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8/25/2011 12:12:37 PM
MSBs Reminder: Provide List of Agents to FinCEN

IMPORTANT NOTICE FOR MSBs


August 24, 2011


REMINDER - In a letter dated April 27, 2011, the Financial Crimes Enforcement Network (FinCEN) requested the list of agents from money services businesses (MSBs), who reported, in Part IV, Item 29 of the registration form that they have one or more agents authorized to conduct business on their behalf. The letters were sent to the Owner or Controlling Person, as reported to FinCEN, on its most current Form 107, Registration of Money Services Business (RMSB). Pursuant to our authority contained in 31 CFR § 1022.380(d), MSBs were required to send their agent list to FinCEN, by June 20, 2011. If an MSB reported it has agents on its RMSB and has not provided a list of its agents to FinCEN, please provide your list using the following template http://www.fincen.gov/financial_institutions/msb/agentrequest.html and email it to agentrequest@fincen.gov.


If an MSB inaccurately filed its most current RMSB and does not have agents, we request that you respond, via email to agentrequest@fincen.gov noting that you do not have agents. You must also file a corrected RMSB. FinCEN recently announced that MSBs can now file RMSBs electronically. Accordingly, as the response due date for this request has passed, MSBs are strongly encouraged to file their corrected RMSBs electronically. The electronic RMSB can be used to file not only initial registrations, but also renewals, re-registrations, and corrections.


To file a correction, you will need the Document Control Number (DCN) that is noted in your original registration acknowledgement letter. DCNs can also be obtained by calling the IRS's Enterprise Computing Center at 866-270-0733. To file a corrected RMSB, access the BSA E-Filing System's website, at http://bsaefiling.fincen.treas.gov, complete the RMSB form in its entirety, paying particular attention to Part I of the form, by checking box "c" and either a, b, or d, as appropriate. Complete Part IV item 29 by recording a zero in each box where you previously reported agents. E-Filers will receive electronic notification of the transmission and receipt of the submission.


MSBs required to register with FinCEN must maintain a list of agents, and make the list of agents available to FinCEN, upon request. See 31 U.S.C. § 5330(c) and 31 CFR § 1022.380(d). Failure to comply with agent list obligations is a violation of money services businesses registration requirements of the Bank Secrecy Act (BSA) and its implementing regulations. See 31 U.S.C. § 5330(e) and 31 CFR § 1022.380(e). As administrator of the BSA, FinCEN may impose civil money penalties for failure to comply with BSA registration requirements, in an amount up to $5,000 per violation. Each day a violation continues constitutes a separate violation. See 31 U.S.C. § 5330(e) and 31 CFR § 1022.380(e).


If you have already responded to the above request, we appreciate your attention to this matter and there is no follow-up action necessary.

9/2/2011 4:22:48 PM
Informational MSB Webinar 9/15/2011

Informational Webinar Announced
On FinCEN's Money Services Businesses Final Rule


The Financial Crimes Enforcement Network (FinCEN) today announced that it will hold an informational webinar on Thursday, September 15, 2011, from 3:00 to 4:00 p.m. EDT that will highlight the new regulatory requirements of the final rule, the intent and purpose of the rule and the regulatory expectations.


On July 21, 2011 FinCEN published "Definitions and Other Regulations Relating to Money Services Businesses" (76 FR 43585) ("The MSB Final Rule") in the Federal Register. This MSB Final Rule revises the definitions to clarify what activities subject a person to the BSA rules pertaining to MSBs. The final rule ensures that certain foreign-located MSBs with U.S. customers are subject to the BSA rules. The rule also updates the MSB definitions to reflect past guidance and rulings, current business operations, evolving technologies, and merging lines of business.


During the Webinar, FinCEN representatives will discuss:

  • the MSB Final Rule;
  • the intent and rationale behind the rule;
  • FinCEN's regulatory expectations.


