Financial Crimes Enforcement 

Network

FY 2013

President’s Budget

Submission
FinCEN - 2

Table of Contents

Section 1 – Purpose ....................................................................................................................... 3

1A – Mission Statement.............................................................................................................. 3

1.1 – Appropriations Detail Table .............................................................................................. 3

1B – Mission Priorities and Context........................................................................................... 3

Section 2 – Budget Adjustments and Appropriation Language............................................... 6

2.1 – Budget Adjustments Table................................................................................................. 6

2A – Budget Increases and Decreases Description..................................................................... 6

2.2 – Operating Levels Table.................................................................................................... 10

2B – Appropriations Language and Explanation of Changes................................................... 11

2C – Legislative Proposals........................................................................................................ 11

Section 3 – Budget and Performance Report and Plan........................................................... 13

3A – BSA Administration and Analysis................................................................................... 13

3.1.1 – BSA Administration and Analysis Budget and Performance Report and Plan ............ 16

3B – Regulatory Support Programs.......................................................................................... 17

3.1.2 – Regulatory Support Programs Budget and Performance Report and Plan ................... 17

Section 4 – Supplemental Information...................................................................................... 18

4A – Capital Investment Strategy............................................................................................. 18
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Section 1 – Purpose

1A – Mission Statement

To enhance the integrity of financial systems by facilitating the detection and deterrence of 

financial crime.

1.1 – Appropriations Detail Table

Dollars in Thousands

FY 2011 FY 2012 FY 2013 % Change

Resources Available for Obligation Enacted Enacted Request FY 2012 to FY 2013

FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

New Appropriated Resources:

 BSA Administration and Analysis 327 $101,491 327 $110,788 322 $102,407 -1.53% -7.56%

 Regulatory Support Programs - 9,297 - - - - 0.00% 0.00%

Subtotal New Appropriated Resources 327 $110,788 327 $110,788 322 $102,407 -1.53% -7.56%

Other Resources:

 Reimbursables 1 $20,000 1 $3,000 1 $3,000 0.00% 0.00%

 Recovery from Prior Years - 500 - 500 - 500 0.00% 0.00%

 Unobligated Balances from PY - 25,420 - 20,000 - 20,000 0.00% 0.00%

Subtotal Other Resources 1 $45,920 1 $23,500 1 $23,500 0.00% 0.00%

Total Resources Available for Obligation 328 $156,708 328 $134,288 323 $125,907 -1.52% -6.24%

1B – Mission Priorities and Context

The Financial Crimes Enforcement Network (FinCEN), a Treasury bureau reporting to the Under 

Secretary for Terrorism and Financial Intelligence, plays a key role in supporting the 

Department’s strategic goal to “protect our national security through targeted financial actions.”

This role includes ensuring safer and more transparent U.S. and international financial systems 

through the administration of the Bank Secrecy Act (BSA). FinCEN furnishes analytical and 

financial expertise to support law enforcement investigations and prosecutions and to determine 

emerging trends in money laundering and other financial crimes. FinCEN also serves as the 

nation’s financial intelligence unit (FIU). An FIU serves as a national center to collect, analyze, 

disseminate, and exchange information pursuant to a country’s anti-money laundering/counterterrorist financing (AML/CFT) legislation and regulations. 

FinCEN’s activities and efforts are developed in coordination with federal, state, and 

international partners. These efforts are linked to the following bureau strategic goals: 

 Financial systems are more transparent and resistant to financial crime; 

 Analysis and information sharing contribute to the detection and deterrence of 

financial crime; and 

 Financial reporting and data are useful, comprehensive, and secure. 

In this environment of declining resources, FinCEN is uniquely positioned at the intersection of 

financial industry, regulators, law enforcement agencies, and global partners. FinCEN is able to 

network these different perspectives to bring comprehensive insights to the detection and 

deterrence of financial crime. This unique position allows FinCEN to develop and support 

multiple partnerships that have a broad national and international impact.

FinCEN’s accomplishments in FY 2011 include: 
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 Enhanced collaboration with law enforcement to identify sources of lead information, 

developed analysis criteria to more effectively leverage BSA data to identify potential 

non-compliant institutions, strengthened relationships with state regulators and 

enhanced effectiveness of examinations through greater engagement with and 

coordination of IRS and state efforts. This strategy has assisted FinCEN in taking 

action against money transmitters that have failed to register with FinCEN as well as 

against other non-compliant institutions, as warranted; 

 Continued participation in the U.S. Government’s coordinated attack on mortgage 

fraud by updating analyses of Suspicious Activity Reports (SARs) and issuing 

financial institution advisories to highlight current trends in residential and 

commercial mortgage loan fraud, and in loan modification and foreclosure rescue 

scams; 

 Support for federal law enforcement efforts to combat health care fraud (HCF) by 

initiating an advanced targeting process to identify potential health care fraud 

perpetrators and to provide analytical support to investigations and prosecutions. 

