Combating Illicit Financing: Treasury's Office of Terrorism and Financial Intelligence Could Manage More Effectively to Achieve Its Mission
Published: 2009-09-24T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: In 2004, Congress combined preexisting and newly created units to form the Office of Terrorism and Financial Intelligence (TFI) within the Department of the Treasury (Treasury). TFI's mission is to integrate intelligence and enforcement functions to (1) safeguard the financial system against illicit use and (2) combat rogue nations, terrorist facilitators, and other national security threats. In the 5 years since TFI's creation, questioned have been raised about how TFI is managed and allocates its resources. As a result, GAO was asked to analyze how TFI (1) implements its functions, particularly in collaboration with interagency partners, (2) conducts strategic resource planning, and (3) measures its performance. To conduct this analysis, GAO reviewed Treasury and TFI planning documents, performance reports, and workforce data, and interviewed officials from Treasury and its key interagency partners.
section_title: What GAO Found
paragraphs: TFI undertakes five functions, each implemented by a TFI component, in order to achieve its mission. TFI officials cite the analysis of financial intelligence as a critical part of TFI's efforts because it underlies TFI's ability to utilize many of its tools. They said that the creation of OIA was critical to Treasury's ability to effectively identify illicit financial networks. To achieve its mission, TFI's five components often work with each other, other U.S. government agencies, the private sector, or foreign governments. Officials from TFI and its interagency partners cited strong collaboration in many areas, such as effective information sharing between FinCEN and the Justice Department (Justice). Officials differed, however, about the quality of interagency collaboration involving international forums. Treasury officials who led this collaboration stated that it runs smoothly and that they were unaware of any significant concerns, while Justice and State officials reported declining collaboration and unclear mechanisms to enhance or sustain it. While TFI and some of its components have conducted selected strategic resource planning activities, TFI as a unit has not fully adopted key practices that enhance such efforts. For example, TFI and its components have produced multiple strategic planning documents in recent years, but the objectives in some of these documents are not clearly aligned with resources needed to achieve them. As a result, it may be unclear whether TFI has sufficient resources to address its objectives. Also, though TFI has undertaken some workforce planning activities, it lacks a process for performing comprehensive strategic workforce planning. Thus, it is unclear whether TFI is able to effectively address persistent workforce challenges. Also, TFI has not yet developed appropriate performance measures, changing their number and substance each year. Though TFI's current measures fully address many attributes of effective performance measures, they do not cover all TFI core program activities. TFI officials acknowledge the need for improvement and have worked since 2007 to develop one overall performance measure to assess TFI. Yet questions remain about when TFI will implement its new measure and whether it will effectively gauge TFI's performance.

section_title: Letter
paragraphs: While the globalization of finance and trade has the potential to enhance  economic prosperity and stability across the world, some individuals,  organizations, and countries that pose a threat to U.S. national security  have exploited worldwide financial channels. Governmentwide strategies,  such as the 2006 National Strategy for Combating Terrorism and the  2007 National Money Laundering Strategy acknowledge the threats  posed by the illicit use of the international financial system by terrorist  organizations, weapons of mass destruction (WMD) proliferators, drug  kingpins, and other national security threats. In 2004 Congress established  the Office of Terrorism and Financial Intelligence (TFI) to provide policy,  strategic, and operational direction to the Department of the Treasury’s  (Treasury) efforts to address issues such as terrorism financing, financial  crimes, and intelligence analysis.
Based on your interest in TFI, this report assesses how TFI (1) implements  functions to fulfill its mission, particularly in collaboration with  interagency partners; (2) conducts strategic resource planning; and   (3) measures its performance.
To meet these objectives, we reviewed documents and interviewed  officials from Treasury and its key interagency partners. To analyze TFI’s  implementation of its functions, we reviewed Treasury reports and  documents related to its efforts since 2004. We also interviewed officials  from Treasury and its key interagency partners, the Departments of State  (State) and Justice (Justice), to review interagency collaboration efforts.  To analyze TFI’s efforts to conduct strategic resource planning, we  reviewed documentation relating to TFI’s strategies (notably strategic  plans), analyzed data on TFI resources for 2005 through 2008, and  interviewed TFI officials involved in resource planning, including the  Under Secretary for Terrorism and Financial Intelligence. To analyze how  TFI measures its performance, we reviewed Treasury’s performance  measures included in its performance and accountability reports for 2005- 2008 and interviewed officials from TFI and Treasury’s Office of Strategic  Planning and Performance Management. We conducted this performance  audit from July 2008 to September 2009, in accordance with generally  accepted government auditing standards. Those standards require that we  plan and perform the audit to obtain sufficient, appropriate evidence to  provide a reasonable basis for our findings and conclusions based on our  audit objectives. We believe that the evidence obtained provides a  reasonable basis for our findings and conclusions based on our audit  objectives. See appendix I for additional details regarding our scope and  methodology.
subsections: section_title: Background
paragraphs: After the September 11, 2001, terrorist attacks, Congress passed the  Uniting and Strengthening America by Providing Appropriate Tools  Required to Intercept and Obstruct Terrorism (USA PATRIOT) Act of  2001, which amended and broadened the scope of the Bank Secrecy Act  (BSA) to include additional financial industry sectors and a focus on the  financing of terrorism. Subsequently, Congress passed the Intelligence  Authorization Act for 2004, which established Treasury’s Office of  Intelligence and Analysis (OIA).  OIA is a member of the Intelligence  Community, as defined under Executive Order 12333, as amended. The  Intelligence Reform and Terrorism Prevention Act of 2004 identified the  Secretary of the Treasury or his or her designee as the lead U.S.  government official to the Financial Action Task Force (FATF), to  continue to convene an interagency working group on FATF issues. TFI’s  mission is to marshal Treasury’s policy, enforcement, regulatory, and  intelligence functions in order to safeguard the U.S. financial system from  abuse and sever the lines of financial support to international terrorists,  WMD proliferators, narcotics traffickers, money launderers, and other  threats to U.S. national security.
The formation of TFI combined both existing and new units of Treasury.  Five key components are included under the umbrella of TFI:    Office of Foreign Assets Control (OFAC), formed in 1950, administers and  enforces sanctions.
Financial Crimes Enforcement Network (FinCEN), formed in 1990,  administers and enforces the BSA and serves as the United States’  financial intelligence unit (FIU).
Treasury Executive Office for Asset Forfeiture (TEOAF), formed in 1992,  administers the Treasury Forfeiture Fund—the receipt account for the  deposit of non-tax forfeitures made by member agencies.
Office of Terrorist Financing and Financial Crimes (TFFC), established in  2004, serves as TFI’s policy and outreach arm.
OIA, also established in 2004, performs Treasury’s intelligence functions,  integrating Treasury into the larger Intelligence Community, and providing  intelligence support to Treasury leadership.
