Combating Cross-border Financial Crime Act of 2023

Bill: 118-s-3384
Sponsor: full_name: Sen. Whitehouse, Sheldon [D-RI]
Introduced: 2023-11-30
Policy area: Immigration
Latest action: action_date: 2023-11-30
text: Read twice and referred to the Committee on Banking, Housing, and Urban Affairs.

Summaries:

tv_txt: II 118th CONGRESS 1st Session S. 3384 IN THE SENATE OF THE UNITED STATES November 30, 2023 Mr. Whitehouse (for himself, Mr. Cassidy , and Mr. King ) introduced the following bill; which was read twice and referred to the Committee on Banking, Housing, and Urban Affairs A BILL To combat illicit cross-border financial activity and to improve the Trade Transparency Unit program of U.S. Immigration and Customs Enforcement, and for other purposes.

1. Short title This Act may be cited as the Combating Cross-border Financial Crime Act of 2023 . 2. Establishment of Cross-Border Financial Crime Center The Tariff Act of 1930 ( 19 U.S.C. 1304 et seq. ) is amended by inserting after section 631 ( 19 U.S.C. 1631 ) the following: 632. Establishment of Cross-border Financial Crime Center (a) Establishment The Secretary of Homeland Security, acting through the Executive Associate Director of Homeland Security Investigations, shall— (1) establish the Cross-Border Financial Crime Center (in this section referred to as the Center ), which shall be located in the National Capital region (as defined in section 8702 of title 40, United States Code); and (2) appoint a Director to serve as the head of the Center (in this section referred to as the Director ). (b) Duties (1) In general The Center shall— (A) support, through the provision of analysts, equipment, and other resources, the investigation and seizure of assets and proceeds (as defined in section 981 of title 18, United States Code) related to trade-based money laundering and other illicit cross-border financial activity or attempted illicit cross-border financial activity, to, from, or through the United States, including such activity conducted by actors determined by the Secretary of State, the Attorney General, the Secretary of the Treasury, and the Secretary of Homeland Security to be the highest priority threats, including— (i) transnational criminal organizations; (ii) kleptocrats and oligarchs with respect to whom the United States has imposed sanctions; (iii) professional money laundering organizations; and (iv) persons knowingly enabling criminal or corrupt activity, including designated non-financial businesses and professions; (B) coordinate with the Deputy Directors appointed under subsection (c) and the heads of other relevant Federal agencies to better ensure uniform training is provided to United States Federal, State, local, and Tribal law enforcement agencies and foreign law enforcement agencies to address the vulnerabilities outlined in the National Money Laundering Risk Assessment, published by the Department of the Treasury in February 2022, or any successor document; (C) coordinate with such agencies to develop metrics to assess whether the training described in subparagraph (B) improved enforcement of anti-money laundering laws; (D) leverage existing, lawfully obtained, government data sources to establish a means to receive, collect, track, analyze, and deconflict information regarding illicit cross-border financial activity from United States and foreign law enforcement agencies and other non-Federal sources; (E) coordinate with the Deputy Directors appointed under subsection (c) and relevant components of their agencies, including the Financial Crimes Enforcement Network, to disseminate information, on a rolling basis, regarding trends and techniques involved in illicit cross-border financial activity to other Federal agencies, private sector stakeholders, and foreign law enforcement partners, as appropriate; (F) coordinate with the offices of United States attorneys in order to develop expertise in, and assist with, the investigation and prosecution of crimes involving trade-based money laundering and other illicit cross-border financial activity; and (G) carry out such other duties as the Executive Associate Director may assign. (2) Supplement not supplant The duties described in paragraph (1) shall supplement, not supplant, the work of existing Federal agencies, task forces, and working groups. (c) Deputy directors The Attorney General, the Secretary of the Treasury (acting through the Director of the Financial Crimes Enforcement Network), and the Secretary of State shall each appoint a Deputy Director to assist the Director. (d) Coordination with other agencies (1) In general In carrying out the duties described in subsection (b), the Director shall coordinate with the Federal entities specified in paragraph (2), and to the extent practicable, with the State, local, and Tribal entities specified in paragraph (3) to ensure at least part-time representation, in the form of detailees, in the Center of at least one agent or analyst with expertise in countering cross-border illicit finance, including trade-based money laundering, from each such entity. (2) Federal entities specified The Federal entities specified in this paragraph are the following: (A) The Department of the Treasury and the following components of the Department: (i) The Financial Crimes Enforcement Network. (ii) The Office of Foreign Assets Control. (iii) The Office of the Comptroller of the Currency. (iv) The Office of Technical Assistance. (v) Internal Revenue Service