MSB Final Rule Webinar
Date: Thursday, September 15, 2011
Time: 3:00-4:00 p.m. EDT

PC-based attendees will require: Windows® Server 2003 or newer
Macintosh®-based attendees will require: Mac OS® X 10.4.8 or newer
Click
here for a full list of system requirements.
This Webinar does not have a registration process.
When it is time for the Webinar to begin, attendees should join by navigating to the following link:
http://treas.yorkcast.com/webcast/Viewer/?peid=dc6ae9061c3a41e6abcd7c0a75c10a171d

9/2/2011 4:26:21 PM
OCEAN BANK EFERRED PROSECUTION AGREEMENT

Ocean Bank (“Ocean Bank&rdquo, the largest privately-owned state-chartered commercial bank headquartered in Florida, has entered into a deferred prosecution agreement (“the Agreement&rdquo with the U.S. Attorney’s Office in the Southern District of Florida to resolve charges that it willfully failed to establish an anti-money laundering program. Today’s Agreement is the result of an investigation into Ocean Bank’s handling of several of its customers’ accounts that included transactions involving Mexican currency exchange houses, commonly known as “casas de cambio” (“CDCs&rdquo, announced Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Mark R. Trouville, Special Agent in Charge, Drug Enforcement Administration (“DEA&rdquo, Miami Field Division, Jose A. Gonzalez, Special Agent in Charge, Internal Revenue Service, Criminal Investigation Division (“IRS-CID&rdquo, Fred A. Maas, Chief, Sunny Isles Beach Police Department James H. Freis, Jr., Director, Financial Crimes Enforcement Network (“FinCEN&rdquo , Sandra L. Thompson, Director, Division of Risk Management Supervision, Federal Deposit Insurance Corporation (“FDIC&rdquo, and Tom Cardwell, Commissioner, Florida Office of Financial Regulation (“OFR&rdquo.



Click here: http://www.justice.gov/usao/fls/PressReleases/110822-01.html

9/6/2011 2:21:59 PM
FinCEN Releases Identify Theft Report

FinCEN Examines Identity Theft-Related Suspicious Activity
Reports Filed by Securities & Futures Firms
Trends in Illicit Activity Uncovered


9.6.2011


VIENNA, Va. – The Financial Crimes Enforcement Network (FinCEN) today released its analysis of identity theft suspicious activity reports (SARs) filed by securities and futures firms that shows identity thieves prefer to use stolen account identifiers to take over existing legitimate investment accounts rather than to set up new unauthorized accounts.


This is one of several trends uncovered in FinCEN’s analysis Identity Theft Trends, Patterns, and Typologies based on suspicious activity reports filed by securities and futures industry firms (SAR-SF). The report examined a sample of the more than 10,000 identity theft SAR-SFs submitted between 2005 and 2010, representing more than a tenth of all SAR-SFs filed during that period.


“The analysis illustrates how through the review of SARs, FinCEN can spot criminal patterns that help an investigation and lead to holding criminal actors accountable for their actions,” said FinCEN Director James H. Freis, Jr. “This report contains information that provides a window into the type of activities identity thieves undertake, of which financial institutions should be aware in order to protect their customers and the financial system from criminal abuse.”


Key findings from the report include the following:

  • Identity thieves most often stole individual and account identifiers through computer intrusion, physical theft, or phishing and vishing scams. Thieves then attempted to use the stolen identifiers to initiate unauthorized transactions within existing accounts or to set up new accounts.
  • During most of the study period, identity thieves reportedly preferred to take over existing legitimate investment accounts rather than to set up new unauthorized accounts using stolen identifiers. This preference appears to relate to the greater level of scrutiny investment firms place on new accounts compared to the level placed on existing accounts.
  • While most SAR-SFs reported the direct theft of funds from existing accounts, there was also a high reported incidence of share price manipulation. For instance, between the fourth quarter of 2006 and the first quarter of 2008, 20-40 percent of quarterly filings reported attempts to manipulate the share values of thinly-traded securities with funds stolen from the investment and/or depository accounts of identity theft victims.
  • Filers frequently reported more than one victim per filing after the same bank account number, phone number, Internet protocol (IP) address, media access control (MAC) address, physical address, and/or email address was used to facilitate theft from multiple victims. Overall, nearly 8 percent of filings reported attacks from the same IP address on accounts of multiple victims.
  • Wire fraud was co-reported with identity theft in nearly 53 percent of the relevant sample filings. Virtually all SAR-SFs co-reporting wire fraud described unauthorized Automated Clearing House (ACH) transfers.
  • Identity thieves used checks to promote financial fraud in nearly 16 percent of sample filings. While the general public’s use of checks is declining, the trend in reports of thieves’ check use increased modestly. Just over 6 percent of filings reported identity thieves used debit cards to steal funds. Debit card usage by identity thieves and dollar loss trends moved strongly up.

As part of the analysis, FinCEN reached out to representatives of the Bank Secrecy Act Advisory Group (BSAAG) Securities and Futures Subcommittee for input regarding the types of information industry would find most useful.


