FinCEN Issues a Geographic Targeting Order for Miami-Area Businesses
A Geographic Targeting Order (GTO) is one of the major enforcement tools of the Financial Crimes Enforcement Network (FinCEN). Such orders are issued under the authority of the Bank Secrecy Act and are used to impose stricter reporting and recordkeeping requirements on entities in localities the government believes to be ripe for money laundering, drug trafficking, or terrorist financing.
On April 21, 2015, FinCEN issued a GTO targeting approximately 700 Miami businesses centered in the zip codes surrounding the international airport. FinCEN hopes to isolate transactions used primarily by drug cartels to launder proceeds entering the country. Effective April 28, 2015, the GTO requires non-financial Miami businesses that receive a formal notice to file a Form 8300 with FinCEN if they process more than $3,000 in cash from individuals in single or multiple transactions. This threshold is reduced from the ordinary $10,000 reporting requirement for financial entities. Additionally, businesses subject to the GTO must include contact information about the persons involved in the transactions. Failure to comply with these restrictions could result in significant criminal and civil penalties. The GTO will remain in effect until October 25, 2015, but entities subject to the GTO must retain relevant records for at least five years thereafter.
The Miami GTO comes on the heels of last year’s dragnet of over 2,000 businesses in the Los Angeles area that netted $90 million in cash seizures and $30 million in bank account seizures in the city’s fashion district. The Miami GTO displays FinCEN’s continued willingness to utilize the enforcement tool to combat large-scale money-laundering operations.