This included work with several of the multi-agency Health Care Fraud Prevention 

and Enforcement Action Teams, participation in HCF related conferences/training 

sessions, and expansion of analytical support efforts to additional federal, state and 

local law enforcement agencies; 

 Creation and dissemination of a large number of tactical financial intelligence reports 

to Egmont Group FIUs and managed case exchange with FIUs on behalf of U.S. law 

enforcement and regulatory agencies. These intelligence products are integral to 

domestic and foreign investigations of money laundering, financial fraud, and 

terrorist financing around the world; and 

 Two releases of functionality through the deployment of a new, advanced analytical 

tool on the current technical platform to the FinCEN analysts as part of the BSA IT 

Modernization Program. In support of Treasury’s Data Center Consolidation efforts, 

FinCEN worked with the Bureau of Public Debt to establish the first iteration of the 

modernized Production and Disaster Recovery environment. FinCEN also completed 

an initial, limited deployment of the new Registered User Portal, which will 

eventually serve as the entryway to all BSA programs and tools to the user 

community. 

FY 2013 Priorities 

In FY 2013, FinCEN’s priorities are to: 

 Support the Presidential goal of encouraging economic growth by safeguarding the 

financial systems from abuse and promoting transparency in the U.S. and 

international financial systems; 

 Enhance BSA regulatory compliance and enforcement through increased reliance on 

state regulatory agencies, strengthened relationships with law enforcement, and 

implementation of compliance strategies for newly regulated industries; 

 Lead efforts to coordinate federal, state, and local efforts to combat fraud; 

 Engage with priority countries and international bodies to strengthen mechanisms for 

global information exchange; and 
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 Efficiently manage the collection, processing, and retrieval of BSA data under the 

BSA IT Modernization program. 

In order to achieve its priorities and continue to advance its strategic goals, FinCEN will improve 

its ability to strengthen financial system security and enhance U.S. national security. It will 

continue to ensure that financial systems are resistant to abuse and continue to develop analytical 

products and services to support law enforcement activities. To deter financial fraud and ensure 

the security of financial systems, FinCEN will: 

 Continue to enhance proactive BSA compliance and enforcement through stronger 

relationships with state regulatory agencies, greater communication with law 

enforcement, strengthened analytics, and development of compliance strategies for 

newly regulated sectors; 

 Continue to advance regulatory initiatives designed to further protect the U.S. 

financial system from abuse while balancing their impact on the financial industry. 

This would include carefully considering public comment on and weighing changes 

to proposed rules as appropriate; 

 Expand and leverage law enforcement and private sector contacts in the Southwest 

Border and in other high threat jurisdictions for the purpose of developing and 

sharing real-time or actionable intelligence on related money laundering patterns, 

trends, and methods; 

 Support law enforcement efforts to combat illicit activities through the fusion of 

investigative data with the BSA to provide complex analytical products that advance 

investigations and prosecutions; 

 Expand joint analytical projects with foreign FIUs, particularly in the areas of 

proactive and strategic analysis. Just as FinCEN receives BSA reports, each FIU 

receives domestic reporting on financial activity. By working together, FinCEN and 

foreign FIUs can find connections in data streams relating to suspicious activity that 

otherwise would not be found; 

 Continue to deploy modernized BSA information management and query/analysis 

capabilities to FinCEN analysts, law enforcement customers, and financial industry 

regulators to facilitate decision-making, increase the value of BSA information 

through increased data integrity and improved query/analytical tools, and move 

Treasury to the ultimate goal of being a “paperless” agency by mandating that BSA 

information is filed electronically. FinCEN will also begin working on the system 

design to accommodate the collection of cross border electronic funds transfer 

information; and 

 Incorporate common requirements identified by law enforcement and regulatory 

agencies into the BSA IT Modernization project, which will be operational in FY 

2013. These common requirements mitigate duplication of effort by these agencies 

further downstream. FinCEN will also seek to leverage the new IT capabilities to 

enhance longstanding efforts to help coordinate among various federal, state and local 

agencies that might be investigating related subjects or similar types of financial 

crime.
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Section 2 – Budget Adjustments and Appropriation Language

2.1 – Budget Adjustments Table

Dollars in Thousands 

Financial Crimes Enforcement Network FTE Amount

FY 2012 Enacted 327 $110,788

Changes to Base:

Adjustment to Request: 8 $0

Adjustment for Transitioned BSA Collection and Processing Activities 8 $0

Maintaining Current Levels (MCLs): - $930

Maintaining Current Levels - $930

Efficiency Savings: (14) ($6,232)

Eliminate IT Legacy Systems - ($3,047)

Administrative Staffing Efficiencies (14) ($2,168)

Regulatory Efficiency Savings - ($1,017)

Subtotal FY 2013 Changes to Base (6) ($5,302)

Total FY 2013 Base 321 $105,486

Program Changes:

Program Decreases: (23) ($9,871)

Redirect IRS Reimbursement for BSA Compliance - ($5,925)

Reduce Intelligence Support to External Agencies (6) ($968)

Reduce Field Law Enforcement Support (3) ($683)

Program Staff Attrition (14) ($2,295)

