’s top five federal law 

enforcement customers with whom we spoke noted that it is unclear when 

 

33For example, FinCEN reported that, in fiscal year 2009, ALD staff attended 19 

conferences to deliver presentations about specific technical reference manuals and 

attended 17 conferences to do the same for their services and products in general. 

34The majority of users access BSA data through FinCEN’s Secure Outreach system, which 

functions as a portal through FinCEN’s information technology infrastructure to BSA data. 

Law enforcement agents typically only log into Secure Outreach when conducting queries 

of the BSA data during open or ongoing investigations. 

Page 19 GAO-10-141 Anti-Money Laundering
 

and under what circumstances FinCEN decides it can or will attempt to 

share those products that other law enforcement agencies may also find 

useful. In addition, in an internal report generated by ALD staff in August 

2008, ALD officials acknowledged that law enforcement liaisons reported 

that they would like FinCEN to provide clear guidance on the 

dissemination of its products.35 FinCEN’s mission is to provide a financial 

intelligence and analysis network to support the detection, investigation, 

and prosecution of domestic and international money laundering and 

other financial crimes. By clarifying what products and services it can 

provide to its law enforcement customers, and establishing a process for 

informing them about the availability of completed products that may be 

of use in their investigations, FinCEN could better ensure that it is 

effectively carrying out its mission to support the investigation and 

prosecution of financial crimes. 

While FinCEN has informed law enforcement that it is now focusing the 

support it provides predominantly on those requests that it considers to be 

for complex analytic support, it could better inform law enforcement 

about its decision-making process regarding what requests it will accept or 

reject so that law enforcement can determine which requests may warrant 

FinCEN’s involvement. Law enforcement agencies may submit requests 

for complex analysis in support of specific investigations;36 however, in 

interviews with officials from FinCEN’s top five federal law enforcement 

customers, liaisons from two of these agencies stated that they did not 

fully understand what types of cases FinCEN is willing and able to 

support.37 For example, one of these liaisons stated that he understands 

that the agency wants to focus its support on requests that it considers to 

be for complex investigative support or strategic analysis. However, he 

reported that when his agency tried to seek assistance with a complex 

investigation, FinCEN responded that the request involved so much data 

Defining the Types of Requests 

for Complex Analytic Support 

That FinCEN Will Accept Could 

Help Law Enforcement Better 

Utilize FinCEN’s Expertise in 

Analyzing the BSA Data 

 

35In 2008, ALD conducted an internal assessment of the support the division provides to its 

domestic law enforcement customers. The resulting internal report, provided to senior 

FinCEN management in August 2008, assesses the division’s efforts to measure the 

requirements of FinCEN’s law enforcement customers and align the resources and efforts 

of ALD personnel to satisfy those requirements. This report outlined several 

recommendations designed to enhance FinCEN support and better meet the needs of its 

law enforcement customers. 

36As noted earlier, this type of support may involve large-scale, in-depth BSA data analysis 

related to specific law enforcement investigations. 

37Because officials volunteered information about their concerns during interviews, we do 

not know the extent to which the other three agencies may have similar concerns. 

Page 20 GAO-10-141 Anti-Money Laundering
 

that it was unable to handle the volume and complexity of the request. As 

a result, he said that his agency needs FinCEN’s assistance in better 

understanding what size cases the agency’s analysts are willing and able to 

handle. 

Furthermore, in response to an open-ended survey question on FinCEN’s 

analytic support, officials from two other law enforcement agencies 

reported that they do not fully understand FinCEN’s decision-making 

process for accepting or rejecting requests for support. These agencies 

indicated that while they understand that FinCEN has limited staff and 

resources to dedicate to analytic support, FinCEN has not been consistent 

in responding to their requests for support and does not always provide 

explanations why specific requests were rejected. In addition, in the 

internal report generated by ALD staff in August 2008, ALD officials 

acknowledged confusion among law enforcement customers about the 

types of requests FinCEN will accept, as well as law enforcement agencies’ 

concern that FinCEN does not sufficiently explain the reasons for 

declining specific requests for support. The report stated that FinCEN 

needs to establish a process for the receipt, review, and selection of 

proposals for complex analytic products as well as to communicate 

FinCEN’s decisions for rejecting requests to law enforcement. 