FinCEN is a Treasury bureau;  the other four components are offices  within TFI, which is a part of Treasury’s structure of departmental offices.  Figure 1 shows TFI’s current organizational structure.
To achieve its mission, TFI components often work with the following:    Other U.S. government agencies. For instance, OFAC works with State  and Justice, among others, to designate individuals and organizations  under 21 separate sanctions programs. TFFC also works with State,  Justice, and other agencies in developing and advocating a U.S. position in  international forums related to money laundering and illicit financing. In  addition, TEOAF works with State and Justice to administer sharing of  large case forfeiture proceeds with foreign governments, pursuant to  international treaties, whose law enforcement personnel cooperated with  U.S. federal investigations.
Other TFI components. For example, OIA provides information to OFAC  to assist in making decisions regarding whether to pursue designations of  individuals and organizations. For completed designations, OIA also works  with OFAC to declassify intelligence information for public dissemination.
Private sector. For example, in its role as the Secretary’s delegated  administrator of the BSA, FinCEN regularly interacts with the private  sector, including the financial sector. One such mechanism for maintaining  formal ties to the private sector is Treasury’s BSA Advisory Group.  FinCEN also conducts informal consultations with financial institutions  regarding their individual financial intelligence efforts.
Foreign governments and international organizations. Treasury heads  the U.S. delegation to the FATF, an international body that develops and  implements multilateral standards relating to anti-money laundering and  counterterrorist financing. TFFC leads this effort on behalf of Treasury.  Similarly, FinCEN works with foreign governments to develop and  strengthen capabilities of their FIUs as well as to respond to requests for  assistance from foreign FIUs, which totaled more than 1,000 in fiscal year  2008.
As shown in figure 2, the size of TFI’s staff has grown from approximately  500 in fiscal year 2005 to approximately 650 in fiscal year 2008. FinCEN,  with 299 full-time equivalents (FTE) in fiscal year 2008, is TFI’s largest  component, and OIA gained the most staff—90—from fiscal years 2005  through 2008.
As shown in figure 3, TFI’s budget has grown from approximately $110  million in fiscal year 2005 to approximately $140 million in fiscal year 2008.  With a budget of approximately $86 million, FinCEN has the largest budget  of any TFI component. In addition, OIA’s budget has grown at the greatest  rate, from about $9 million in fiscal year 2005 to about $20 million in fiscal  year 2008.
section_title: TFI Performs Five Functions to Fulfill Its Mission, but Agencies Differ about the Quality of Some Interagency Collaboration
paragraphs: According to TFI, it undertakes five functions in order to achieve its  mission. Officials from TFI and its interagency partners cited strong  collaboration with TFI in several areas, but differ about the quality of  collaboration regarding U.S. participation in some international forums.
subsections: section_title: TFI Performs Five Functions to Fulfill Its Mission
paragraphs: According to TFI, it undertakes five functions to safeguard the financial  system from illicit use and to combat rogue nations, terrorist supporters,  WMD proliferators, money launderers, drug kingpins, and other national  security threats. These functions are (1) building international coalitions,  (2) analyzing financial intelligence, (3) administering and enforcing the  BSA, (4) administering and enforcing sanctions, and (5) administering  forfeited funds.
subsections: section_title: Building International Coalitions
paragraphs: TFI employs two primary means to build international coalitions to  support U.S. national security interests. These are deepening engagement  in international forums and improving international partners’ capacity.
Deepening engagement in international forums. TFI and other U.S.  agencies participate in several international organizations intended to  strengthen the international financial system so that it cannot be exploited  by criminal networks. Two examples are the FATF and the Egmont  Group. TFFC leads the U.S. delegation to the FATF, while FinCEN leads  U.S. participation in the Egmont Group. According to TFI officials, U.S.  participation in such organizations provides a unique opportunity to  engage with international counterparts in the effort to develop  international standards and a framework for countries to implement legal  regimes that protect the international financial system from abuse.
TFI also uses international forums to advance the U.S. agenda in areas  such as nonproliferation. For example, according to TFI, it has been  working closely with other G-7 countries to determine what steps can be  taken to isolate proliferators from the international financial system  through multilateral action. For instance, according to TFI officials, they  are working with State to encourage the more than 85 countries that  participate in the Proliferation Security Initiative to use financial measures  to combat proliferation support networks.
In addition to playing a leadership role in these organizations and forums,  TFI officials report that they are also working to expand these  organizations’ membership so as to broaden the reach of international  financial standards. For example, as of March 2009, FinCEN was  sponsoring 12 countries’ membership in the Egmont Group, including  Afghanistan, Saudi Arabia, Pakistan, and Yemen. According to FinCEN  officials, the addition of such new members will greatly strengthen  FinCEN’s ability to obtain valuable information related to the activities of  illicit financial networks.
Improving international partners’ capacity. As part of TFI, FinCEN has  made engagement with foreign FIUs in the detection and deterrence of  crime one of its strategic objectives. To accomplish this objective, FinCEN  has undertaken a variety of efforts to strengthen the global network of  FIUs. For example, according to FinCEN officials, they engage in a variety  of cooperative efforts with other FIUs aimed at fostering productive  working relationships and best practices. In addition, according to TFI  officials, they participate in mutual evaluation studies, as part of its  participation in the FATF, to identify measures to improve other FATF  members’ regulatory regimes related to combating money laundering and  terrorist financing. For example, in fiscal year 2008, the FATF performed  six mutual evaluations; the United States delegation, led by TFFC, sent  representatives to serve as assessors for four of these mutual evaluations.
section_title: Analyzing Financial Intelligence
paragraphs: TFI officials cite OIA’s analysis of financial intelligence as a critical part of  TFI’s efforts because it underlies TFI’s ability to utilize many of its tools.  The first step in disrupting and dismantling illicit financial networks is  identifying those networks, according to TFI officials. They said that the  creation of OIA was critical to TFI’s ability to effectively identify these  illicit financial networks. As a member of the broader intelligence  community, OIA performs analysis of intelligence information related to  national security threats with a view toward potential action and  utilization of tools available to TFI.  Staff in other TFI components and TFI  management then use this intelligence analysis to draft papers to  implement such strategies or actions.
In addition, TFI utilizes intelligence analysis to assess the impact of the  actions it takes. For example, according to the Under Secretary for TFI,  intelligence analysts have assessed the impact of previous financial  actions taken to address the national security threat posed by North  Korea. Those assessments were then used to shape the U.S. policy  response to the most recent missile and nuclear tests by North Korea.
section_title: Administering and Enforcing the BSA
paragraphs: According to TFI officials, FinCEN’s administration of the BSA plays a key  role in TFI’s ability to achieve its mission. The BSA includes a variety of  reporting and record-keeping requirements that provide useful information  to law enforcement and regulatory agencies. For example, pursuant to the  BSA, Treasury (FinCEN) requires financial institutions to report  suspicious financial activities relevant to a possible violation of law. Such  suspicious activity reports (SAR) are then analyzed by FinCEN and made  available to the law enforcement and regulatory communities.  In 2007,  financial institutions filed nearly 1.3 million SARs, which federal, state,  and local law enforcement agencies use in their investigations of money  laundering, terrorist financing, and other financial crimes.