Reinvestments: 24 $6,792

BSA Collection Processing and Retrieval Functions from IRS 

Reimbursement

12 $2,675

Improve Industry Compliance and Enforcement from IRS Reimbursement 12 $2,525

Cross Border System from IT Legacy System - $1,592

Total FY 2013 Request 322 $102,407

2A – Budget Increases and Decreases Description

Adjustment to Request ...........................................................................................+$0 / +8 FTE

Adjustment for Transitioned BSA Collection and Processing Activities +$0 / +8 FTE 

FinCEN will begin in FY 2012 to implement the transition of BSA collection and processing 

activities that have been previously performed by the IRS. Going forward, FinCEN will be 

responsible for BSA collection and processing, in conjunction with FinCEN’s BSA IT 

Modernization. With this FTE adjustment, FinCEN will begin the consolidation of caller 

inquiries previously fielded by the IRS. FinCEN anticipates an increased call volume due to the

implementation of the new unified BSA forms and mandated electronic filing. These activities 

are funded by redirecting $1,725,000 previously reimbursed to IRS since FY 2001 for data entry 

and related support for money services business (MSB) registration and suspicious activity 

reporting.

Maintaining Current Levels (MCLs) .........................................................+$930,000 / +0 FTE

Funds are requested for inflation adjustments (1.7 percent) in non-labor expenses such as GSA 

rent adjustments, postage, supplies and equipment and health benefits and the increase in Federal 

Employees Retirement System participation. Funds are also requested for the proposed 2013 pay 

raise (0.5 percent).
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Efficiency Savings .....................................................................................-$6,232,000 / -14 FTE

Eliminate IT Legacy Systems -$3,047,000 / +0 FTE 

This eliminates funding to maintain the legacy Secure Outreach and BSA E-Filing Systems. In 

FY 2012 and FY 2013, FinCEN will roll out new capabilities for the collection, processing and 

analysis of BSA data as part of its IT Modernization. 

Administrative Staffing Efficiencies -$2,168,000 / -14 FTE 

These staffing efficiencies will be achieved through absorption of workload associated with 

positions lost through attrition and using a cross service provider, where cost effective. 

Regulatory Efficiency Savings -$1,017,000 / +0 FTE 

FinCEN will achieve efficiency savings through targeted regulatory support efforts, 

centralization of MSB outreach activities, and change in distribution methodology for MSB 

brochure materials. The impact of these reductions will be mitigated through future 

consolidation of call centers; centralization of outreach activities; additional outreach support by 

FinCEN staff; and greater reliance on FinCEN’s public website to distribute MSB materials, 

supporting Treasury’s paperless initiative.

Program Decreases ...................................................................................-$9,871,000 / -23 FTE

Redirect IRS Reimbursement for BSA Compliance -$5,925,000 / +0 FTE 

This decrease will redirect funding provided to the IRS for BSA compliance by FinCEN to carry 

out some delegated examinations for compliance with FinCEN regulations. Activities in support 

of BSA compliance are currently funded primarily through IRS direct appropriations. However,

FinCEN also provides funding through an annual reimbursement to the IRS. As background, 

FinCEN delegated examination responsibility to federal financial regulators and to the IRS for 

compliance examination of financial institutions subject to BSA requirements that do not have a 

federal regulator. The financial institutions currently subject to examination by the IRS include 

MSBs; casinos; insurance companies; dealers in precious metals, precious stones, and jewels;

operators of credit card systems; and certain non-federally regulated depository institutions.

Collectively, these institutions generally are referred to as non-bank financial institutions 

(NBFIs). The supplemental funding provided by FinCEN began in FY 2001 when the MSB 

reporting requirements were expanded to include registration and suspicious activity reporting. 

Over the last 12 years, the BSA compliance examination program has evolved, along with the

IRS’s direct appropriation and organization structure for BSA compliance. FinCEN’s FY 2013

legislative proposals would allow FinCEN to rely on one or more financial supervisors in each of 

the states to carry out BSA compliance examinations for their respective regulated institutions, 

including NBFIs. Collectively, these factors have changed the overall environment.

Reduce Intelligence Support to External Agencies -$968,000 / -6 FTE 

This decrease will reduce analytical support to external customers in support of their national 

security, counter terrorism financing, and law enforcement matters. FinCEN will continue to 

carry-out limited case support and support to FinCEN's analytical initiatives that require national 

security information. FinCEN will also provide access to BSA information for some external 

agencies through appropriate information sharing protocols.
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Reduce Field Law Enforcement Support -$683,000 / -3 FTE 

Reductions are identified from discontinuance of a liaison position at the Federal Law 

Enforcement Training Center (FLETC), and from decreases in field positions located in High 

Intensity Financial Crime Areas (HIFCAs). FinCEN will continue to support law enforcement 

from its headquarters. FinCEN will continue to carry out limited case support and support 

FinCEN's analytical initiatives that require national security information.

Program Staff Attrition -$2,295,000 / -14 FTE 

This reduction will be taken across several FinCEN program areas. FinCEN will evaluate open 

positions for possible absorption of workload associated with positions lost through attrition.