The report is FinCEN’s second covering identity theft. The first report, released in October 2010, focused on a sample of the much larger population of identity theft SAR filings by depository institutions. The average number of subjects named in SAR-SFs was lower than the average number named in SARs filed by depository institutions, likely because most investment transactions, whether legitimate or otherwise, are initiated and completed online, by phone, fax, or mail and rarely involve face-to-face contact with investment industry employees. In contrast, depository institution branch personnel are more likely to experience periodic face-to-face contact with the majority of their branch customers and other individuals intending to complete financial transactions.

9/14/2011 6:53:52 PM
OFAC August 2011

OFAC Enforcement Actions and List Changes


August 2011


 


 


Recent OFAC Actions (Visit OFAC Link)


08/30/2011 Syria Designations


08/26/2011 Routine update of list of Travel and Carrier Service Providers and Remittance Forwarders​​


08/25/2011 Release of Civil Penalties Information - JPMorgan Chase Bank, N.A. Settlement


08/19/2011 Release of quarterly TSRA report​​


08/18/2011 Syria General Licenses Issued


08/18/2011 Syria Executive Order and Identifications


08/16/2011 Release of OFAC Civil Penalties Information​​


08/16/2011 Anti-terrorism Designations


08/11/2011​​ Belarus Designations


08/10/2011 Non-proliferation Designations; Government of Iran Listing Update; Iranian Financial Sanctions Regulations Identifications Update.


08/04/2011 Frequently Asked Questions Regarding Private Relief Efforts in Somalia


08/04/2011​​ Syria Designations


08/03/2011​​ Anti-narcotics Designation Removals


 


 


 


 


OFAC Enforcement Actions


ENTITIES – 31 CFR 501.805(d)(1)(i) Norton Lilly International Assessed a Penalty for Violating the Iranian Transactions Regulations: Norton Lilly International (“Norton&rdquo, Mobile, AL, has been assessed a penalty of $18,750 for its violation of the Iranian Transactions Regulations, 31 C.F.R. part 560, that occurred in November 2006. 


 


CMA CGM (America) LLC Settles Multiple Sanctions Program Allegations: CMA CGM (America) LLC (“CCA&rdquo, Norfolk, VA, has remitted $374,400 to settle allegations of violations of the Cuban Assets Control Regulations, 31 C.F.R. part 515, the Iranian Transactions Regulations, 31 C.F.R. part 560, and the Sudanese Sanctions Regulations, 31 C.F.R. part 538, occurring between approximately December 2004 and April 2008. The base penalty amount for the alleged violations totaled $640,000. The settlement amount reflects OFAC’s consideration of the following General Factors under OFAC’s Economic Sanctions Enforcement Guidelines: the alleged violations appear to have resulted from a pattern of conduct over a period of approximately three years;  given the size and scope of CCA’s operations and the nature of its international business, it appears to have lacked an adequate compliance program to avoid U.S. sanctions violations; some of the goods exported from third countries to Cuba and Iran may have qualified as agricultural/medical products under the Trade Sanctions Reform and Export Enhancement Act of 2000 and, thus, may have been eligible for a license; CCA and CMA CGM have undertaken remediation to ensure that such alleged violations do not recur; CCA had not been the subject of OFAC penalties within the past five years; and CCA cooperated with OFAC throughout the investigation, including by requesting the cooperation of CMA CGM and its foreign affiliates in gathering relevant transaction data, and by agreeing to toll the statute of limitations.


 


Société Générale, New York Settles Allegations of Violations of the Iranian Transactions Regulations: Société Générale New York Branch, New York, NY (“SGNY&rdquo has remitted $111,359 to settle allegations of violations of the Iranian Transactions Regulations, 31 C.F.R. part 560 (the “Regulations&rdquo occurring on or about December 27, 2006, and on or about May 9, 2007. OFAC alleged that SGNY dealt in Iranian-origin services and/or facilitated transactions by a foreign person where the transactions by the foreign person would have been prohibited by the Regulations if performed by a United States person. Specifically, OFAC alleged that SGNY, as the issuing bank of two letters of credit between two non-sanctioned parties, processed two payments under those letters of credit involving the shipment of cargo transported aboard vessels owned and/or managed by the Islamic Republic of Iran Shipping Lines of Tehran, Iran, an Iranian entity. The value of the payments was $329,954. SGNY voluntarily self-disclosed the alleged violations and OFAC has determined that the alleged violations constituted a non-egregious case. The base penalty amount for the alleged violations was $164,977. The settlement amount reflects OFAC’s consideration of the following General Factors under OFAC’s Economic Sanctions Enforcement Guidelines: SGNY improved its compliance program in response to the apparent violations by enhancing its internal controls related to screening trade finance transactions, and provided additional training to staff involved in processing such transactions; SGNY cooperated with OFAC’s investigation and resolution of this matter; and OFAC has not issued a penalty notice or Finding of Violation against SGNY in the five years preceding the transactions at issue.