The BSA, as amended by the USA PATRIOT Act, also grants Treasury  additional authorities, which are delegated to FinCEN, to combat money  laundering and terrorist financing. For example, Section 311 of the USA  PATRIOT Act amended the BSA to provide an additional tool to safeguard  the U.S. financial system from illicit foreign financial institutions and  networks. According to TFI officials, Section 311 is an important and  extraordinarily powerful tool, as it authorizes Treasury to find a foreign  jurisdiction, foreign financial institution, type of account, or class of  transaction as being of “primary money laundering concern.” Such a  finding enables Treasury to impose a range of special measures that U.S.  financial institutions must take to protect against illicit financing risks  posed by the target. These special measures range from enhanced record- keeping and reporting requirements up to prohibiting U.S. financial  institutions from maintaining certain accounts for foreign banks if they  involve foreign jurisdictions or institutions found to be of primary money  laundering concern.
section_title: Administering and Enforcing Sanctions
paragraphs: The imposition of economic sanctions has been a long-standing tool for  addressing a range of national security threats. OFAC currently maintains  primary responsibility for administering more than 20 separate sanctions  programs. (See app. II for a list of current U.S. sanctions programs.) These  sanctions programs fall into two categories: (1) country-based programs  that apply sanctions to an entire country—such as Cuba, Iran, or Sudan— and (2) targeted, list-based programs that address individuals or entities  engaged in specific types of activities such as terrorism, WMD  proliferation, or narcotics trafficking. For example, according to TFI  officials, they use the authorities under the International Emergency  Economic Powers Act and Executive Order 13224 to designate those who  provide support to terrorists, freezing any assets they have under U.S.  jurisdiction and preventing U.S. persons from doing business with them.  From fiscal years 2004 through 2008, Treasury designated or supported the  designation of more than 1,900 individuals and organizations under  various sanctions programs.
To help ensure compliance with U.S. sanctions programs, Treasury also  has the authority to impose civil penalties on individuals and organizations  that violate U.S. sanctions. From 2004 through 2008, OFAC imposed more  than 1,500 civil penalties related to violations of its sanctions programs. As  a result, OFAC assessed nearly $15 million in penalties.
section_title: Administering Forfeited Funds
paragraphs: According to TEOAF, an important tool in the U.S. fight against money  laundering is asset forfeiture. Forfeiture assists in the achievement of  TFI’s mission in two ways. First, asset forfeiture strips away the profit  from illegal activity, thus making it less attractive. According to TEOAF, in  fiscal year 2008 it received more than $500 million in total forfeiture  revenue; the majority, after net expenses, came from forfeitures processed  by Immigration and Customs Enforcement and the Internal Revenue  Service–Criminal Investigation. Second, according to the Director of  TEOAF, the revenue derived from such forfeited assets can be used to  fund federal law enforcement activities, including initiatives directed at  further combating illicit financing networks. For example, in fiscal year  2008, TEOAF provided approximately $1 million in funding to Immigration  and Customs Enforcement to provide training to international partners.  Specifically, the funding was provided to allow the expansion of existing  training activities to assist in combating bulk cash smuggling by terrorist  groups and other criminal networks.
section_title: Despite General Approval of Interagency Collaboration with TFI, Agencies Differ on Quality of Collaboration for International Forums
paragraphs: Collaborating with interagency partners is important to TFI’s ability to  perform effectively. Many of the tools TFI utilizes to combat national  security threats involve multiple agencies reviewing the proposed action.  For example, according to Treasury officials, they consult with officials  from State, Justice, and the Department of Homeland Security on  decisions to designate individuals or organizations that support terrorism.  In addition, other tools, such as advocating actions to strengthen the  international financial system through the FATF, benefit from the  expertise and input from collaboration with a variety of agencies,  including State, Justice, the Securities and Exchange Commission, the  Department of Homeland Security, and others. Prior GAO work has  identified several practices that can enhance and sustain such interagency  collaboration. One such practice is establishing compatible policies,  procedures, and other means to operate across agency boundaries.
Another practice is developing a mechanism for monitoring, evaluating,  and reporting on the results of collaborative efforts.
Officials at TFI and other agencies said that they generally are satisfied  with the quality of interagency collaboration. TFI’s interagency partners  report close, collaborative relationships in many situations. For example,  State officials told us that they have strong working relationships with  officials in almost all TFI components. They highlighted their  collaboration with TFI during the designation process and suggested that  it is generally effective. These officials commented that if State has  information from its embassies abroad that indicates that a specific  designation would be particularly damaging to U.S. foreign policy  interests, they relay this information to Treasury and discuss alternative  approaches. State officials added that the designation process operates  effectively, even when agencies may have disagreements over a particular  designation, because the National Security Council leads a process to  coordinate terrorism designations. It serves as an impartial arbiter that  prevents any single agency from exerting too much influence. In addition,  Justice officials described a strong working relationship with FinCEN  regarding asset forfeiture and money laundering issues. Specifically, they  recounted effective communication and information sharing. For example,  Justice officials told us that FinCEN has granted Justice access to BSA  data, thus allowing Justice to perform its own analyses for law  enforcement purposes. Additionally, Justice officials said that FinCEN has  helped them utilize its network of international contacts at other  countries’ FIUs.
However, TFI’s interagency partners have expressed concerns regarding  collaboration in other areas. For example, in September 2008, we reported  that State and Justice expressed concerns regarding Treasury’s  consultations with them when implementing Section 311 of the USA  PATRIOT Act. In addition, TFI and other agencies’ officials differed  about the effectiveness of interagency collaboration for the function of  building international coalitions, particularly when participating in the  international forums of the FATF and FATF-Style Regional Bodies (FSRB).  On the one hand, TFFC officials suggest that interagency collaboration  regarding the FATF and FSRBs has been highly effective over the past 5  years and that Treasury’s ability to effectively lead the U.S. delegation has  been greatly strengthened by the participation of a wide variety of  regulatory, law enforcement, and other agencies. The Deputy Assistant  Secretary for Terrorist Financing and Financial Crimes added that during  this time, there have been no major disagreements between agencies  regarding the positions the United States should take in such international  forums. TFI officials also stated that interagency collaboration runs  smoothly and that they were unaware of any significant concerns  regarding the quality of interagency collaboration.
