Discretionary Budget Request Represents 20 Percent Increase for Financial Crimes Enforcement Network
WASHINGTON, DC – Today, President Biden presented Congress with his discretionary budget request for fiscal year 2024, which outlines what funding the Administration deems necessary to achieve its policy goals. The budget includes $229 million – a 20 percent increase above previously enacted levels – for the Financial Crimes Enforcement Network (FinCEN). FinCEN is the bureau of the Treasury that serves as the financial intelligence unit of the U.S., and is responsible for advancing anti-money laundering reforms to safeguard the U.S. financial system.
Chief among these reforms is the timely implementation of the Corporate Transparency Act (CTA), which would end the abuse of anonymous U.S. shell companies by domestic and transnational criminals. FinCEN closed comments on the second rule to implement the CTA last month, but at least one additional rulemaking remains before the law can be fully implemented. The agency is also considering landmark reforms – prioritized by the White House in the first ever U.S. Strategy on Countering Corruption – to tackle money laundering in the $50 trillion real estate and $11 trillion private investment markets.
Erica Hanichak, Government Affairs Director of the FACT Coalition, said in a statement:
“The new budget from the President prioritizes resourcing for our nation’s financial crime fighters, who are responsible for advancing long-overdue rules to close loopholes in the U.S. anti-money laundering framework. The big question now is whether Congress will deliver.
“Policymakers and the public alike are increasingly concerned about illicit financial flows that are weaponized against U.S. national security and democracy worldwide – whether they be from Russia in the wake of the invasion of Ukraine, China, or elsewhere. One of the best steps that Congress can take to tackle dirty money is to fund the bureau of the Treasury responsible for crafting rules to root it out.
“This shouldn’t be a question of politics: it’s a matter of national security. FinCEN is up against a flood of dirty money finding its way into the U.S., which Treasury estimates is equal to 2 percent of U.S. GDP. New resources for FinCEN would ensure the bureau has what it needs in terms of staff, licenses, and technology to keep our financial system safe.
“FinCEN has a big job ahead, as the Administration has tasked it with addressing the U.S.’s status as a premier destination for the world’s illicit funds. To achieve this goal, in part, FinCEN must fully and faithfully implement the Corporate Transparency Act. This includes rescinding a proposed form that – while seemingly innocuous – could make the entire reporting regime of this bipartisan law optional. By rescinding this form, FinCEN would be taking a major step toward ensuring that the law is effective in keeping dirty money out of the U.S.”
Notes to the Editor:
- Click here for the FY2024 President’s discretionary spending request (p. 114 / 118).
- Bipartisan members have publicly supported significant funding increases for FinCEN. Last Congress, there were bipartisan letters in the House led by Rep. Spanberger (D-VA) and the Senate by Sen. Whitehouse (D-RI).
- A 2022 Transparency International report, “Up to the Task?: State of Play in Countries Committed to Freezing and Seizing Russian Dirty Money,” demonstrates how U.S. funding for FinCEN stacks up against that of U.S. allies.
- Click here for FACT’s release on the second draft access rule, to see what necessary reforms must be included before FinCEN finalizes the draft rule.
- Click here for a link to the FinCEN Notice of Proposed Rulemaking on the reporting entity form, due March 20. See op-eds from the Tax Law Center and Transparency International-US outlining why this form is so dangerous to the efficacy of the CTA.