Members of Congress Seek GAO Study On Variety of BSA Issues
WASHINGTON -- House Financial Services Committee leaders have requested a Government Accountability Office study of the mission and operational capacity of Treasury's Financial Crimes Enforcement Network and the increasing number of Bank Secrecy Act-related filings.
The request to the GAO was prompted by issues raised at a May 10, 2007 hearing in the Subcommittee on Oversight and Investigations, which was the first of a series of hearings on the subject of balancing law enforcement utility and regulatory requirements of BSA reporting. FinCEN was initially envisioned as a government-wide, service-oriented, financial information-sharing agency, the letter signed by House Financial Services Committee Chairman Barney Frank (D-Mass.), Ranking Member Spencer Bachus (R-Ala.), and committee member Stephen Lynch (D-Mass.) said. With law enforcement now being able to collect all this information on its own, duplication of efforts is a possibility, the letter pointed out.
Additionally, the three lawmakers expressed concern over the Suspicious Activity Report process. FinCEN has reported over one million SARs filed in 2006 with depository institutions and securities and futures firms accounting for more than half. The hearing revealed that clear guidance was not available on what agencies looked for in examinations resulting in defensive filing. The agencies have since issued a statement in attempt to clarify and provide guidance that was hailed by FinCEN Director James Freis. The letter also asked GAO to look into the affect of the BSA/AML Examination Manual on the examination process.
Finally, Frank, Bachus, and Lynch asked for an analysis of the cumulative effect of BSA reporting requirements.