Officials from State and Justice, however, indicated that the quality of  interagency collaboration regarding the FATF and FSRBs has declined  substantially over the past 5 years. These officials expressed two types of  concerns regarding TFI’s collaboration with other agencies regarding  participation in international forums: (1) the exclusion of non-Treasury  personnel in key situations and (2) the extent to which TFI makes  unilateral decisions regarding the U.S. government position.
With regard to TFI’s exclusion of non-Treasury personnel in key situations,  TFI and other agencies differ. State and Justice officials cited several  examples of situations they believe undermined U.S. effectiveness at  combating illicit financing networks. For example, according to State  officials, a State official who has taken the necessary training has not been  allowed to participate as a member of the U.S. team conducting FATF  mutual evaluations. According to these officials, this results in the  exclusion of senior staff with significant experience and expertise that  could benefit the evaluation teams. In response, TFFC officials indicated  that they have included other agencies in the mutual evaluation process.  For example, they indicated that officials from Justice and other agencies  participated in at least six mutual evaluations from 2004 through 2009.  According to TFI, it encourages and attempts to facilitate such  participation by other agency officials who have attended the necessary 1- week training course and whose agencies will pay for their travel to  foreign countries to conduct and defend their evaluations.
Additionally, Justice officials stated that when TFI allows other agencies  to review and comment on U.S. policy proposals related to anti-money  laundering and counterterrorist financing, it consistently provides too little  time for review. Specifically, Justice officials told us that TFI regularly  provides agencies 24 hours to review and provide comments on policy  proposals, which may make it impossible for agencies to conduct an  appropriate review and effectively excludes them from the process.  According to TFI officials, they distribute materials as soon as possible;  for FATF materials this occurs within 24 hours of receiving them, though  they acknowledge that they often are provided short deadlines by the  FATF Secretariat. According to TFI officials, they sometimes request an  extension of the deadline or submit the U.S. response late in order to  obtain interagency views.
With regard to concerns about TFI’s unilateral decision making, TFI and  other agencies also differed. State and Justice officials cited a situation  related to the U.S. position on how to treat the European Union (as a  single entity or as separate countries) for the purposes of cash-smuggling  regulations. According to State and Justice officials, during interagency  meetings prior to the FATF working group session at which the issue was  to be discussed, a consensus U.S. position was developed. However, State  and Justice officials said that at the FATF plenary meetings, Treasury  officials advocated a position that was different from the consensus U.S.  position agreed to in advance of the meeting. A Treasury official told us  that the agency did not deviate from the consensus position agreed to  before the meeting.
Justice, State, and Treasury officials said that there is no guidance  specifying how the interagency process should operate to develop U.S.  positions in advance of FATF meetings. Specifically, there is no guidance  regarding the process or time frames for circulating or approving U.S.  policy statements to be made at international meetings to discuss anti- money laundering and counterterrorist financing issues. In addition, there  is no formal mechanism for monitoring, evaluating, or reporting on the  results of agencies’ collaborative efforts.
According to State and Justice officials, the inconsistent quality of  interagency collaboration may undermine some efforts to combat illicit  financing networks through international forums. State officials suggested  that the exclusion of non-Treasury personnel may mean that expertise  available within the U.S. government is not effectively utilized, thus  potentially weakening the United States’ ability to influence international  partners’ actions. In addition, they suggested that unilateral action by  Treasury in international forums may cause confusion among international  partners regarding the nature of the U.S. position on key issues. On the  basis of comments they received from foreign officials, Justice and State  officials concluded that such confusion might weaken the United States’  ability to influence the activities of international partners.  TFFC  responded that it has not observed any confusion among its international  partners in FATF regarding the U.S. position on key issues.
Justice and State officials did not raise similar concerns concerning  FinCEN’s collaboration when participating with them on issues related to  the Egmont Group. In contrast, Justice officials expressed some criticisms  of more recent collaboration with OFAC on issues such as information  sharing.  OFAC responded that it has regular contact with Justice with  respect to enforcement matters and that the two agencies have an ongoing  dialogue regarding information sharing.  OFAC also noted that only a small  subset of its enforcement cases involve the type of knowing conduct that  is appropriate for referral to criminal authorities.
section_title: TFI Has Not Clearly Aligned Its Resources with Priorities or Performed Comprehensive Workforce Planning
paragraphs: While TFI has conducted strategic planning activities at different levels  within the organization, TFI as a unit has not fully adopted certain key  practices. In particular, TFI has not clearly aligned its resources with its  priorities. TFI’s strategic planning documents do not consistently integrate  discussion of the resources needed to achieve TFI’s strategic objectives. In  addition, TFI’s resource levels for each component cannot be clearly  linked to its workload. Also, while some TFI components have taken the  initiative to conduct some workforce planning activities, TFI management  has not developed a process for conducting comprehensive strategic  workforce planning.
subsections: section_title: TFI Has Not Clearly Aligned Its Resources with Its Priorities
paragraphs: Our review of TFI’s and its components’ strategic planning documents and  discussions with TFI officials showed that TFI has not clearly aligned its  resources with its priorities. TFI officials indicated that priorities could be  identified in TFI’s strategic plan. TFI identified four relevant strategic  plans: one for TFI as a whole and one each for FinCEN, OIA, and TEOAF.
Strategic plans are used to communicate what an organization seeks to  achieve in the upcoming years, according to Treasury instructions. The  goals and strategies presented in the plan provide a road map for both the  organization and its stakeholders. Strategic plans should guide the  formulation and execution of the budget as well as other decision making  that shapes and guides the organization. These plans are a tool for setting  priorities and allocating resources consistent with these priorities,  according to Treasury. Our previous work has shown that strategic plans  should clearly link goals and objectives to the resources needed to achieve  them and are especially important in those cases where agencies submit a  strategic plan for each of their major components and a strategic overview  that under the guidance is to show the linkages among these plans.  Government Performance and Results Act guidance also establishes six  key elements of successful strategic plans, and Treasury’s instructions  suggest plan formats.
However, we found that TFI’s and its components’ strategic plans do not  consistently integrate discussion of the resources necessary to achieve TFI  objectives. Specifically, we found that    FinCEN’s and TEOAF’s strategic plans contain some discussion of the  resources needed to achieve their objectives.
TFI’s and OIA’s strategic plans do not contain discussion of the resources  needed to achieve their objectives.
OFAC and TFFC do not currently have strategic plans.
While TFI’s strategic plan includes a mission statement; a list of threats,  goals, and objectives; and means and strategies, it does not include any  discussion or analysis of TFI’s resource needs. Moreover, TFI’s strategic  plan lists all four of its goals, and each of its means and strategies under  each goal as equivalent: it does not indicate any prioritization among its  various goals, means, and strategies.
