Federal Budget Cut Could Curtail State, Local Money Laundering Probes


A looming cut to the federal financial crime agency's budget could cripple state and local investigations that depend on transactions monitored via the anti-money laundering Bank Secrecy Act, Reuters reports. The Treasury Department's Financial Crimes Enforcement Network (FinCEN) decided to save nearly $1.4 million by doing away with jobs that facilitate state and local law enforcers' access to the coveted data, often used in fighting drug trafficking, fraud and terrorism finance. “For very, very small savings, we're looking at having a very major negative impact on investigations,” Cameron Holmes of the Arizona Attorney General's Office, told Complinet. “It is far, far, far out of proportion to the savings.”

The data include reports that financial institutions like banks, broker-dealers, and money services firms file on transactions deemed suspicious, or those involving large amounts of cash. Millions of such reports are filed with the Treasury Department each year and are stored electronically in FinCEN databases. Financial investigators and others rely on these documents to help them track suspicious money flows. In recent years, investigators with federal, state and local law enforcement agencies have been able to access Bank Secrecy Act data instantly online at their workstations. FinCEN spokesman Steve Hudak said that as a result of deficit concerns, all federal agencies were asked to “prioritize their capabilities.”

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