According to FinCEN officials, the agency has established criteria it uses 

to decide whether to accept a request for case support.38 However, while 

senior FinCEN officials told us that they have shared the criteria with law 

enforcement, these officials acknowledged that the criteria are not precise 

and are open to interpretation. Furthermore, they noted that they have not 

sufficiently explained the criteria to law enforcement, discussed how they 

apply the criteria to individual requests for support, or used them to create 

guidelines that would allow law enforcement agencies to easily 

 

38FinCEN officials informed us that ALD applies the following internal criteria in 

determining whether or not to accept a request for case support: (1) the BSA data available 

that relates to the case must enable FinCEN to do substantive analysis that FinCEN 

officials believe will have an impact on the case (although, according to FinCEN, there is 

not currently a requirement for a minimum or maximum number of records); (2) the 

requesting law enforcement agency must be willing to brief FinCEN analysts so that 

FinCEN can better focus its efforts in support of the request; (3) the potential complexity 

of the case and the BSA data involved are considerable—FinCEN prefers to accept cases in 

which it will analyze the data in unique ways that the law enforcement agency would not be 

able to accomplish with its own software and/or expertise; and (4) the requested case 

support should benefit FinCEN and enhance FinCEN’s knowledge—FinCEN chooses cases 

that will help it in targeting its proactive analyses or allow it to demonstrate to Congress 

that it is working on current issues of interest. 

Page 21 GAO-10-141 Anti-Money Laundering
 

understand what types of requests for support FinCEN will accept. ALD’s 

2008 internal report also acknowledged that FinCEN has not incorporated 

its internal criteria into established standard operating procedures, or 

documented them in a way that its customers may access or readily 

understand. We have previously reported that using an open and clearly 

defined decision-making process is essential for effectively meeting 

stakeholder needs.39 Senior officials acknowledged the report’s findings 

and as a first step, reorganized ALD in October 2009 in order to realign 

resources to better meet law enforcement’s needs. For example, FinCEN 

officials reported that they created a new office within ALD that is 

responsible for providing proactive analysis of BSA data and 

communicating regularly with law enforcement agents in the field. 

Officials noted that the goal of the office will be to develop products and 

information on BSA data trends and patterns in order to help inform law 

enforcement investigations of financial crimes. ALD also identified the 

development and implementation of processes to improve communication 

with its law enforcement customers as a 2010 priority. ALD created a 

planning guide for improving communication with law enforcement that 

includes a general description of the types of processes to be 

implemented, the office responsible for implementing these processes, 

identification of the relevant goal or strategic objective, and quarterly 

milestones for implementing components of the plan. While the 

development of this guide is a step in the right direction, the guide does 

not include detailed information on the specific actions FinCEN plans to 

take to better assess law enforcement’s needs and to become more 

transparent to their law enforcement customers about the division’s 

operations. Identifying the specific actions FinCEN plans to take to 

improve communication with law enforcement will help FinCEN ensure 

that its operations are designed in a way as to maximize its usefulness to 

its law enforcement customers. 

While FinCEN communicates with its law enforcement customers about a 

variety of issues, the agency could enhance the value of its complex 

analytic products by more actively soliciting law enforcement’s input 

about ongoing or planned analytic work. According to FinCEN officials, 

the agency primarily relies on ad hoc communication with law 

enforcement agencies, such as talking with law enforcement 

representatives located on-site, with law enforcement representatives at 

conferences, or with individual agents in the field, to discuss a variety of 

Actively Soliciting Input on the 

Development of Complex 

Analytic Products Could Help 

FinCEN Enhance Their Value 

to Law Enforcement Agencies 

 

39GAO-06-289. 

Page 22 GAO-10-141 Anti-Money Laundering
 

issues including its current analytic work. In interviews with officials from 

FinCEN’s top five federal law enforcement customers, liaisons from all 

five agencies reported that FinCEN does not consistently seek their input 

about ongoing or planned analytic work. Four of the liaisons stated that, 

as a result, they do not have regular opportunities to provide FinCEN with 

meaningful input about what types of products would be useful to them, 

potentially creating a gap between the products the agency generates and 

the products that its law enforcement customers need and want. For 

example, a liaison from one of these four agencies reported that he and 

other law enforcement liaisons have asked FinCEN to focus more on 

completing analyses of certain BSA activities by geographic area because 

most law enforcement agencies do not have the capability to do that kind 

of analysis in-house and because it would provide them with a valuable 

tool in interpreting what may constitute unusual activity related to an 

investigation. However, this official reported that FinCEN has not been 

responsive to his agency’s suggestions for the types of analytic products to 

pursue. Similarly, three other law enforcement liaisons noted that FinCEN 

does not provide them with regular opportunities to make proposals 

regarding the types of complex analytic products FinCEN should 

undertake. 