The Under Secretary for TFI said that he uses the annual budget process  to align resources with priorities. However, two reasons suggest why the  results of the budget process do not necessarily reflect TFI’s strategic  priorities. First, there are many other factors that affect the budget  process that are unrelated to TFI’s priorities. The amount of resources TFI  seeks is integrated into a larger Treasury budget request, which may entail  modifying TFI’s request. Congress, then, may choose to provide more or  less than the amount of resources to TFI that Treasury requested. Second,  the annual budget process reflects priorities only for a given year, unlike  strategic plans, which are intended to be multiyear documents and thus  reflect longer-term priorities.
Further, the linkage between the resources allocated to each TFI  component and its workload is unclear. Estimated workload measures for  each of TFI’s components show a growth in workload since 2005, but it is  unclear how this growth relates to resource increases. For example, one  measure of FinCEN’s workload—the number of SARs it must analyze— has increased 50 percent and the number of employees in FinCEN has  increased 3 percent. In addition, TEOAF has seen an 83 percent increase  in the value of seized assets it manages and the number of FTEs has grown  10 percent. Further, the number of OFAC licensing actions increased 56  percent while the number of FTEs grew 18 percent. Additionally, OIA  experienced a more than 500 percent increase in intelligence taskings  from 2006 to 2008 and has received a 200 percent increase in FTEs.  Finally, TFFC estimates that its workload related to developing policy  papers, legislative and rulemaking papers, trips, and public outreach  events increased between 100 and 200 percent from 2005 to 2009; its FTEs  grew nearly 80 percent from 2005 to 2008.
According to TFI officials, their ability to allocate resources to their  highest priorities is constrained in some circumstances. The Under  Secretary and other TFI officials identified activities related to Iran and  North Korea as persistent priorities. However, OFAC officials noted that in  spite of the importance of Iran- and North Korea-related activities, they  must expend a significant amount of resources on implementing the Cuba  embargo. With regard to acting on specific licensing requests for exports  and travel to Cuba, according to OFAC officials, they have little flexibility  under the law. OFAC is required to process all license applications that it  receives. For 2005 through 2008, this amounted to more than 200,000  licensing actions—more than 95 percent of which related to the Cuba  program. In 2008 alone, OFAC responded to nearly 60,000 licensing  requests related to the Cuba travel program. OFAC officials characterized  this situation as a resource burden.
In contrast, according to OFAC officials, they have some flexibility  regarding how they enforce the Cuba sanctions program, for example,  through the assessment of civil penalties for violations. According to  OFAC officials, for many years (through 2005), OFAC assessed a large  number of civil penalties related to the Cuba travel regulations. As  violations of these regulations have a relatively small financial penalty  associated with them, the average penalty amount was relatively low.  Since 2006, according to OFAC officials, they have consciously utilized the  flexibility they are allowed in order to dedicate their enforcement  resources to higher-value areas (e.g., those related to trade with Cuba,  Iran, and North Korea). As a result, the number of penalties assessed  annually related to the Cuba sanctions program has dropped significantly,  from 498 in 2005 to 46 in 2008. At the same time, the average value of  OFAC’s civil penalties for violations of all sanctions programs has  increased significantly, from approximately $2,400 in 2005 to nearly  $31,000 in 2008.
section_title: TFI Has Not Taken a Comprehensive Approach to Strategic Workforce Planning
paragraphs: Despite efforts by some components, TFI management has not yet  conducted comprehensive activities to address the key principles of  strategic workforce planning. According to the Under Secretary, TFI’s  workforce is its greatest asset, and ensuring that it is the right size and  includes the right skills is critical to TFI’s future ability to achieve its  mission. Prior GAO work has identified key principles to assist agencies in  conducting strategic workforce planning. Among these principles are (1)  involving top management, employees, and other stakeholders in  developing, communicating, and implementing the strategic workforce  plan, and (2) monitoring and evaluating the agency’s progress toward its  human capital goals and the contribution that human capital results have  made toward achieving programmatic results.
According to TFI officials, some TFI components have taken the initiative  individually to perform some strategic workforce planning activities.  Specifically, as a Treasury bureau, FinCEN has an internal human  resources group that, among other things, performs some strategic  workforce planning activities. For example, according to FinCEN officials,  they undertook an effort to identify mission critical occupations, which  resulted in designating three positions as mission critical. As a result,  FinCEN developed plans to address human capital challenges related to  these occupations and regularly reports to Treasury’s Office of the Deputy  Assistant Secretary for Human Resources and Chief Human Capital Officer  on its progress. In addition, OIA has taken a variety of steps to address  human capital challenges. For example, according to OIA officials, to  address challenges in recruiting and retaining intelligence analysts, OIA  cataloged the human capital flexibilities available to provide recruiting and  retention incentives. As a result, OIA officials indicated that they have  identified and are now able to utilize a variety of human capital  flexibilities, such as student loan repayment to attract and retain staff and  the Pat Roberts Intelligence Scholarship Program to pay for the continuing  educational needs of its analysts.
Nonetheless, TFI management has not yet conducted comprehensive  activities to address the key principles of strategic workforce planning for  TFI as a whole. TFI top management has not set the overall direction and  goals of workforce planning or evaluated progress toward any human  capital goals. The Under Secretary for TFI told us that since the creation of  TFI, growing OIA’s human capital has been one workforce planning  priority. He also stated that he has conducted additional targeted  workforce planning in consultation with the heads of the largest TFI  components, such as FinCEN. However, neither TFI officials nor Treasury  human capital officials were aware of any explicit workforce planning  goals set by TFI management. In addition, TFI officials were unaware of  any formal reviews or reports that evaluated the contribution of human  capital results to achieving programmatic goals.
Moreover, TFI currently lacks an effective process for conducting  comprehensive strategic workforce planning. According to the Under  Secretary for TFI, most workforce planning takes place as a part of the  annual budget process. TFI has not established a separate, comprehensive  strategic workforce planning process led by TFI management. According  to an official from Treasury’s Office of the Deputy Assistant Secretary for  Human Resources and Chief Human Capital Officer, the office has  provided targeted workforce planning assistance to OIA and, in spring  2009, began discussing how they could assist TFI in broader workforce  planning efforts. In particular, they cited the need to conduct an overall  workforce analysis and succession planning.
According to TFI’s Senior Resource Manager, TFI’s workforce planning  mainly occurs as a component of the annual budget preparation process.  As a part of this process, individual components can request additional  staff resources for priority initiatives they identify. TFI management then  evaluates these individual proposals and determines what will be included  in TFI’s budget request.
Without the benefit of comprehensive strategic workforce planning to  assist in identifying solutions, it is unclear whether TFI will be able to  effectively address persistent workforce challenges. These include the  following:    Lack of comprehensive training needs assessment. While some TFI  components have assessed the training needs of their staff, there has been  no similar TFI-wide effort. Without such an assessment, it is unclear  whether TFI staff are being prepared to address the challenges posed by  illicit financing in the future.