Reinvestments ..........................................................................................+$6,792,000 / +24 FTE

BSA Collection Processing and Retrieval Functions from IRS Reimbursement +$2,675,000 / +12 

FTE 

This reinvestment is needed to continue the transition of BSA collection and processing activities 

started in FY 2012 from the IRS to FinCEN. The BSA IT Modernization program provides the 

technology structure to allow FinCEN to mandate BSA E-filing. This new technology and the 

movement to unified Currency Transaction Report (CTR) and SAR forms for all types of 

financial institutions will eliminate most of the current BSA paper processing activities currently 

performed on FinCEN’s behalf by the IRS. These changes necessitate consolidation and transfer 

of remaining activities to FinCEN to provide an efficient structure for responding to filer and 

caller inquires related to BSA forms submission (except Foreign Bank and Financial Accounts 

(FBAR) and Form 8300 inquiries, for which IRS will retain responsibility due to its Title 26 tax 

implications). This consolidation is consistent with FinCEN’s regulatory role as administrator of 

the BSA. In addition to eight FTE hired in FY 2012 outlined above, an additional $2,675,000 is 

needed to complete this transfer and consolidation of functions which will be the responsibility 

of FinCEN going forward. These remaining activities include completion of efforts to 

consolidate caller inquiries related to BSA forms submission; filer error communications; forms 

suppression and mass correction requests; and coordinating BSA forms certification (for law 

enforcement) and court testimony requests. 

Improve Industry Compliance and Enforcement from IRS Reimbursement +$2,525,000 / +12 

FTE 

This reinvestment will allow FinCEN to better carry out its responsibilities to coordinate BSA 

compliance among all financial supervisory agencies exercising delegated examination authority, 

as well as state supervisory agencies and the IRS. Several changes have prompted FinCEN’s 

need and ability to better coordinate NBFI compliance examinations. First, the number of NBFIs 

has increased over the last decade with the implementation of BSA requirements for additional 

industries and additional sectors expected to come under regulatory requirements in FY 2012.

Second, the enhanced analytic capabilities provided by the BSA IT Modernization will enable a 

more risk-based examination schedule and a more consistent and centralized approach to 

compliance across different industries. Third, legislative proposals in FinCEN’s FY 2013 budget 

provide authority to rely on examinations conducted by state regulators for NBFIs lacking a 

federal regulator. FinCEN seeks to build upon the success of the BSA/Anti-Money Laundering 

(AML) examination manual developed in conjunction with the federal banking agencies to 
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develop more consistent examination procedures for other regulated sectors. FinCEN, the IRS, 

and state examiners have benefitted from more coordination and FinCEN’s participation on 

examinations. FinCEN intends to continue along these lines and would increase reliance on state 

examinations in states with laws consistent with BSA requirements, allowing for better targeting 

of IRS and FinCEN resources on areas of greater risk, including those NBFIs not overseen by an 

empowered state regulator. This reinvestment will allow FinCEN to build upon previous success 

to improve BSA compliance examinations performed by the IRS and state examiners, and enable 

a more risk-based approach to examinations. Ninety-two percent of financial regulators rated the 

information exchange as valuable in FY 2011, which is an improvement from 86 percent in FY 

2010. FinCEN attributes this increase in performance to better coordination of BSA compliance 

activities.

Cross Border System from IT Legacy System +$1,592,000 / +0 FTE

This reinvestment will fund operations and maintenance support for the foundational 

infrastructure that captures cross border electronic funds transfer information (CBEFT). CBEFT

requirements and solutions have evolved since the funding started in FY 2008. As reflected in 

the proposed rulemaking published in September 2010 which was based on discussions with the 

IRS, taxpayer identification numbers must now be reported under the rule. 
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2.2 – Operating Levels Table

Dollars in thousands

 FY 2011 FY 2012 FY 2013

 Actual President's Enacted Proposed Proposed Request

Financial Crimes Enforcement Network Budget Reprogra Operating

 mmings Level

FTE 314 304 327 0 327 322

Object Classification

11.1 - Full-time permanent 35,032 34,314 37,130 0 37,130 35,944

11.3 - Other than full-time permanent 391 287 304 0 304 304

11.5 - Other personnel compensation 1,157 526 564 0 564 564

11.9 Personnel Compensation (Total) $36,580 $35,127 $37,998 $0 $37,998 $36,812

12 - Personnel benefits 9,963 8,986 9,597 0 9,597 9,412

21 - Travel and transportation of persons 836 758 844 0 844 825

22 - Transportation of things 45 0 0 0 0 0

23.1 - Rental payments to GSA 5,090 5,424 5,379 0 5,379 5,851

23.2 - Rental payments to others 105 71 71 0 71 72

23.3 - Communication, utilities, and misc charges 1,252 1,313 1,415 0 1,415 1,423

24 - Printing and reproduction 267 263 459 0 459 513

25.1 - Advisory and assistance services 8,338 1,865 1,849 0 1,849 1,866

25.2 - Other services 6,856 7,969 13,064 0 13,064 24,066

25.3 - Other purchases of goods and services from Govt. accounts 13,985 14,415 14,595 0 14,595 6,628

