Legal Definitions - Financial Crimes Enforcement Network

Financial Crimes Enforcement Network (FinCEN)

The Financial Crimes Enforcement Network (FinCEN) is a bureau within the U.S. Department of the Treasury. Its primary mission is to safeguard the U.S. financial system from illicit use, combat money laundering, and promote national security through the collection, analysis, and dissemination of financial intelligence. Essentially, FinCEN acts as a central hub for financial information, supporting law enforcement agencies in their efforts to detect and prevent various financial crimes, both within the United States and across international borders.

• Example 1: Detecting Money Laundering

  A major bank in New York notices an unusual pattern of large, frequent wire transfers from a newly opened business account to several offshore accounts, despite the business having no clear operational history. Following federal regulations, the bank files a Suspicious Activity Report (SAR) with FinCEN. FinCEN then analyzes this report, cross-referencing it with other SARs and financial data, and discovers similar patterns linked to other businesses. This intelligence is then shared with the FBI, which uses it to launch an investigation into a sophisticated international money laundering ring.

  This example illustrates FinCEN's role in collecting vital financial intelligence (like SARs) and analyzing it to identify and support law enforcement efforts against domestic and international financial crimes, specifically money laundering.

• Example 2: Combating Terrorist Financing

  After an international incident, intelligence agencies suspect a specific individual is attempting to funnel funds to an overseas terrorist organization. They alert FinCEN, which then utilizes its extensive database of financial transactions and its network of international partners to trace the individual's financial activities. By analyzing bank records, cryptocurrency transactions, and other financial data, FinCEN helps pinpoint the source and destination of the funds, providing critical intelligence to disrupt the terrorist financing network.

  Here, FinCEN demonstrates its function in supporting national security by actively tracking and disrupting financial flows related to international terrorist financing, working with both domestic and international law enforcement and intelligence agencies.

• Example 3: Enforcing Sanctions Compliance

  A U.S. company is suspected of using a complex web of shell companies and intermediaries in different countries to secretly sell goods to an entity in a nation under strict U.S. economic sanctions. FinCEN, in collaboration with the Office of Foreign Assets Control (OFAC), investigates the financial transactions. By meticulously following the money trail through various bank accounts and corporate filings, FinCEN uncovers the hidden connections and provides crucial evidence to federal prosecutors, enabling them to pursue charges for sanctions evasion.

  This scenario highlights FinCEN's role in supporting law enforcement against financial crimes related to sanctions violations, using its expertise in financial analysis to uncover complex schemes designed to circumvent U.S. policy.