Obstacles to hiring intelligence analysts. According to officials from OIA  and Treasury’s Office of the Deputy Assistant Secretary for Human  Resources and Chief Human Capital Officer, OIA continues to be at a  competitive disadvantage relative to other agencies in the Intelligence  Community regarding recruiting. Specifically, according to Treasury  officials, most other agencies in the Intelligence Community can hire  intelligence analysts into the excepted service, thus bypassing the need for  competitive selection of candidates. In addition, OIA lacks direct hire  authority for its intelligence analysts. According to OIA officials, these  challenges make OIA’s hiring process more complicated and lengthier than  those of other agencies in the Intelligence Community.
section_title: TFI Has Not Yet Developed an Appropriate Set of Performance Measures, but Continues to Work to Improve Its Efforts
paragraphs: TFI has not yet developed an appropriate set of performance measures,  but continues to attempt to improve its efforts. Since TFI was formed, its  individual performance measures have varied substantially in number and  the extent to which they address attributes of successful performance  measures that GAO has identified. For fiscal year 2008, the performance  measures of TFI’s components vary in the extent to which they address  attributes of successful performance measures identified by GAO.  TFI’s  performance measures address many, but not all, of these attributes.   According to Treasury officials, TFI recognizes the need to improve its  performance measures, and is developing a new set of measures to assess  its performance. However, our review of a draft version of these revised  measures suggests that some concerns would remain if they are  implemented as proposed.
subsections: section_title: Performance Measures Related to TFI Functions Have Varied over the Years
paragraphs: As shown in figure 4, since its formation in 2004, TFI’s performance  measures have varied over time. TFI reported on 11 total measures in  fiscal year 2005, 9 measures in fiscal year 2006, 10 measures in fiscal year  2007, and 20 measures in fiscal year 2008. The number and content of  performance measures have varied within components over time, as well.  For example, FinCEN had 6 measures in fiscal year 2007 and 16 in fiscal  year 2008. Components have frequently introduced new measures only to  discontinue them in subsequent years. For instance, OFAC reported 4  measures in fiscal year 2005, and then discontinued 3 for fiscal year 2006.  OIA, newly formed in 2004, reported 1 performance measure in fiscal year  2006 and none the following years. The extent of inconsistency in TFI’s  performance measures creates challenges for managers to using  performance data in making management decisions.
According to TFI officials, the sharp increase in the number of  performance measures reported in fiscal year 2008 was a response to the  evaluation and recommendations of the Office of Management and  Budget’s (OMB) Program Assessment Rating Tool (PART) in 2005 and  2006. The PART process identified potential enhancements to FinCEN’s  performance measures, leading to the inclusion of new measures for  FinCEN. FinCEN officials said that Treasury performance officials asked  that the newly developed measures be added to FinCEN’s contribution to  the fiscal year 2008 performance and accountability report. According to  officials in Treasury’s Office of Strategic Planning and Performance  Management (OSPPM), the nature of FinCEN’s work is operational,  making it easier to evaluate the bureau’s performance. TFI’s policy-making  components, such as TFFC, have found it more difficult to develop  meaningful performance metrics.
section_title: TFI’s Current Performance Measures Exhibit Many, but Not All, Attributes of Successful Performance Measures
paragraphs: The performance measures TFI currently has in place also vary in the  degree to which they exhibit the attributes of successful performance  measures. Prior GAO work has identified nine attributes of successful  performance measures. Table 1 shows the nine attributes, their definitions,  and the potentially adverse consequences of not having the attribute.
TFI’s performance measures address many of these attributes of  successful performance measures, but do not fully address other  attributes. Figure 5 represents our assessment of TFI’s 20 performance  measures versus the key attributes of successful performance measures.
According to our analysis, TFI’s 20 measures have many of the attributes  of successful performance measures, including the following.
Measurable target. All 20 of TFI’s measures have measurable, numerical  targets in place. Numerical targets allow officials to more easily assess  whether goals and objectives were achieved because comparisons can be  made between projected performance and actual results.
Limited overlap. We found limited overlap among TFI’s 20 measures, that  is, little or no unnecessary or duplicate information provided by the  measures.
Objectivity. We found all of TFI’s measures to be objective, or reasonably  free from significant bias.
Governmentwide priorities. We also determined that TFI’s 20 measures  are linked to broader priorities such as cost-effectiveness, quality, and  timeliness.
However, the measures did not fully satisfy the following attributes.
Linkage. Six TFI measures are not clearly linked to Treasury goals. For  example, TEOAF measures the proportion of its forfeitures that come  from high-impact cases. However, it is unclear why high-impact cases in  particular are measured as opposed to all cases. Our analysis could not  link TEOAF’s measure to broader agencywide goals related to removing or  reducing threats to national security.
Core program activities. Seven TFI measures do not sufficiently cover  core program activities. For example, OFAC has three main  responsibilities related to the administration of sanctions: (1) issuing  licenses, (2) designation programs, and (3) enforcement through civil  penalties. However, OFAC’s one performance measure only assesses cases  involving civil penalties resulting from sanctions violations.
Balance. We found that TFI’s set of performance measures is not  balanced. In fiscal year 2008, TFI reported on 20 measures, 16 of which  related to FinCEN’s programs and activities, 1 that related to OFAC, 1 that  related to TEOAF, 2 that related to TFFC, and none that related to OIA. As  a result, a disproportionate number of measures (16) relate to  administering and enforcing the BSA and none to the analysis of financial  intelligence. An emphasis on one priority at the expense of others may  skew the overall performance and preclude TFI’s managers from  understanding the effectiveness of their programs in supporting Treasury’s  overall mission and goals. In addition, the lack of balance exhibited by  TFI’s measures may give the impression that administering the BSA is  prioritized over other functions, such as the analysis of financial  intelligence or administration of licensing and designations programs.
section_title: TFI Is Working to Replace Its Performance Measures, but Some Concerns Remain
paragraphs: Treasury officials acknowledge the limits of TFI’s current performance  measurement and have been working to enhance its measures, by  replacing them with a single new TFI-wide measure. According to OSPPM  officials, they began an initiative to overhaul TFI’s performance  measurement in 2007. OSPPM officials stated that TFI’s performance  measures did not effectively reflect the impact of TFI’s activities. After  consultation with each TFI component, OSPPM decided to design a new  composite measure that will provide a way to assess how TFI is  performing overall as a unit. The new measure would outline the roles and  functions of TFI’s components and evaluate the outcomes of their  activities. However, the process of reforming TFI’s performance  measurement has not been completed. The implementation of the new  measure is still uncertain, although TFI management approved its use in  May 2009 and components finalized the measures they will contribute.