25.4 - Operation and maintenance of facilities 0 0 737 0 737 737

25.6 - Medical care 167 158 156 0 156 174

25.7 - Operation and maintenance of equip 7,401 5,166 5,118 0 5,118 5,452

25.8 - Subsistence and support of persons 4 0 0 0 0 0

26 - Supplies and materials 230 431 450 0 450 448

31 - Equipment 13,766 2,351 19,056 0 19,056 8,128

32 - Land and structures 307 0 0 0 0 0

Total Budget Authority $105,192 $84,297 $110,788 $0 $110,788 $102,407

Budget Activities:

BSA Administration and Analysis 95,930 114,297 110,788 0 110,788 102,407

Regulatory Support Programs 9,262 0 0 0 0 0

Total Budget Authority $105,192 $114,297 $110,788 $0 $110,788 $102,407
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2B – Appropriations Language and Explanation of Changes

Appropriations Language Explanation of Changes

DEPARTMENT OF THE TREASURY

FINANCIAL CRIMES ENFORCEMENT NETWORK

Federal Funds

SALARIES AND EXPENSES:

For necessary expenses of the Financial Crimes Enforcement 

Network, including hire of passenger motor vehicles; travel and 

training expenses[, including for course development,] of nonFederal and foreign government personnel to attend meetings 

and training concerned with domestic and foreign financial 

intelligence activities, law enforcement, and financial regulation; 

not to exceed $14,000 for official reception and representation 

expenses; and for assistance to Federal law enforcement 

agencies, with or without reimbursement, [$110,788,000]

$102,407,000, of which not to exceed $34,335,000 shall remain 

available until September 30, [2014] 2015: Provided, that funds 

appropriated in this account may be used to procure personal 

services contracts. (Department of the Treasury Appropriations 

Act, 2012.)

2C – Legislative Proposals

FinCEN is proposing three technical amendments to Titles 31 and 12 that would make 

improvements in two important areas. The first and second amendments provide authority to 

rely on examinations conducted by state supervisory agencies for nonbank financial institutions 

lacking a federal regulator, which would capture most nonbank financial institutions currently 

subject to Internal Revenue Service (IRS) examination as delegated through a memorandum of 

understanding (MOU). The third amendment increases information sharing between FinCEN 

and counterpart anti-money laundering/counter-terrorist financing regulators. Specifically, this 

amendment provides consistency between how FinCEN shares information in its capacity as a 

regulator and information sharing that currently exists between federal financial regulators and 

their foreign counterparts. The specific changes to the amendment language are outlined below.

Sec. 116. Section 5318(a)(1) of Title 31, United States Code (relating to compliance, 

exemptions, and summons authority), is amended by - (1) Inserting after "appropriate" "federal 

or (in the case of financial institutions without a federal supervisor) state"; and (2) Inserting 

after "Service." , "In lieu of delegating such authority to a state supervisory agency, the 

Secretary is also authorized to rely on examinations conducted by a state supervisory agency of 

a category of financial institution. The Secretary may only rely on such state examinations if the 

Secretary determines that under the laws of the state, the category of financial institution is 

required to comply with this subchapter and regulations prescribed under this subchapter, or the 

state supervisory agency is authorized to ensure that the category of financial institution 

complies with this subchapter and regulations prescribed under this subchapter."
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Sec. 117. Public Law 91-508, as amended (12 U.S.C. 1958 et seq.) is amended in section 128, by 

(1) Striking "sections 1730d (1) and" inserting in lieu thereof “section”; (2) Striking "bank 

supervisory agency, or other"; (3) Inserting after "appropriate" , "federal or (in the case of 

financial institutions without a federal supervisor) state"; and (4) Inserting after "agency." "In 

lieu of delegating such responsibility to a state supervisory agency, the Secretary is also 

authorized to rely on examinations conducted by a state supervisory agency of a category of 

financial institution. The Secretary may only rely on such state examinations if the Secretary 

determines that under the laws of the state, the category of financial institution is required to 

comply with this chapter and section 1829b (and regulations prescribed under this chapter and 

section 1829b), or the state supervisory agency is authorized to ensure that the category of 

financial institution complies with this chapter and section 1829b (and regulations prescribed 

under this chapter and section 1829b)."

Sec. 118. Section 310(b)(2)(E) of Title 31, United States Code (relating to the Financial Crimes 

Enforcement Network), is amended by inserting after "Federal" the first time that it appears, 

"and foreign".
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Section 3 – Budget and Performance Report and Plan

3A – BSA Administration and Analysis

($102,407,000 from direct appropriations, and $3,000,000 from reimbursable resources): 

The programs funded by this budget activity support the Treasury strategic goal to protect our 

national security through targeted financial actions. This activity comprises FinCEN’s efforts to 

administer the BSA, including promulgating regulations; providing outreach and issuing 

guidance to the regulated industries; providing oversight of BSA compliance; initiating 

enforcement actions; and managing the information reported by the regulated industries, as well 

as BSA compliance of non-bank financial institutions. 

