HomeRegulatorsFinancial Crimes Enforcement Network (FinCEN)

Financial Crimes Enforcement Network (FinCEN)

On this page, you will learn about the advantages that FinCEN (Financial Crimes Enforcement Network) brings to the US economy. The areas we cover include their importance, responsibilities, and the crimes they deal with. Understanding FinCEN's work will help you have more trust in the US economy and the money transfer companies that operate there. Consequently, you will have peace of mind when sending money to the United States.

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What Is FinCEN?

The Financial Crimes Enforcement Network is a United States Department of the Treasury bureau that fights domestic and international terrorist financing, money laundering, and other financial crimes. They do this by collecting and analyzing information about financial transactions.

The headquarters of FinCEN is in Vienna, Virginia, and the agency executive is Ken Blanco. They have an annual budget of $114.2 million based on 2018 data. Also, the agency was formed on April 25th, 1990.

FinCEN comprises three parts: the financial services community, regulatory community, and law-enforcement agencies. Furthermore, FinCEN is the US representative in the Egmont Group, which consists of 100 intelligence agencies. In the next section, we will share their top responsibilities to get a better idea of their vital work in promoting the health of the US economy.

What Is the FinCEN Responsible for?

This section highlights the primary responsibilities of FinCEN. This allows consumers of money transfer companies to understand better how their work will impact the experience of sending money to the United States. You will see that FinCEN is a valuable cog in the US economy that contributes to the fair nature of the financial markets.

Top responsibilities of FinCEN:

  • Stop crimes: FinCEN does not track financial transactions to prevent and punish financial transactions, including money laundering. Instead, the organization works with other regulators to cooperate on information to track down individuals that are flagged for wrongdoing.

  • Tracks suspicious individuals: financial institutions must provide mandatory disclosures of suspicious individuals. FinCEN investigates these reports and researches the individuals flagged for suspicious activity.

  • Congress: FinCEN gets its orders from Congress, and the Treasury Secretary appoints the director.

  • Cybersecurity: part of FinCEN's responsibilities includes reducing the number of successful cybersecurity events. For example, they are cracking down on ransomware attacks that lock users out of their computers until a ransom is paid. Cybersecurity has become one of the biggest problems in the financial service industry in recent years.

Financial crimes typically leave a trail. Following this trail is the job of FinCEN to ensure they can find the suspects of wrongdoing in the US financial markets. Unfortunately, this process can take a long time, depending on the sophistication of the strategy used by the criminals. Therefore, sharing information with other regulators, law enforcement agencies, and partners helps reduce the time required to find bad actors.

The Importance of FinCEN

Now let us take a closer look at why FinCEN is a critical organization. This enables you to determine why they are among the top most vital government-backed organizations in the United States. This information is relevant to consumers of money transfer companies that want to understand better what security mechanisms are in place in the US economy.

  • Trust: FinCEN's work promotes consumer trust in the US economy. By reducing the number of criminal activity in the financial markets, users can have more confidence that the financial service companies they use will not get shut down because of malpractice.

  • Growth: as more people trust the economy, they are more willing to use the financial service and deposit money. This drives the economy forward and promotes growth. Without trust, economic activity would slow down and cause financial institutions to reduce the quality of the service they can offer.

  • Reduces crime: increasing the difficulty with which criminals can launder money and pursue other financial crimes reduces overall crime in the US. Those criminals will need to go elsewhere to find the loopholes they need to operate.

An example of FinCEN in action is when they announced a $140 million civil money penalty against USAA Federal Savings Bank for Bank Secrecy Act violations. The bank in question failed to implement the correct anti-money laundering countermeasures, and they did not share timely information about a large number of suspicious transactions.

FinCEN Regulations

This section shares the regulations, crimes, and industries relevant to FinCEN. This enables consumers of money transfer companies to figure out how FinCEN impacts their experience. You can also learn about their scope and limitations.

Regulations: FinCEN operates under various regulations, including the Bank Secrecy Act of 1970. The act was created to prevent criminals from using financial institutions as tools to launder money.

The rules and regulations of FinCEN update over time to meet the challenges of constantly changing technology. For example, as cybersecurity has become more of a threat, the resources spent to prevent this fraud have increased.

Crimes: FinCEN deals with a wide range of financial crimes, which include money laundering, cyber security, narcotics trafficking, identity theft, tax evasion, and much more. They collaborate with other US regulators, so they assist in almost every type of crime that is committed.

Industries: FinCEN mainly deals with financial institutions, but their work might overlap with other sectors as they collaborate with different regulators. Bank and money transfer companies like Wise, WorldRemit, and Xe are among the responsibilities of FinCEN.

Accountability: FinCEN is accountable to Congress and the United States Government. They have to provide reports to Congress, and Government organizations decide on the director of the organizations.

What Regions Does FinCEN Cover?

FinCEN mainly covers the US economy's financial institutions, but they also work with international partners to provide and receive intelligence. This means they operate globally to ensure the US economy is protected from bad actors abroad.

They additionally oversee international money transfer companies that operate in the US. Therefore, if bad actors use your transfer provider of choice, the FinCEN will step in and finance the individual or company in question.

When Might You Encounter FinCEN?

You might encounter FinCEN if you are flagged for suspicious money transfers. For example, you might be asked to provide documentation or reasons for your transfers. You may also contact the organization indirectly if your chosen money transfer company has problems with FinCEN.

Can FinCEN Make New Rules?

FinCEN can make new rules in their areas of expertise. The rules relate to how financial institutions operate in the US economy. It also changes how information is stored and shared about financial transactions in the US economy.

How to Contact FinCEN

Now let us take a look at the contact details for FinCEN. You may wish to get in touch with them to share a suspicious activity or better understand how they police the US financial markets.

Other Regulators

Bottom Line

To summarize, FinCEN does essential work to reduce the ability of criminals to use the US economy to launder their money or conduct other financial crimes. In addition, they work with other regulators, partners, and international organizations to catch criminals and oversee financial institutions. This should give money transfer customers peace of mind when using the US financial markets.

We encourage our readers to continue learning more about the process of sending money to the United States. You can start with Send Money to the USA and Send Money to the USA from the United Kingdom. These guides will help you choose the best money transfer companies for getting the best FX rates and lowest fees.

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Martynas Pupkevicius
Martynas Pupkevicius
Martynas is a seasoned freelance writer that has written on a broad range of topics over his 10 year career. He enjoys diving into the research and sharing what he's learned with readers.