Beyond ad hoc communication with law enforcement agencies, FinCEN 

does not have a systematic process for soliciting input from law 

enforcement agencies on the development of its complex analytic 

products. While FinCEN holds a series of bimonthly meetings with some 

federal law enforcement representatives, known as the law enforcement 

roundtable, the agency uses it primarily for general information sharing, 

such as discussing the current missions of participating agencies and the 

offices and divisions within FinCEN or providing updates about the 314(a) 

process.40 According to FinCEN officials, the agency does not use the 

roundtable to discuss ongoing investigations or to solicit input from law 

enforcement about the development and prioritization of its complex 

analytic products. According to liaisons from four of FinCEN’s top five 

federal law enforcement customers, FinCEN could improve the quality 

and relevance of its products by more actively soliciting input from law 

enforcement during the development of complex analytic products. For 

 

40The law enforcement roundtable is typically attended by those federal law enforcement 

agencies that have liaisons located at FinCEN, though law enforcement agencies that do 

not have on-site liaisons may also attend the meetings. FinCEN officials acknowledged that 

not all federal law enforcement agencies attend the meetings and that state and local law 

enforcement agencies rarely, if ever, attend. 

Page 23 GAO-10-141 Anti-Money Laundering
 

example, one of these liaisons noted that FinCEN does not consistently 

seek input from those federal law enforcement agencies with experience 

in specific issue areas that may be able to provide subject matter expertise 

and help inform FinCEN’s analytic work. Furthermore, in their August 

2008 internal report, ALD officials acknowledged the concerns of its law 

enforcement customers regarding their lack of opportunities to provide 

input on FinCEN’s planned complex analytic products, and that FinCEN 

does not always solicit or incorporate law enforcement input in the 

selection of complex analytic projects. As a solution, the internal report 

recommended that the law enforcement roundtable be used as a forum to 

discuss proposals for analytic products with FinCEN’s law enforcement 

customers. While this is a productive step, relying solely on the roundtable 

may not allow opportunities for some of FinCEN’s other law enforcement 

stakeholders to provide input because the roundtable is typically only 

attended by federal law enforcement customers and, even then, not all of 

these customers are able to regularly attend these meetings. 

FinCEN does use annual surveys and feedback forms to obtain feedback 

from law enforcement on the usefulness of some completed products, 

although these surveys and forms are not designed to obtain detailed 

information on the full range of services and products FinCEN provides. 

FinCEN’s annual survey is provided to those domestic law enforcement 

customers that requested or received case support from FinCEN in the 

prior fiscal year. The surveys are designed to obtain feedback on various 

aspects of the specific product received, such as the relevancy, 

thoroughness, timeliness, and usefulness of the product. FinCEN also 

attaches one-page feedback forms to analytic products that are distributed 

to law enforcement customers. The feedback forms contain five questions 

intended to capture “Yes” or “No” answers on whether and how the 

product was useful in an investigation, whether the product was received 

in a timely way, if networking with another law enforcement agency was 

involved, and if the customer was satisfied overall with FinCEN’s service. 

However, according to FinCEN officials, neither the annual survey nor the 

feedback forms are designed to obtain detailed information from law 

enforcement customers on FinCEN’s full range of analytic products. For 

example, the annual surveys do not cover other analytic products such as 

FinCEN’s strategic analysis reports or its technical reference guides. 

Furthermore, these officials noted that FinCEN does not survey all of its 

law enforcement customers about their satisfaction with FinCEN’s 

services and products; rather, these surveys are provided only to those law 

enforcement customers that requested or received support in the previous 

year. 

Page 24 GAO-10-141 Anti-Money Laundering
 

Moreover, senior FinCEN officials noted that both the annual survey and 

the feedback forms have typically had very low response rates and 

FinCEN officials reported that law enforcement does not consistently 

complete and return the feedback forms and noted that the forms are not a 

source of significant or meaningful feedback from law enforcement.41 In 

discussing the limitations of the feedback forms, some law enforcement 

officials told us that, in many cases, agents in the field do not complete 

them because the type of feedback that can be provided to FinCEN 

immediately after receiving the support is very limited. These officials 

stated that while law enforcement can speculate that tactical case support 

provided by FinCEN will eventually be helpful in their case, until the case 

progresses there is no immediate way for law enforcement to respond to 

the specific questions in the feedback form regarding how the information 

was used and if it was useful in expanding the investigation or moving 

toward an indictment. 

Soliciting stakeholder input and involving stakeholders early and 

throughout the decision-making process are core principles that we have 

previously identified as best practices for effectively meeting stakeholder 

needs.42 In addition, Standards for Internal Control in the Federal 

Government states that it is essential to ensure effective communication 

with external stakeholders that may have a significant impact on the 

agency achieving its goals.43 While FinCEN’s annual survey and feedback 

forms provide law enforcement agencies with an opportunity to give 

FinCEN feedback about completed products, FinCEN does not actively 

solicit law enforcement input about ongoing or planned analytic work. 

