Funds Needed to Hunt Oligarch Assets, Combat Kleptocracy and Fight Financial Crime
WASHINGTON, DC – Today, the Senate Appropriations Committee released its draft appropriations bills for fiscal year 2023 that provided just $189 million to the Financial Crimes Enforcement Network (FinCEN). FinCEN is the bureau of the Treasury Department that serves as the nation’s financial intelligence unit, anti-money laundering standard setter, and main institution responsible for implementing many of the domestic reforms included in the Administration’s inaugural U.S. Strategy on Countering Corruption. Chief among these reforms tasked to FinCEN are implementing the Corporate Transparency Act to end the abuse of anonymous U.S. shell companies, as well as drafting rules to counter money laundering in the $50 trillion real estate and $11 trillion private investment markets.
While it is an increase above FY2022 enacted levels, the Senate figure falls short of the funding approved last week by the House and requested by the President by a sum of $21 million. Notably, the Senate package would fully fund the Office of Terrorism and Financial Intelligence, which oversees the U.S. sanctions office, at the $212-million level requested by the President.
Ian Gary, Executive Director of the FACT Coalition, said in a statement:
“Though Senate appropriators have touted the importance of tracking, freezing, and seizing Russian oligarch funds in wake of the illegal invasion of Ukraine, the funding bill released today sends the wrong signal by short changing U.S. financial crime fighters. A strengthened FinCEN is needed to feed actionable information to interagency and international investigations. Finding oligarch assets requires modern investigative tools, including those that FinCEN is tasked with implementing as part of the U.S. Strategy on Countering Corruption.
“To improve America’s national security footing and empower our nation’s financial crime fighters, the Senate should increase FinCEN appropriations to match the $210.33 million passed last week by the House for fiscal year 2023.
“With more funding comes more responsibility for FinCEN. To help FinCEN meet its mandate and deliver on crucial rulemakings, Congress has already approved historic discretionary and one-time funds in the past year that have nearly doubled the short-term funding of the bureau.
“If FinCEN receives the additional requested funds from Congress, it will have no excuse if it continues to delay rulemakings on the bipartisan Corporate Transparency Act, the completion of which was supposed to take place earlier this year. With new resources, FinCEN must accelerate implementation of the Corporate Transparency Act to help end the scourge of anonymous shell companies used to commit financial crimes.
“Further, the Senate – in a statement accompanying its funding proposal – has given FinCEN a strong mandate to finally move forward on long-overdue reforms to safeguard the U.S. real estate and private investment markets from being a dumping ground for dirty money.
“The modern threats to global democracy demand that FinCEN receive further resources to deny kleptocrats, human rights abusers, and criminals access to the U.S. financial system. We appreciate work by Sens. Patrick Leahy (D-VT), Chris Van Hollen (D-MD), Richard Shelby (R-AL), and Cynthia Hyde-Smith (R-MS) to secure crucial funds for FinCEN, and encourage them to prioritize this bureau in funding negotiations to come.”
Note to the Editor:
- Click here for the draft text of the Senate appropriations bill, which includes $189 million for FinCEN. The Committee also provided a bill summary and explanatory statement, the latter of which underscores the need for FinCEN to finalize rules tackling money laundering through anonymous U.S. shell companies, real estate, and private investment.
- Click here for FACT’s reaction to June Senate Appropriations testimony by Treasury Deputy Secretary Wally Adeyemo, calling for increased congressional funding for FinCEN for the purposes of anti-money laundering reform.
- FinCEN received emergency appropriations as part of two Ukraine packages earlier this year, as a means to backstop efforts to “freeze and seize” Russian oligarch assets.
- A recent 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.
- FACT Sheet for Congress on Emergency Treasury Funding Needs re: Ukraine Crisis and FY2023.