Analytical programs include support to U.S. law enforcement and international FIUs in 

combating financial fraud and crime by facilitating the exchange of investigative information, 

including with foreign counterpart FIUs; identifying foreign and domestic financial fraud, money 

laundering, and terrorist financing trends, patterns, and techniques; and liaison with and support 

of intelligence initiatives within the intelligence community and within Treasury. This activity 

also incorporates efforts to support large-scale, complex law enforcement investigations 

involving financial fraud, terrorist financing, money laundering, and other financial crimes. 

As administrator of the BSA, FinCEN must ensure the effective management, accessibility, 

dissemination, and use of the highly sensitive confidential information collected under the Act.

FinCEN provides authorized law enforcement, regulatory, and intelligence agencies direct access 

to BSA information. 

Global programs include support to international initiatives to educate other jurisdictions about 

the BSA regulatory regime; work to establish international anti-money laundering/counterterrorist financing regulatory standards and norms; and efforts to improve the expertise and 

capabilities of personnel with anti-money laundering/counter-terrorist financing missions. 

Other Resources: Offsetting collections and reimbursements totaling $3,000,000 are collected 

from other agencies, including the Department of State for assistance to international partners, 

the Department of Defense for support of U.S. efforts in Afghanistan, and the Treasury 

Executive Office of Asset Forfeiture for projects to better support law enforcement. The goal 

owner for this budget activity is the Director of FinCEN, James H. Freis, Jr.
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Description of Performance:

In the regulatory area, FinCEN surveys its compliance MOU holders to determine the impact of 

the information exchange to improve the consistency and compliance of the financial system 

with FinCEN’s regulations implementing the BSA. In FY 2011, FinCEN met its target of 86 

percent with 92 percent rating the information exchange valuable. FinCEN attributes a portion 

of this success to enhancements made to the products prepared for the state regulators. In FY 

2013, the target is 88 percent. To meet future targets, FinCEN must continue to effectively 

support regulatory partners. FinCEN has proposed legislative amendments to allow for reliance 

on examinations conducted by a state supervisory agency for categories of institutions not 

subject to a federal regulator. If implemented, this statutory amendment could expand FinCEN’s 

relationship with state regulatory agencies. 

FinCEN’s goal to provide financial institutions with understandable guidance is critical to 

institutions establishing anti-money laundering programs that comply with FinCEN’s 

regulations. Understandable guidance will also contribute to protecting financial institutions and 

their customers from financial crime. In FY 2011, FinCEN’s goal was to maintain a 90 percent 

satisfaction level, and FinCEN met its target with 92 percent. FinCEN attained this success by 

responding timely (within 24 hours of the inquiry) and providing a high level of service. In FY 

2013, the target is to maintain 90 percent. Factors potentially affecting FinCEN’s ability to 

achieve this goal include the planned centralization within FinCEN of outreach activities and call 

center and operational functions currently performed by IRS; additional outreach support for new 

industries as a result of FinCEN’s ongoing regulatory and informational initiatives; possible 

increased call volume concerning the mandated e-filing proposal; and expected increases in 

inquiries associated with FinCEN initiatives involving IT modernization and increased 

communication to the MSB industry. 

In the analytical area, FinCEN supports domestic law enforcement and international FIU partners 

by providing analyses of BSA information and measures the percentage of customers finding 

FinCEN’s analytic reports highly valuable. In FY 2011, FinCEN discontinued the “percentage 

of domestic law enforcement and foreign financial intelligence units finding FinCEN's analytic 

reports highly valuable” and replaced it with two performance measures based on customer 

served, domestic law enforcement and foreign FIU customers. Breaking the measure out will 

enable FinCEN to better assess its performance and focus on the distinct needs of its domestic 

law enforcement and foreign FIU customers. The two measures closely tie to how BSA 

information is used by law enforcement and foreign FIUs to identify, investigate, and prevent 

abuse of the financial system.

The first measure looks at the value provided to the domestic law enforcement community. In 

FY 2010, FinCEN baselined this performance measure with 80 percent rating the analytic 

products as valuable. In FY 2011, 86 percent of the domestic law enforcement respondents rated 

the analytic products as valuable. FinCEN attributes this performance to its focus on increased 

communication with law enforcement partners; case support where FinCEN could add value to 

investigative efforts; and products and services developed to meet the needs of its customers.

The FY 2013 target is to maintain a level of 80 percent. Once FinCEN has three years of trend 

data, future targets will be adjusted accordingly. 
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The second measure tracks the value of the analytic reports to foreign FIU customers. In FY 

2010, FinCEN set a baseline for this measure of 90 percent. In FY 2011, 92 percent of foreign 

FIUs rated the analytic products as valuable. FinCEN attributes FIUs’ high satisfaction with its 

analytical reports primarily to the quality, quantity, and timeliness of information provided. 

FinCEN’s response time to FIU requests decreased from 41 days in FY 2009 to 32 days in FY 

2011, approaching the Egmont Group goal of 30 days. FinCEN’s bilateral and multilateral 

international liaison work enhances the sharing of information while building stronger 

relationships with foreign FIUs. In FY 2013, FinCEN has set a target level of 90 percent. Once 

FinCEN has three years of trend data, future targets will be adjusted accordingly.