FinCEN officials emphasized that law enforcement also has a 

responsibility to provide constructive input on FinCEN’s services and 

products. While we recognize that communication between FinCEN and 

its law enforcement customers is a shared responsibility, actively soliciting 

stakeholder input will allow FinCEN to capture stakeholder interests and 

better incorporate law enforcement perspectives into the development of 

complex analytic products. This will in turn increase the usefulness of 

these products to a wider law enforcement audience and maximize the 

resources spent on these products. Furthermore, soliciting input from law 

 

41FinCEN reported that the overall response rates were 54 and 40 percent, respectively, for 

the investigative case report and target report surveys distributed in 2007. 

42GAO-06-28. 

43GAO/AIMD-00-21.3.1. 

Page 25 GAO-10-141 Anti-Money Laundering
 

enforcement agencies about planned work would provide these agencies 

with opportunities to share relevant information from their own 

investigations and experience that could make these products of greater 

use to a broader range of law enforcement customers. 

While FinCEN has recently taken initial steps to more actively solicit input 

on proposed regulatory actions, FinCEN has no mechanism to collect law 

enforcement sensitive information in a nonpublic rulemaking docket that 

could be pertinent to making decisions regarding proposed changes. 

Regulatory changes instituted by FinCEN can affect the content or 

structure of BSA data used in law enforcement investigations as well as 

law enforcement’s efforts to indict and prosecute financial crimes. For 

example, in 2008 FinCEN developed a proposal to renumber the portion of 

Title 31 of the Code of Federal Regulations which encompasses the 

regulations promulgated under the BSA and the USA PATRIOT Act related 

to financial recordkeeping and reporting of currency and foreign 

transactions. In discussing the potential impact of this proposal, an official 

from one federal law enforcement agency with a mission that includes a 

focus on anti-money laundering stated that renumbering the regulations 

would have a detrimental effect on his agency’s day-to-day operations. 

Because the agency’s ongoing indictments and prosecutions of financial 

crimes are directly linked to very specific regulatory language outlined in 

the Title 31 regulations, he stated that renumbering these regulations 

would affect how his office and other federal law enforcement agencies 

document and track existing investigations. While FinCEN did 

communicate with some law enforcement customers about the proposed 

regulatory change, liaisons from two of FinCEN’s top five federal law 

enforcement customers told us that FinCEN did not solicit their input 

about the potential impact of the change to the Title 31 regulations on 

their operations before proceeding with plans to implement the regulatory 

change. Additionally, liaisons from four of FinCEN’s top five federal law 

enforcement customers reported concerns that their agencies do not have 

sufficient opportunities to provide input when FinCEN is considering 

proposed regulatory changes. 

FinCEN Has Taken Initial Steps 

to More Actively Solicit Law 

Enforcement Input on 

Proposed Regulatory Actions, 

but Lacks a Mechanism for 

Collecting Sensitive 

Information 

In February 2009, we reported on similar concerns regarding law 

enforcement’s opportunities to provide input to FinCEN on proposed 

revisions to Suspicious Activity Report (SAR) forms that institutions file 

with FinCEN when they detect known or suspected violations of laws or 

Page 26 GAO-10-141 Anti-Money Laundering
 

regulations.44 Specifically, we found that representatives from law 

enforcement agencies with liaisons located at FinCEN reported that they 

were not involved in identifying issues or concerns that could be 

addressed through revisions to the form for filing SAR data. The report 

noted that the SAR form contains information that is critical for 

investigations of money laundering, terrorist financing, and other financial 

crimes, so it is important that changes to this form be designed to collect 

the information that is most useful for law enforcement.45 In this report, we 

recommended that FinCEN further develop and document its strategy to 

fully incorporate best practices to help enhance and sustain collaboration 

among federal agencies in the form change process and distribute that 

documentation to all stakeholders. FinCEN officials noted that while the 

agency had taken steps to revise the forms change process, it generally 

agreed with GAO’s recommendation to further document and 

communicate the recently revised process in order to strengthen 

collaboration among all stakeholders. 

The internal report ALD generated in August 2008 recognized that changes 

to BSA regulations have the potential to alter the kind of information that 

financial institutions report as well as federal law enforcement agencies’ 

concerns that FinCEN does not generally engage them in the identification 

and resolution of regulatory issues that might influence law enforcement 

operations. The report further acknowledged law enforcement’s views that 

FinCEN typically reported planned regulatory changes to them after the 

changes were to be implemented rather than first seeking their input on 

the need for the changes or other possible solutions. Similarly, senior 

FinCEN officials told us that the agency recognizes the need to do a better 

job of obtaining law enforcement input on proposed regulatory changes in 

the future. 