According to a Treasury official, OSPPM decided on the format of the new  composite measure after researching other federal agencies’ approaches  to performance measurement, as well as those of management  consultancies in the private sector. The composite measure takes a similar  form to the measure implemented for Treasury’s Office of Technical  Assistance (OTA), first reported in Treasury’s fiscal year 2008 performance  and accountability report. The measure aims to provide a more  comprehensive snapshot of the outcome of OTA’s activities by measuring  impact and traction.
The composite measure for TFI will align the two Treasury outcomes that  relate to their activities with TFI’s performance goals and focus areas,  according to Treasury. Each focus area corresponds with a TFI  component (OFAC, OIA, TFFC, and FinCEN). The components will track 3  to 6 performance measures and will assign a numeric score to the  performance at the end of the year. Each component’s measures will be  combined to reach an overall score for the component. In the end, an  overall score for TFI will be determined by averaging the individual scores  of the components.
All TFI components except TEOAF have been involved in the process of  developing the composite measure. Both OSPPM and TEOAF officials  stated that TEOAF would not be included, since its work did not logically  fit in one of the focus areas. OIA, TFFC, and OFAC have developed new  measures to assess the impact of their activities. FinCEN will use 5 of its  existing measures for its contribution to the composite measure.
TFI faces significant challenges in developing and implementing the new  composite measure. There is an inherent difficulty in creating quantitative  measures for policy organizations, whose activities may not be easily  represented with numbers. Many TFI managers pointed to the difficulty of  making qualitative information measurable for performance reporting.
While the initiative to improve TFI’s performance measurement is a  positive step, our preliminary analysis raises concerns regarding the extent  to which the new TFI composite measure will allow full and accurate  assessment of TFI’s performance. For example, we identified the following  concerns:    Objectivity and reliability of survey-based measures. OIA has developed  surveys to measure the timeliness, relevance, and accuracy of its  intelligence support, all-source analysis, and security and  counterintelligence. The survey respondents are internal customers of  OIA’s products within Treasury such as the Deputy Secretary, Under  Secretaries, Assistant Secretaries, Deputy Assistant Secretaries, and senior  staff. The objectivity of the surveys is not clear given that respondents’  answers may be biased because they have a vested interest in the  outcome, as it is a reflection on their performance. The reliability of the  measures is also questionable, as only between 7 and 13 internal  customers—rather than external customers in the Intelligence  Community—will be asked to complete the survey. TFI believes that while  there is no perfect method for evaluating OIA’s performance, the surveys  are an effective means for Treasury policymakers to assess OIA’s  performance. They also noted their plan to survey customers in other parts  of the Intelligence Community in 2010.
Lack of validation for some components’ self-assessment-based  measures. Some components’ performance measures rely exclusively on  self-assessments by component managers and lack external verification.  For example, TFFC has 4 measures for which management will compile  supporting information and assign a high, medium, or low rating for  TFFC’s performance in that area. Treasury and TFI acknowledge (but have  not yet addressed) a lack of a process to independently verify TFFC’s self- assessment. OTA’s composite measure, which OSPPM officials cited as  similar to TFI’s, also uses elements of self-assessment, but those results  are independently validated by an external source and reviewed by  Treasury.
Calculation of overall TFI score. According to TFI, to calculate the  composite measure, individual components’ results will be averaged into a  single TFI measure. Since the components are not all contributing the  same number of measures to the overall composite measure, averaging  components’ scores means components’ individual performance measures  are not weighted equally in TFI’s overall measure.
section_title: Conclusions
paragraphs: Since its creation in 2004, TFI has undertaken a variety of activities to  address a broad range of national security threats, such as enhancing the  use of financial intelligence against terrorism and the proliferation of  weapons of mass destruction. In addition, TFI and its components have  taken some steps toward more effective management of TFI as an  organization. For instance, TFI and some components have developed  strategic plans and have performed workforce planning activities.
Nonetheless, TFI has not fully utilized some management tools to create  an integrated organization with a consistent, well-documented approach to  planning and managing its operations. As a result, additional opportunities  for improvement exist. First, despite the critical role interagency  collaboration plays in many of TFI’s functions and general approval by key  interagency partners, such collaboration may not be as effective as it could  be in certain respects. TFI and some of its interagency partners had  strikingly different perceptions about the quality of collaborative efforts  involving multilateral forums. Lacking clearly documented policies and  procedures for collaboration in this area, interagency partners were  unsure how to resolve their differences. Without a mechanism to monitor  and report on the results of such interagency collaboration, TFI officials  were generally unaware that differences existed or what impact they might  be having, and thus saw no need to take steps to understand or address  them. Second, TFI management has not clearly aligned its resources with  its priorities. Without clear, consistent objectives and an understanding of  how resources are aligned with them, it may be unclear to Congress, TFI’s  interagency partners, or even TFI staff what TFI’s priorities are and  whether TFI has sufficient resources to address them. In addition, while  some components have undertaken workforce planning activities, TFI  management has yet to implement a comprehensive strategic workforce  planning process for TFI as a whole. As a result, TFI may be at risk of not  having the workforce required to address future national security threats.  Finally, TFI’s performance reporting has been uneven. Though TFI has  been working to improve its ability to effectively measure its performance  as a unit, TFI has not yet developed a set of performance measures that  embody the attributes of successful performance measures. Without a set  of effective performance measures, it is difficult to judge how well TFI is  achieving its mission.
section_title: Recommendations for Executive Action
paragraphs: To help strengthen Treasury’s ability to achieve its strategic goal of  preventing terrorism and promoting the nation’s security through  strengthened international financial systems, we recommend that the  Secretary of the Treasury direct the Under Secretary for Terrorism and  Financial Intelligence to take the following four actions:  1.  develop and implement, in consultation with interagency partners  participating in international forums related to anti-money laundering  and counterterrorist financing issues, (a) compatible policies,  procedures, and other means to operate across agency boundaries and  (b) a mechanism for monitoring, evaluating, and reporting on  interagency collaboration;  2.  develop and implement policies and procedures for aligning resources  with TFI’s strategic priorities;  3.  develop and implement a TFI-wide process, including written  guidance, that addresses the key principles of strategic workforce  planning; and  4.  ensure that TFI’s performance measures exhibit the key attributes of  successful performance measures.
section_title: Agency Comments and Our Evaluation
paragraphs: We provided a draft copy of this report to the Departments of the  Treasury, State, and Justice.  Justice and State declined to provide  comments.  Treasury provided comments, which are reprinted in appendix  IV.
Treasury’s comments highlighted what it views as TFI’s significant  contributions since 2005. Treasury said that TFI has helped reduce the  threat of terrorist financing, stating that al Qaeda is in its worst financial  position in at least 3 years.  In addition, Treasury highlighted TFI’s efforts  to counter the financing of proliferation, for example, using Executive  Order 13382 to isolate banks, companies, and individuals tied to North  Korean, Iranian, and Syrian proliferation.