In the efficient management, safeguarding, and use of BSA information, FinCEN began tracking 

the value of the BSA information to law enforcement and regulatory agency users with direct 

access to the BSA data. This is a composite measure compiled from survey results. The survey 

looks at the value of BSA data, such as whether the data provided unknown information, 

supplemented or expanded known information, verified information, helped identify new leads, 

opened a new investigation or examination, supported an existing investigation or examination, 

and provided information for an investigative or examination report. The FY 2011 actual for the 

percentage of customers finding the BSA data provides valuable information towards the 

detection and deterrence of financial crime was 89 percent, surpassing FinCEN’s target of 86 

percent. FinCEN attributes this performance to its efforts to ensure BSA information collected 

has a high degree of usefulness for criminal, tax, or regulatory purposes. FinCEN also provides 

training and access programs, which are designed to ensure understanding of the value of the 

data and maximize its utilization. The FY 2013 target is 90 percent. The modernized technical 

environment aims to further enhance the performance of this measure by maximizing data 

integrity and providing more robust and flexible query tools. The new BSA technical foundation 

will provide additional data quality checks and validations and more feedback to the filing 

community to continue FinCEN’s goal of improving the quality of information. Once FinCEN 

has three years of trend data, future targets will be adjusted accordingly. 

 
FinCEN - 16

3.1.1 – BSA Administration and Analysis Budget and Performance Report and Plan

Dollars in Thousands 

BSA Administration and Analysis Budget Activity

Resource Level FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013

Enacted Enacted Enacted Enacted Enacted Enacted Enacted Request

 Appropriated Resources $64,458 $64,780 $76,889 $82,287 $101,694 $101,491 $110,788 $102,407

 Reimbursable Resources $4,473 $1,541 $1,541 $6,000 $20,000 $20,000 $3,000 $3,000

Total Resources $68,931 $66,321 $78,430 $88,287 $121,694 $121,491 $113,788 $105,407

Budget Activity Total $68,931 $66,321 $78,430 $88,287 $121,694 $121,491 $113,788 $105,407

Measure FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013

Actual Actual Actual Actual Actual Actual Target Target

Percentage of customers 

finding the FinCEN data 

provides valuable information 

towards the detection and 

deterrence of financial crime

N/A N/A N/A N/A 87.0 89.0 86.0 90.0

Percentage of domestic law 

enforcement finding FinCEN's 

analytic reports contribute to 

the detection and deterrence 

of financial crime

N/A N/A N/A N/A 80.0 86.0 80.0 80.0

Percentage of financial 

regulators finding information 

exchanged with FinCEN 

under MOUs valuable to 

improve BSA consistency and 

compliance

N/A N/A 64.0 82.0 86.0 92.0 88.0 88.0

Percentage of foreign FIUs 

finding FinCEN's analytic 

reports provide valuable 

information towards the 

detection and deterrence of 

financial crime

N/A N/A N/A N/A 90.0 92.0 90.0 90.0

Percentage of regulatory 

helpline customers 

understanding BSA guidance

94.0 91.0 94.0 94.0 92.0 92.0 90.0 90.0

Key: DISC - Discontinued and B - Baseline
FinCEN - 17

3B – Regulatory Support Programs

($0 from direct appropriations): 

This budget activity was eliminated in FY 2012.

3.1.2 – Regulatory Support Programs Budget and Performance Report and Plan

Dollars in Thousands 

Regulatory Support Programs Budget Activity

Resource Level FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013

Enacted Enacted Enacted Enacted Enacted Enacted Enacted Request

 Appropriated Resources $8,436 $8,436 $8,955 $9,178 $9,316 $9,297 $0 $0

Total Resources $8,436 $8,436 $8,955 $9,178 $9,316 $9,297 $0 $0

Budget Activity Total $8,436 $8,436 $8,955 $9,178 $9,316 $9,297 $0 $0

Detailed information about each performance measure, including definition, verification and 

validation is available.
FinCEN - 18

Section 4 – Supplemental Information

4A – Capital Investment Strategy

As the administrator of the BSA, FinCEN receives valuable information reported and collected 

under BSA requirements, which totaled approximately 17 million filings in FY 2010. The 

bureau's mission is to enhance the integrity of financial systems by facilitating the detection and 

deterrence of financial crime. FinCEN's mission supports Treasury's strategic goal to protect our 

national security through targeted financial actions. To successfully fulfill its mission, FinCEN 

relies on secure, advanced information technology (IT) to manage the collection, processing, 

storage, and dissemination of BSA information that contributes to the soundness and confidence 

in America's financial system.

FinCEN's IT strategy takes into account the growing need for financial institutions to meet 

obligations as efficiently as possible, while ensuring that FinCEN and law enforcement agencies 

receive accurate, timely, and reliable BSA information to track money trails, identify money 

laundering, and unravel terrorist financing networks. FinCEN's IT strategy focuses on the 

critical need to improve the quality and accessibility of its data and increase responsiveness to 

stakeholders by introducing flexible and innovative technical solutions.