In one recent case, FinCEN took steps to more actively solicit input from 

law enforcement on a proposed regulatory change. Specifically, in 

developing regulations in 2009 related to stored value cards such as 

 

44For more 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). 

45GAO reported that FinCEN had developed a new process for revising forms but, as it is 

currently outlined, the process may not achieve some potential benefits that could come 

from closer adherence to practices that can help enhance and sustain collaboration, such 

as greater consensus from all stakeholders on proposed SAR form revisions, and fuller 

documentation of the process. For more information, see GAO-09-226. 

Page 27 GAO-10-141 Anti-Money Laundering
 

prepaid debit cards and gifts cards, in addition to using the law 

enforcement roundtable to inform agencies about planned regulatory 

changes, FinCEN held multiple meetings with representatives from its top 

five federal law enforcement customers specifically designed to obtain 

their input and provide recommendations on developing the proposed 

regulation.46 FinCEN documented this input, provided law enforcement 

agencies with the opportunity to ensure that it had accurately captured 

their concerns, and asked them to further elaborate on issues identified as 

critical to address in developing the proposed regulation. FinCEN officials 

noted that a number of factors helped to facilitate its efforts to more 

effectively coordinate with law enforcement in this case. Specifically, 

legislation requires them to work in consultation with the Secretary of 

Homeland Security, to issue regulations implementing the BSA, regarding 

the sale, issuance, redemption, or international transport of stored value, 

including stored value cards.47 Similarly, FinCEN officials noted that they 

were able to coordinate their efforts with previously established working 

groups on stored value cards within the law enforcement community. 

FinCEN’s efforts to actively solicit law enforcement input in this case are 

encouraging, and continuing such efforts would help ensure that law 

enforcement input is considered before regulatory changes are made. 

Once FinCEN has decided to move forward with a proposed regulatory 

change, it follows the process laid out in the Administrative Procedure Act 

(APA) for obtaining official comments on the proposal from interested 

stakeholders including regulators, financial institutions, and law 

enforcement agencies. The act establishes three basic requirements for 

notice and comment rulemaking: (1) publication of a general notice of the 

proposed rule in the Federal Register, referred to as the notice of 

 

46Stored value cards are prepaid debit cards that use magnetic stripe technology to store 

information about funds that have been prepaid to the card. Payroll cards, government 

benefit cards, gift cards, and telephone cards are examples of stored value cards. Stored 

value cards often allow holders to transfer money values anonymously without being 

subject to the same controls required of institutions that deal with credit and debit cards. 

While there are many forms and uses of stored value cards in the marketplace, there are 

two main categories: (1) single-purpose or “closed-loop” cards, such as gift cards, which 

can only be used to purchase goods at particular retailers, or prepaid telephone cards, 

which can only be used to make telephone calls, and (2) multipurpose or “open-loop” 

cards, which can be used to make debit transactions at a wide variety of retail locations, as 

well as for other purposes, such as receiving direct deposits and withdrawing cash from 

ATMs. 

47Credit Card Accountability Responsibility and Disclosure Act of 2009, Pub. L. No. 111-24, 

§ 503, 123 Stat. 1734, 1756 (2009). 

Page 28 GAO-10-141 Anti-Money Laundering
 

proposed rulemaking (NPRM); (2) solicitation and acceptance of data and 

other information from the public in response to the NPRM; and 

(3) publication of the final rule.48 However, liaisons from four of FinCEN’s 

top five federal law enforcement customers reported that the public 

record is not always the most appropriate venue for providing comments 

on proposed regulatory changes because their comments often contain 

law enforcement sensitive information. According to these officials, 

raising these concerns in a public forum may compromise key 

investigative techniques or strategies used in ongoing investigations. While 

agencies generally publish a rulemaking docket that includes all relevant 

information and public comments pertaining to the development of the 

rule, some agencies have a process to exclude nonpublic information from 

this docket.49 This information can include, but is not limited to, law 

enforcement sensitive material that would disclose techniques or 

procedures for law enforcement investigations or prosecutions.50

According to FinCEN officials, FinCEN does not currently have a 

systematic process for soliciting law enforcement-sensitive comments on 

proposed regulatory changes in a nonpublic docket. The importance of 

stakeholder input in the process of proposing regulatory changes is well 

established—it is the basis for the public comment period in the NPRM 

 

48Generally, the APA is the principal law governing how agencies make rules. The APA 

prescribes uniform standards for rulemaking and most federal rules are promulgated using 

the APA-established informal rulemaking process, also known as “notice and comment” 

rulemaking. Generally, a notice of proposed rulemaking (NPRM) is published in the 

Federal Register announcing an agency’s intent to promulgate a rule to the public. The APA 

requires that the NPRM include a statement of the time, place, and nature of the public 

rulemaking proceedings, reference to the legal authority under which the rule is proposed, 

and the terms or substance of the proposed rule or a description of the subjects and issues 

involved. The NPRM also generally includes the timing and manner in which the public may 

comment on the proposed rule. E.O. 12866 states that most rulemakings should include a 

comment period of 60 days, and most agencies do provide a 60-day or longer comment 

period for complex or controversial rules. After issuance of the NPRM, agencies are 

generally required to place public comments as well as other supporting materials in a 

rulemaking docket which must be available for public inspection. 