Treasury’s comments also discussed ongoing or planned actions related to  our four recommendations:
With regard to our recommendation that TFI develop and  implement policies and procedures to operate across agency  boundaries and develop a mechanism for monitoring, evaluating,  and reporting on interagency collaboration, the Under Secretary  for Terrorism and Financial Intelligence indicated that his  counterparts in other agencies have never expressed concerns  about process or substance to him regarding TFI’s collaboration.   Nonetheless, Treasury stated that it would redouble its efforts to  coordinate with other agencies, but did not identify specific steps it  plans to take.  As discussed in our report, we recommend that such  steps include developing clear policies for conducting and  monitoring the results of interagency collaboration.
In response to our recommendation to develop and implement  policies and procedures for aligning resources with TFI’s strategic  priorities, Treasury indicated that TFI is working to improve its  processes in this area.  While Treasury stated that its use of the  annual budget process has worked well to match resources to  strategic goals, we have concluded that the annual budget process  does not necessarily reflect TFI’s strategic priorities, in part  because it reflects priorities for only a given year and not longer- term priorities.
In relation to our recommendation to develop and implement a  TFI-wide process to address the key principles of strategic  workforce planning, Treasury commented that it is working with  Johns Hopkins University’s Capstone Consulting to develop a  workforce planning model for Treasury.  As a part of this effort,  TFI plans to develop and disseminate written guidance establishing  a process to align resources with TFI and Treasury strategic goals  in the next 12 months.
Finally, Treasury stated that it will work to implement our  recommendation to ensure that TFI’s performance measures  exhibit the key attributes of successful performance measures.  At  the same time, Treasury contends that TFI’s true performance will  often be best conveyed through briefings to those who possess the  appropriate security clearances.  To ensure that such briefings  provide systematic evidence regarding TFI’s performance, they  should include assessments based on performance measures that  exhibit the key attributes of successful performance measures  discussed in this report.  Further, we would note that using  classified information to help assess TFI’s performance does not  preclude TFI from developing unclassified performance measures  or from producing an unclassified assessment of its performance.   In fact, Treasury’s statements about the financial condition of al  Qaeda referenced in its response to this report provide Treasury’s  assessment of TFI’s impact on al Qaeda without disclosing  classified information.
As agreed with your office, unless you publicly announce the contents of  this report earlier, we plan no further distribution until 30 days from the  report date.  At that time, we will send copies of this report to the  appropriate congressional committees as well as the Secretaries of the  Treasury, State, and Justice.  We will make copies available to others upon  request.  In addition, the report will be available at no charge on the GAO  Web site at http://www.gao.gov.
If you or your staff has any questions about this report, please contact me  at (202) 512-4347 or YagerL@gao.gov. GAO staff who contributed to this  report are included in appendix V.
section_title: Appendix I: Scope and Methodology
paragraphs: To analyze the Office of Terrorism and Financial Intelligence’s (TFI) use of  its tools to address national security threats, we reviewed Treasury reports  and documents related to its efforts since 2004. For example, we reviewed  all of Treasury’s performance and accountability reports and FinCEN’s  annual reports since TFI was formed. We also reviewed other documents  discussing activities involving TFI, including the National Money  Laundering Strategy and the National Strategy for Combating  Terrorism. To identify practices for enhancing interagency collaboration,  we reviewed prior GAO reports. We then interviewed officials from  Treasury and its key interagency partners (the Departments of State and  Justice) to understand TFI’s processes for interagency collaboration.
To analyze TFI’s efforts to conduct strategic resource planning, we  reviewed a variety of Treasury documents. To identify TFI’s priorities, we  reviewed documents such as Treasury’s performance and accountability  reports, congressional testimony by the Under Secretary for Terrorism and  Financial Intelligence, and TFI’s Web site. In addition, we reviewed  documentation from TFI and its components related to strategic planning,  including the current strategic plans for TFI and each component. Further,  we reviewed TFI data regarding the number of staff (full-time equivalents  or FTE) in each TFI component for fiscal years 2005 through 2008. We  then obtained data from TFI components to illustrate how their workload  has changed over time. We determined that these data are sufficiently  reliable for the purpose of this report. Additionally, we reviewed prior  GAO work related to principles of effective strategic workforce planning.  To determine the extent to which TFI’s practices reflect these principles,  we interviewed TFI management, including the Under Secretary for  Terrorism and Financial Intelligence and managers from TFI components.  Further, we interviewed officials from Treasury’s Office of the Deputy  Assistant Secretary for Human Resources and Chief Human Capital  Officer.
To analyze the extent to which TFI’s performance measures provide an  effective assessment of TFI’s performance, we reviewed Treasury’s  reporting on TFI’s performance. Specifically, we analyzed the performance  measures contained in Treasury’s performance and accountability reports  for fiscal years 2005 through 2008. We also evaluated TFI’s performance  measures for fiscal year 2008 against key attributes of successful  performance measures. To perform this evaluation, two analysts  independently assessed each of the performance measures against the  nine attributes identified in the specifications for each attribute included  in that report. Those analysts then met to discuss and resolve any  differences in the results of their analyses. A supervisor then reviewed and  approved the final results of the analysis. To obtain information on TFI’s  process to improve its set of performance measures, we interviewed  officials from each TFI component and Treasury’s Office of Strategic  Planning and Performance Management. We also obtained a copy of draft  TFI performance measures that will be presented to the Office of  Management and Budget for its review. We then interviewed officials from  each TFI component and Treasury’s Office of Strategic Planning and  Performance Management regarding how the data for these draft  performance measures would be obtained and how the overall TFI  composite measure would be developed.
We also present data on TFI staffing and budget for fiscal years 2005  through 2008. As these data are presented for background purposes, we  did not assess their reliability.
section_title: Appendix II: Current U.S. Sanctions Programs
paragraphs: Appendix II: Current U.S. Sanctions Programs Office of Foreign Assets Control country-based sanctions programs  Office of Foreign Assets Control list-based sanctions programs  Liberia (former regime of Charles Taylor)
section_title: Appendix III: GAO Assessment of TFI’s Fiscal Year 2008 Performance Measures
subsections: section_title: Yes
section_title: Appendix IV: Comments from the Department of the Treasury
section_title: Appendix V: GAO Contact and Staff Acknowledgments
subsections: section_title: Staff Acknowledgments
paragraphs: In addition to the individual named above, Jeff Phillips (Assistant  Director), Jason Bair, Lisa Reijula, Katherine Brentzel, Martin de Alteriis,  and Mary Moutsos made key contributions to this report. Elizabeth Curda,  Karen Deans, Cardell Johnson, Barbara Keller, and Hugh Paquette also  contributed to the report.