Criminal Investigation. (vi) The Small Business/Self Employed Division of the Internal Revenue Service. (B) The Department of Justice and the following components of the Department: (i) The Criminal Division. (ii) The Drug Enforcement Administration. (iii) The Federal Bureau of Investigation. (iv) Task Force KleptoCapture. (C) The Department of State and the following components of the Department: (i) The Bureau of International Narcotics and Law Enforcement Affairs. (ii) The Bureau of Western Hemisphere Affairs. (iii) The Bureau of African Affairs. (iv) The Bureau of East Asian and Pacific Affairs. (v) The Bureau of European and Eurasian Affairs. (vi) The Bureau of Near Eastern Affairs. (vii) The Bureau of South and Central Asian Affairs. (viii) The Bureau of Economic and Business Affairs. (ix) The Bureau of Diplomatic Security. (D) The following components of the Department of Homeland Security: (i) U.S. Customs and Border Protection. (ii) The United States Secret Service. (iii) The National Intellectual Property Rights Coordination Center. (iv) The Trade Transparency Units program of U.S. Immigration and Customs Enforcement. (v) The Bulk Cash Smuggling Center of U.S. Immigration and Customs Enforcement. (vi) The Cyber Crimes Center of Homeland Security Investigations. (E) The National Security Agency. (F) The United States Postal Inspection Service. (G) The Department of Commerce. (H) The Department of Defense. (I) The Office of the United States Trade Representative. (J) The Board of Governors of the Federal Reserve System. (K) The Commodity Futures Trading Commission. (L) The Securities and Exchange Commission. (M) The Federal Trade Commission. (N) The Federal Deposit Insurance Corporation. (O) The National Credit Union Administration. (3) State, local, and Tribal entities specified The State, local, and Tribal entities specified in this paragraph are the following: (A) Any State bank supervisor (as that term is defined in section 3 of the Federal Deposit Insurance Act ( 12 U.S.C. 1813 )) that the Executive Associate Director considers appropriate. (B) Any State credit union supervisor (as that term is used in the Federal Credit Union Act ( 12 U.S.C. 1751 et seq. )) that the Executive Associate Director considers appropriate. (C) Any State, local, and Tribal law enforcement agency that the Executive Associate Director considers appropriate. (4) Supplement not supplant The coordination described in paragraph (1) shall supplement, not supplant, the work of existing Federal agencies, task forces, and working groups. (e) Private sector outreach (1) In general The Director, in coordination with the Deputy Directors appointed under subsection (c) by the Attorney General and the Secretary of the Treasury, shall work with the Federal entities specified in subsection (d)(2) to conduct outreach to private sector entities in the United States in order to exchange information, in real-time or as soon as practicable, with respect to tactics and trends being used to conduct illicit cross-border financial activity, including such activity that involves corruption, international commercial trade and counterfeit products, bulk cash smuggling, the illicit use of digital assets or digital currencies and the dark web, and financial institutions and designated nonfinancial businesses and professions. (2) Training and technical assistance In order to coordinate public and private sector efforts to combat the tactics and trends described in paragraph (1), the Director, in coordination with the Deputy Directors appointed under subsection (c) by the Attorney General and the Secretary of the Treasury, shall provide training and technical assistance, as appropriate, regarding best practices for— (A) identifying, reporting, and protecting against money laundering; and (B) maintaining sensitive financial information, which may include suspicious activity reports and currency transaction reports. (3) Supplement not supplant The activities described in paragraphs (1) and (2) shall supplement, not supplant, the work of existing Federal agencies, task forces, and working groups. (f) International outreach (1) In general The Secretary of State, acting through the Assistant Secretary of State for International Narcotics and Law Enforcement Affairs, shall coordinate with the Director of the Center and the Deputy Directors of the Center appointed under subsection (c) by the Attorney General and the Secretary of the Treasury to facilitate capacity building and perform outreach to law enforcement agencies of countries that are partners of the United States and foreign private industry stakeholders by developing and providing specialized training and information-sharing opportunities regarding illicit cross-border financial activity, including such activity that involves corruption, international commercial trade and counterfeit products, bulk cash smuggling, the illicit use of digital assets or digital currencies and the dark web, and financial institutions and designated nonfinancial businesses and professions. (2) Coordination In carrying out paragraph (1) in a country, the Secretary of State, acting through the Assistant Secretary of State for International Narcotics and Law Enforcement Affairs, and in coordination with the Director of the Center and the Deputy Directors of the Center appointed under subsection (c) by the Attorney General and the Secretary of the Treasury, shall establish and maintain relationships with— (A) officials from