49Some agencies have a specific regulatory provision that allows them to exclude from the 

public docket submitted information not subject to mandatory disclosure under the 

Freedom of Information Act. 5 U.S.C. § 552(b). (For example, 28 C.F.R. § 50.17 (d) 

(Department of Justice)). 

50Other information that is exempt from mandatory disclosure under the Freedom of 

Information Act includes, but is not limited to, certain trade secrets and commercial or 

financial information; personnel and medical files and similar files, the disclosure of which 

would constitute a clearly unwarranted invasion of personal privacy; certain records or 

information compiled for law enforcement purposes; and geological and geophysical 

information and data concerning wells. 

Page 29 GAO-10-141 Anti-Money Laundering
 

process. Establishing a mechanism to solicit law enforcement sensitive 

information as a part of this comment period could improve FinCEN’s 

efforts to receive important information necessary to making decisions 

about proposed regulatory changes. 

As technology has evolved and increasing numbers of law enforcement 

customers have gained direct access to BSA data, FinCEN has recognized 

the need to increase the production of more sophisticated complex 

analytic products. However, to maximize the benefits of this transition, 

FinCEN needs to have a clear understanding of what complex analytic 

products its law enforcement customers may need, as well as to keep 

them informed about key information regarding its process for selecting 

and developing these products. By providing clarification to law 

enforcement agencies about the various types of complex analytic 

products it can provide and establishing a process for informing law 

enforcement agencies about the availability of these products, FinCEN 

could help ensure that law enforcement agencies better understand and 

more fully utilize FinCEN’s products in support of their investigations, in 

order to better fulfill its mission. Moreover, FinCEN’s efforts to realign 

resources to better meet law enforcement’s needs through the 

reorganization of ALD and the development of a planning guide to improve 

communication with its law enforcement customers are positive steps. 

However, identifying the specific actions FinCEN plans to take in order to 

better assess law enforcement’s needs and to become more transparent to 

its law enforcement customers about the division’s operations will help 

FinCEN ensure that going forward, its operations are designed in such a 

way as to maximize the usefulness of its support to its law enforcement 

customers. 

Conclusions 

While FinCEN’s annual survey and feedback forms provide law 

enforcement with opportunities to give FinCEN feedback on some 

completed products, FinCEN could also benefit from soliciting input from 

law enforcement agencies regarding its selection or development of 

ongoing and planned complex analytic products. By actively working with 

its law enforcement customers to identify ways to improve 

communication, FinCEN could help ensure that as it continues to 

emphasize the production of these products, it is maximizing the relevance 

of these products to its law enforcement customers. ALD’s August 2008 

internal report recognizes the potential benefits of soliciting input from 

stakeholders in its law enforcement roundtable meetings on how FinCEN 

develops its analytic products. However, doing so before work is initiated 

and throughout the development process could help ensure that FinCEN is 

Page 30 GAO-10-141 Anti-Money Laundering
 

not only better informed of law enforcement agencies’ needs but is better 

able to take advantage of its law enforcement customers’ subject matter 

expertise in conducting its work. Finally, developing a mechanism to 

solicit law enforcement sensitive information as part of the public 

comment period for proposed regulatory changes could improve FinCEN’s 

efforts to receive important information necessary to make decisions 

about the implementation of these changes. 

To help ensure that FinCEN maximizes the relevance and usefulness of 

the support it provides, we recommend that the Director of FinCEN work 

in conjunction with its law enforcement customers to take the following 

four actions: 

• Clarify and communicate to law enforcement agencies the various types of 

complex analytic products FinCEN can provide and establish a process for 

informing law enforcement agencies about the availability of these 

products. 

• Complete a plan, including identifying the specific actions FinCEN will 

take, to better assess law enforcement needs, and make the division’s 

operations more transparent to FinCEN’s law enforcement customers. 

This plan should include a mechanism for FinCEN to communicate to law 

enforcement agencies its decision-making process for selecting complex 

analytic products to pursue and why FinCEN rejects a request. 

• Establish a systematic process for actively soliciting input from law 

enforcement agencies and incorporating this input into the selection and 

development of its analytic products. 