A major component of FinCEN's IT strategy is the bureau's information technology 

modernization vision and strategy (IT MV&S) and resulting enterprise transition strategy. IT 

MV&S serves as the roadmap for aligning its IT portfolio with its business objectives and 

processes and has resulted in the multi-year BSA IT Modernization program. By establishing an 

enterprise-wide information management and analysis framework, FinCEN, law enforcement, 

and financial industry regulators will be equipped with better decision-making abilities and 

increased value of BSA information through enhanced data integrity and analytical tools. BSA 

IT Modernization will help FinCEN move away from custom coded legacy applications, which 

are complex and difficult to maintain, to a more modern environment based on Commercial Off 

the Shelf (COTS) products and standardized data formats. FinCEN is supporting 

Treasury/OMB's goal of data center consolidation by hosting its production environments at the 

Bureau of Public Debt (BPD). In addition, FinCEN is working with OMB and the Program 

Manager for the Information Sharing Environment to develop National Information Exchange 

Model standards for data exchange with the law enforcement and intelligence communities.

The BSA IT Modernization effort helps move Treasury towards a "paperless" environment by 

mandating electronic filing and enabling future Treasury savings in paper-processing costs, while 

enabling industry savings due to the reduction of filing complexity. Moreover, with electronic 

filing, there are more checks and validations up front when BSA information is initially received, 

thus improving data quality.

Increasing the automated collection of BSA data also decreases the amount of time it takes to 

make critical information available to FinCEN and its stakeholders. Providing more reliable and 

valid data in pre-defined formats enables a higher confidence in the data and reduces the time to 

decipher and interpret data.
FinCEN - 19

FinCEN has continued to consult and work closely with the federal law enforcement and 

regulatory users of the BSA data, and also with the financial industry with respect to regulatory 

filing requirements and capabilities. In so defining the "user requirements" to be implemented 

through the modernization, FinCEN was able to confirm similar needs and desires among 

supported agencies, notwithstanding their distinct missions. Wherever possible, FinCEN has 

sought to identify and prioritize opportunities to develop capabilities that will meet the needs of 

multiple agencies supported by FinCEN. As such, the BSA IT Modernization will not only 

deliver better quality data on a more timely basis and better accessibility to that data, but also 

will seek to centralize investments in capabilities where practicable. Without the centralization, 

individual users might seek downstream investments in duplicative or similar capabilities.

FinCEN is employing a System Development Life Cycle (SDLC) methodology and proven 

Program Management methodologies, such as the Project Management Body of Knowledge, to 

manage the BSA IT Modernization program. In addition to implementing proven processes, 

FinCEN has also established strong executive leadership and governance involving both internal 

and external stakeholders to provide oversight for the program.

The highest level of governance, the Modernization Executive Group (MEG), is comprised of 

the Treasury CIO, FinCEN Director, and IRS Deputy Commissioner for Operations and 

Maintenance. 

FinCEN officially launched the BSA IT Modernization Program when it began using investment 

funds in May 2010. The FY 2013 base and request is $23.75 million (including FTE) and the 

full life cycle cost (10 years) is $267 million (including FTE). This Program is comprised of 

multiple projects and associated milestones, with delivery of those milestones occurring no more 

than six months apart in support of OMB's mandate to deliver results in timely modules. In 

support of this goal, some of the projects follow an iterative design and development approach, 

meaning that functionality is designed and developed incrementally over time, rather than 

waiting until all functionality has been designed before starting any development work. As such, 

the Program will be deploying functionality until the end of the investment. As functionality is 

released, it will immediately move into the operations and maintenance phase of the SDLC. 

Steady state for this investment begins in 2014.

FinCEN utilizes an Integrated Master Schedule (IMS) to depict all project activities, including 

cross project dependencies and resource loading. The IMS also serves as the foundation for 

conducting Earned Value Management, which effectively integrates the program's scope of work 

with schedule and cost elements for optimum project planning and control. The IMS will allow 

FinCEN to perform wellness analysis to help ensure adherence to "best practices", qualitative 

analysis to help ensure appropriate content, and performance analysis, such as critical path, 

schedule variance, and schedule trend analysis. These various analysis tools will help the bureau 

stay abreast of the cost and schedule for the program and take timely remedial actions as 

necessary.

Performance on the BSA IT Modernization Program is measured in several different ways. With 

regard to performance on the individual projects and milestones associated with the development 

and deployment activities, FinCEN's performance is measured monthly through the reporting 
FinCEN - 20

updates provided on the Federal IT Dashboard, which are monitored by the Treasury CIO and 

OMB. FinCEN has also established business and technical performance measures and 

associated targets to reflect whether or not FinCEN has successfully met specific objectives of

the Program. These performance measures will also be updated in the Treasury CPIC system 

and subsequently reflected in the Federal IT Dashboard. Progress against the select measures 

will begin to be reported in FY 2012, with the majority of progress being realized once the 

Program moves into operations and maintenance in FY 2013. 4.

A summary of capital investment resources, including major information technology and nontechnology investments is available