The Financial Crimes Enforcement Network (FinCEN) has published a press statement to inform about its recently hosted FinCEN Exchange and to encourage financial institutions of all kinds (banks, payment service providers, virtual asset dealers / brokers / platforms, investment firms, brokers, (private equity) fund managers etc.) to participate in the Exchange.
Specifically, this recent meeting primarily focused on countering the misuse of the digital ecosystem by the Democratic People’s Republic of Korea (DPRK). The DPRK utilizes virtual assets to fund its illicit weapons programs posing a significant threat to the U.S. financial system. During the session, FinCEN and Federal law enforcement agencies presented related information, followed by discussions on information sharing mechanisms. Financial institutions and representatives from the virtual currency industry discussed strategies to combat DPRK’s cyber-enabled illicit finance.
The FinCEN Exchange program underscores the importance of communication between FinCEN, law enforcement, and financial institutions to identify and investigate criminal actors and money laundering. As FinCEN notes, financial institutions play a crucial role in supporting law enforcement and national security agencies through suspicious activity reporting which is why the Network urges financial market players to register under USA PATRIOT Act Section 314(b) and engage in voluntary information sharing. This collaborative approach can uncover networks of illicit activity that individual firms may miss. In fiscal year 2022, over 7,600 financial institutions were registered under Section 314(b), enabling extensive network analysis and thus preventing money laundering and the financing of terrorism on a large scale.
To provide further details on the registration, FinCEN has attached its latest Section 314(b) Fact Sheet which describes which financial market participants (i.e. fund management companies, brokers, banks, etc.) are eligible for information sharing and the type of information that may be shared pursuant to section 314(b) of the Bank Secrecy Act for purposes of the prevention of money laundering and the financing of terrorism.