law enforcement agencies, regulatory authorities, customs authorities, financial intelligence units, and ministries of finance in that country; and (B) private industry stakeholders in that country, including commercial and financial industry stakeholders most commonly impacted by illicit cross-border financial activity. (3) Supplement not supplant The activities described in paragraph (1) shall supplement, not supplant, international training conducted by other Federal agencies. (4) Information sharing To the extent practicable and consistent with other provisions of law, the Secretary of State, acting through the Assistant Secretary of State for International Narcotics and Law Enforcement Affairs, shall work with the Director and, as appropriate, the Deputy Directors appointed under subsection (c), to strengthen international cooperation and information-sharing agreements with law enforcement agencies of countries that are partners of the United States regarding combating illicit cross-border financial activity, including through the enhancement and expansion of Trade Transparency Units under section 633. (g) Report required (1) In general Not less frequently than annually, the Director shall submit to the appropriate congressional committees a report detailing the latest trends and techniques utilized to facilitate illicit cross-border financial activity. (2) Elements The report required by paragraph (1) shall include— (A) an assessment of the training provided to United States and foreign law enforcement agencies under subsection (b)(1)(B), based upon the metrics developed under subsection (b)(1)(C); (B) a summary of the activities conducted pursuant to subsections (d), (e), and (f); (C) the number and status of investigations supported by the Center, unless the disclosure of such information would reveal information protected by rule 6(e) of the Federal Rules of Criminal Procedure or a court order; (D) the amount of money and other assets of value in various forms that the United States Government seized as a result of such investigations; and (E) the countries with which the Center has established information-sharing agreements. (3) Form Each report required by paragraph (1) shall be submitted in unclassified form, but may include information that is classified or law enforcement sensitive in an annex. (h) Authorization of appropriations (1) In general There are authorized to be appropriated to the Secretary of Homeland Security to establish and maintain the Center— (A) $6,200,000 for fiscal year 2024; and (B) such sums as may be necessary for each of fiscal years 2025 through 2029. (2) Prohibition on use of funds None of the funds authorized to be appropriated pursuant to the authorization of appropriations under paragraph (1) may be obligated or expended to carry out civil immigration enforcement or removal activities. (i) Definitions In this section: (1) Appropriate congressional committees The term appropriate congressional committees means— (A) the Caucus on International Narcotics Control, the Committee on Finance, the Committee on Banking, Housing, and Urban Affairs, the Committee on the Judiciary, and the Committee on Foreign Relations of the Senate; and (B) the Committee on Ways and Means, the Committee on Financial Services, the Committee on the Judiciary, and the Committee on Foreign Affairs of the House of Representatives. (2) Trade-based money laundering The term trade-based money laundering means the process of disguising the proceeds of crime by moving such proceeds through the use of trade transactions in an attempt to legitimize the illegal origin of such proceeds or to finance criminal activities. (3) United States The term United States means the several States, the District of Columbia, the Commonwealth of Puerto Rico, American Samoa, the Commonwealth of the Northern Mariana Islands, Guam, and the Virgin Islands, and any federally recognized tribe (as defined in section 4(3)(B) of the Native American Housing Assistance and Self-Determination Act of 1996 ( 25 U.S.C. 4103(13)(B) ). . 3. Trade Transparency Units program The Tariff Act of 1930 ( 19 U.S.C. 1304 et seq. ), as amended by section 2, is further amended by inserting after section 632 the following: 633. Trade Transparency Units program (a) Establishment of program The Secretary of Homeland Security, acting through the Executive Associate Director of Homeland Security Investigations, shall establish a program under which Trade Transparency Units are established with foreign countries. (b) Purposes The purposes of Trade Transparency Units are— (1) to combat transnational criminal organizations, kleptocrats and oligarchs with respect to whom the United States has imposed sanctions, professional money laundering organizations, and other criminal or corrupt actors or enablers of criminal or corrupt activity; and (2) to prevent such persons from exploiting the international trade and financial infrastructures to finance criminal acts, evade sanctions or export controls, evade taxes, tariffs, or customs duties, or launder criminal or corrupt proceeds, by— (A) developing relationships with foreign law enforcement agencies and customs authorities; and (B) working through the Department of State to strengthen international cooperation and facilitate information-sharing agreements with foreign countries that provide for the exchange of import and export data with agencies of those countries, and as appropriate, other United States