• Develop a mechanism to collect law enforcement sensitive information 

from law enforcement agencies during the public comment period of the 

NPRM process. 

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

Defense, Justice, Homeland Security, and the Treasury. On 

November 20, 2009, we received written comments from FinCEN, which 

are summarized below and reprinted in appendix II. The Department of 

Defense and the Department of Justice provided technical comments, 

which we incorporated into this report, where appropriate. On 

November 17, 2009, the audit liaison for the Department of Homeland 

Security stated that the department had no comments. In written 

comments on this report, the FinCEN Director stated that FinCEN 

concurred with GAO’s recommendations to improve communications and 

support to the law enforcement community. After receiving a copy of our 

draft report for comment, FinCEN provided us with additional information 

Recommendations for 

Executive Action 

Agency Comments 

and Our Evaluation 

Page 31 GAO-10-141 Anti-Money Laundering
 

documenting that it had reorganized ALD in order to realign resources to 

better meet law enforcement’s needs. The FinCEN Director noted that the 

realignment better positions the bureau to move forward with actions 

identified in the ALD internal report, along with the recommendations 

outlined in our report. As a result, we modified the recommendation 

language in our draft report to reflect the work that FinCEN had already 

done. 

With regard to our recommendation that FinCEN establish a process to 

inform law enforcement about the availability of completed products, 

FinCEN officials noted that they typically observe the “third-party rule” on 

dissemination of information obtained from the requesting agency and, in 

some cases, this may limit their ability to share products that are 

completed in response to a request from a single customer. The rule 

generally provides that information properly released by one agency to 

another agency cannot be released by the recipient agency to a third 

agency without prior knowledge and consent of the agency that originally 

provided the information. The third-party rule applies to all data and 

information FinCEN receives from the agencies with which it works on a 

specific project. However, officials further stated that they are committed 

to looking for ways to better publicize FinCEN’s analytic work and will 

continue to do so within the framework of adequately protecting the 

information provided to them. While we recognize the need for FinCEN to 

protect sensitive information, we believe that establishing a process to 

clarify and communicate to law enforcement when and under what 

circumstances FinCEN can or will attempt to share analytic products with 

other law enforcement customers will help ensure that it is effectively 

carrying out its mission to support the investigation and prosecution of 

financial crimes. 

We are sending copies of this report to interested congressional 

committees, the Secretary of the Treasury, the Director of FinCEN, and 

any other interested parties. In addition, this report also is available at no 

charge on GAO’s Web site at http://www.gao.gov. 

Page 32 GAO-10-141 Anti-Money Laundering
 

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

at (202) 512-8777, or larencee@gao.gov. Contact points for our Office of 

Congressional Relations and Public Affairs may be found on the last page 

Eileen Regen Larence 

of this report. Key contributors to this report are listed in appendix VI. 

Director, Homeland Security and Justice Issues 

Page 33 GAO-10-141 Anti-Money Laundering
Appendix I: List of Agencies GAO Surveyed Appendix I: List of Agencies GAO Surveyed 

Federal 

agency 

State 

agency 

One of FinCEN’s top 

five federal law 

enforcement 

customers 

1 U.S. Immigration and Customs Enforcement 9 9

2 Drug Enforcement Administration 9 9

3 Federal Bureau of Investigation 9 9

4 Internal Revenue Service—Criminal Investigation Division 9 9

5 U.S. Secret Service 9 9

6 Bureau of Alcohol, Tobacco, Firearms, and Explosives 9

7 U.S. Postal Inspection Service 9

8 U.S. Customs and Border Protection 9

9 Army Criminal Investigations Division 9

10 U.S. Attorneys Office—Eastern District of New York 9

11 Department of Justice—Asset Forfeiture and Money Laundering Section 9

12 U.S. Marshals Service 9

13 U.S. Air Force Office of Special Investigations 9

14 Defense Criminal Investigative Service 9

15 Naval Criminal Investigative Service 9

16 Ohio Bureau of Criminal Identification & Investigation 9

17 Arizona Department of Public Safety 9

18 California Department of Justice 9

19 Florida Department of Law Enforcement 9

20 Illinois State Police 9

21 Texas Department of Public Safety 9 

22 New Jersey Division of Criminal Justice 9

23 Virginia State Police 9

24 New York District Attorney 9

25 San Francisco High-Intensity Financial Crime Area (HIFCA) 

26 Chicago HIFCA 

27 Los Angeles HIFCA 

28 New York HIFCA 

29 Puerto Rico HIFCA 

Source: GAO. 