agencies, which can be used to investigate and prosecute international money laundering and illicit trade cases. (c) Establishment and composition of units (1) Establishment of units The Executive Associate Director, in consultation with the Secretary of State, may establish Trade Transparency Units in— (A) countries in which money laundering is prevalent; (B) countries in which corruption is prevalent; (C) countries that conduct a high volume of trade with the United States; (D) countries that have inconsistent trade figures or high incidences of illicit trade; (E) trade corridors in which one country that has a currency restriction in place; (F) countries that have been identified as having substantial volumes of suspicious financial transactions, based on data obtained under subchapter II of chapter 53 of title 31, United States Code; or (G) countries for which the Executive Associate Director, in consultation with the Secretary of State, determines that a Trade Transparency Unit would support the purposes of the Trade Transparency Units program under this section. (2) Requirements (A) In general Before establishing a Trade Transparency Unit in a country after the date of the enactment of the Combating Cross-border Financial Crime Act of 2023 , the Executive Associate Director shall— (i) ensure the United States and the government of the country have an active Customs Mutual Assistance Agreement in place; (ii) conduct a risk-based assessment to determine whether the country meets the criteria described in any of subparagraphs (A) through (F) of paragraph (1); and (iii) work with the United States embassy in the country to establish a trade data exchange agreement or memorandum of understanding with the government of the country that includes, to the greatest extent practicable, language to provide for the sharing of foreign import and export data with relevant United States agencies. (B) Transition rule The requirements under subparagraph (A) do not apply with respect to a Trade Transparency Unit established before the date of the enactment of the Combating Cross-border Financial Crime Act of 2023 . (3) Composition A Trade Transparency Unit may be comprised of personnel from— (A) Homeland Security Investigations; (B) other Federal agencies, as appropriate; and (C) foreign law enforcement agencies, as appropriate and pursuant to a trade data exchange agreement or memorandum of understanding described in paragraph (2)(C). (d) Operation After a trade data exchange agreement or memorandum of understanding described in subsection (c)(2)(A)(iii) is signed with a country, the Executive Associate Director, in consultation with the Secretary of State, may assign Homeland Security Investigations criminal investigators to the country to provide training and technical assistance to the country in order to operationalize and maintain a Trade Transparency Unit in that country. (e) Authorization of appropriations (1) In general There are authorized to be appropriated to the Secretary of Homeland Security $4,100,000 for each of fiscal years 2024 through 2029 to establish and maintain Trade Transparency Units. (2) Prohibition on use of funds None of the funds authorized to be appropriated pursuant to the authorization of appropriations under paragraph (1) may be obligated or expended to carry out civil immigration enforcement or removal activities. . 4. Government Accountability Office review of barriers to harmonizing data systems of certain law enforcement agencies (a) In general Not later than one year after the date of the enactment of this Act, the Comptroller General of the United States shall submit to the appropriate congressional committees a report detailing the statutory, technical, and security barriers to harmonizing the data systems of relevant law enforcement agencies, including the Bureau of Alcohol, Tobacco, Firearms, and Explosives, the Federal Bureau of Investigation, the Drug Enforcement Administration, the United States Secret Service, the Diplomatic Security Service, the Financial Crimes Enforcement Network, and U.S. Customs and Border Protection, to improve data access necessary to facilitate trade-based money laundering investigations. (b) Assessment of new technologies The report required by subsection (a) shall include an assessment of the benefits and feasibility of integrating new technologies, including distributed ledger technology and quantum ledger technology, into the processes of U.S. Customs and Border Protection and the customs services of foreign jurisdictions with which the United States has trade agreements in effect in order to facilitate the immediate, secure, and complete transfer between jurisdictions of lists of goods and related invoices and bills of lading. (c) Definitions In this section: (1) Appropriate congressional committees The term appropriate congressional committees means— (A) the Caucus on International Narcotics Control, the Committee on Finance, the Committee on Banking, Housing, and Urban Affairs, and the Committee on the Judiciary of the Senate; and (B) the Committee on Ways and Means, the Committee on Financial Services, and the Committee on the Judiciary of the House of Representatives. (2) Trade-based money laundering The term trade-based money laundering means the process of disguising the proceeds of crime by moving such proceeds through the use of trade transactions in an attempt to legitimize the illegal origin of such proceeds or to finance criminal activities.