Page 34 GAO-10-141 Anti-Money Laundering 
Appendix II: Comments from the Department Appendix II: Comments from the Department of the Treasury 

of the Treasury 

Page 35 GAO-10-141 Anti-Money Laundering
Appendix II: Comments from the Department 

of the Treasury 

Ms. Eileen Larence 

November 20, 2009 Page 2 

contains sensitive information provided by the requesting agency. In these cases, we 

observe the “third party rule” on dissemination of information obtained from the 

requesting agency and, in some cases, this may limit our abilities to share products that are 

completed in response to a request from one of our customers. With that said, we are 

committed to constantly looking for ways to better publicize our analytical work and will 

continue to do so within the framework of our duty to adequately protect the information 

we are entrusted with. With regards to receiving law enforcement sensitive comments on 

regulatory proposals and including these comments in a non-public rulemaking docket, this 

is a concept we are looking into, and will pursue if it is legally and technically possible to 

do so while still meeting the overriding need to protect this sensitive information. 

Again, we appreciate GAO’s efforts to review FinCEN’s efforts to support law 

enforcement agencies, and look forward to updating you at a later date on the plans and 

progress towards the report’s recommendations. If you have any questions, please feel free 

to contact Nicholas Colucci, Associate Director, Analysis and Liaison Division, at 703-

905-5175. 

 Sincerely, 

 /s/ 

 James H. Freis, Jr. 

Page 36 GAO-10-141 Anti-Money Laundering
Appendix III: GAO

A

 Contact and Staff 

cknowledgments 

Page 37 GAO-10-141 

Appendix III: GAO Contact and Staff 

Acknowledgments 

Eileen Larence, (202) 512-8777 or larencee@gao.gov GAO Contact 

In addition to the contact named above, Kirk Kiester, Assistant Director; 

Samantha Carter; Miriam Hill; and Hugh Paquette made significant 

contributions to the work. David Alexander and George Quinn, Jr., 

assisted with design, methodology, and data analysis. Billy Commons and 

Jan Montgomery provided legal support. Linda Miller and Sally Williamson 

provided assistance in report preparation. 

Acknowledgments 

 Anti-Money Laundering 
Related GAO Products Related GAO Products 

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.: February 27, 2009. 

Bank Secrecy Act: Federal Agencies Should Take Action to Further 

Improve Coordination and Information-Sharing Efforts. GAO-09-227. 

Washington, D.C.: February 12, 2009. 

Information Security: Further Actions Needed to Address Risks to Bank 

Secrecy Act Data. GAO-09-195. Washington, D.C.: January 30, 2009. 

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.: September 30, 2008. 

Bank Secrecy Act: Increased Use of Exemption Provisions Could Reduce 

Currency Transaction Reporting While Maintaining Usefulness to Law 

Enforcement Efforts. GAO-08-355. Washington, D.C.: February 21, 2008. 

Bank Secrecy Act: Surveys of Financial Institutions and CTR Users, an 

E-supplement to GAO-08-355. GAO-08-385SP. Washington, D.C.: February 

21, 2008. 

Telecommunications: FCC Should Take Steps to Ensure Equal Access to 

Rulemaking Information. GAO-07-1046. Washington, D.C.: September 6, 

2007. 

Bank Secrecy Act: FinCEN and IRS Need to Improve and Better 

Coordinate Compliance and Data Management Efforts.GAO-07-212. 

Washington, D.C.: December 15, 2006. 

International Financial Crime: Treasury’s Roles and Responsibilities 

Relating to Selected Provisions of the USA PATRIOT Act. GAO-06-483. 

Washington, D.C.: May 12, 2006. 

Bank Secrecy Act: Opportunities Exist for FinCEN and the Banking 

Regulators to Further Strengthen the Framework for Consistent BSA 

Oversight. GAO-06-386. Washington, D.C.: April 28, 2006. 

Fisheries Management: Core Principles and a Strategic Approach Would 

Enhance Stakeholder Participation in Developing Quota-Based 

Programs. GAO-06-289. Washington, D.C.: February 23, 2006. 

Page 38 GAO-10-141 Anti-Money Laundering
Related GAO Products 

Federal Rulemaking: Past Reviews and Emerging Trends Suggest Issues 

That Merit Congressional Attention. GAO-06-228T. Washington, D.C. 

November 1, 2005. 

USA PATRIOT Act: Additional Guidance Could Improve Implementation 

of Regulations Related to Customer Identification and Information 

Sharing Procedures.GAO-05-412. Washington, D.C.: May 6, 2005. 

Standards for Internal Control in the Federal Government. 

GAO/AIMD-00-21.3.1. Washington, D.C.: November 1, 1999. 

Money Laundering: FinCEN’s Law Enforcement Support Role Is 

Evolving.GAO/GGD-98-117. Washington, D.C.: June 19, 1998. 

(440690) Page 39 GAO-10-141 Anti-Money Laundering
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