 


Heritage Turbines, Inc. Settles Sudanese Sanctions Violation Allegation: Heritage Turbines, Inc., Hyannis, MA (“Heritage&rdquo has remitted $4,500 to settle an alleged violation of the Sudanese Sanctions Regulations, 31 C.F.R. part 538, occurring on or about November 21, 2007. OFAC alleged that Heritage attempted to ship two fuel nozzle kits to Sudan without an OFAC license. The fuel nozzle kits were valued at a total of $2,000. OFAC determined that Heritage did not voluntarily self-disclose this matter to OFAC and the alleged violation constituted a non-egregious case. The base penalty amount for the alleged violation totaled $10,000. The settlement amount reflects OFAC’s consideration of the following General Factors under OFAC’s Economic Sanctions Enforcement Guidelines: Heritage had no history of sanctions violations and cooperated with OFAC’s investigation of this matter.


 


JPMorgan Chase Bank N.A. Settles Apparent Violations of Multiple Sanctions Programs: JPMorgan Chase Bank, N.A, New York, NY (“JPMC&rdquo has agreed to remit $88,300,000 to settle potential civil liability for apparent violations of: the Cuban Assets Control Regulations (“CACR&rdquo, 31 C.F.R. part 515; the Weapons of Mass Destruction Proliferators Sanctions Regulations (“WMDPSR&rdquo, 31 C.F.R. part 544; Executive Order 13382, “Blocking Property of Weapons of Mass Destruction Proliferators and Their Supporters;” the Global Terrorism Sanctions Regulations (“GTSR&rdquo, 31 C.F.R. part 594; the Iranian Transactions Regulations (“ITR&rdquo, 31 C.F.R. part 560; the Sudanese Sanctions Regulations (“SSR&rdquo, 31 C.F.R. part 538; the Former Liberian Regime of Charles Taylor Sanctions Regulations (“FLRCTSR&rdquo, 31 C.F.R. part 593; and the Reporting, Procedures, and Penalties Regulations (“RPPR&rdquo, 31 C.F.R. part 501, that occurred between December 15, 2005, and March 1, 2011.

9/14/2011 6:57:44 PM
314a Fact Sheet August 2011

 http://www.fincen.gov/statutes_regs/patriot/pdf/314afactsheet.pdf


Examples of 314(a) requests, based on money laundering, include:


• Hawala operation involving a sanctioned country


• Arms trafficking


• Alien smuggling resulting in fatalities


• Cigarette smuggling


• Nationwide investment fraud with many victims


• International criminal network involved in identity theft and wire fraud


• Multi-agency investigation of drug trafficking rings


Results


To date, the 314(a) Program Office has processed 1,507 requests pertinent to the following significant criminal investigations:


Terrorism/Terrorist Financing – 375 cases


Money Laundering – 1,132 cases


 

9/14/2011 6:59:34 PM
314a Point of Contact Change Info Sept 2011

The following items must be provided to update or add your financial institution’s POC information: financial institution name and charter number or other identifier; point of contact name and title, mailing (street number, P.O. Box, city, state and zip code) and e-mail addresses; and telephone and facsimile numbers.


Please find your institution’s primary federal regulator or self regulatory organization in the below list and forward the above information to them.


Board of Governors of the Federal Reserve System
For Point of Contact Changes or Additions:
e-mail:
patriotact@frb.gov or
fax: (202) 736-5641
Questions: Cheryl Paret, Senior Financial Analyst at (202) 452-3675 or Jennifer White, Senior Financial Analyst at (202) 452-3964


Commodity Futures Trading Commission
Contact information:
E-mail:
AMLstaff@cftc.gov
Fax: (202) 418-5528
Questions: Helene D. Schroeder, Special Counsel, Division of Clearing and Intermediary Oversight at (202) 418-5424


Federal Deposit Insurance Corporation
Contact information:
All changes must be made by the bank through the quarterly Call Report or by filing an amended Call Report
(800) 688-FDIC; (800)688-3342
E-mail:
insurance-research@fdic.gov
Fax: (202) 898-3627
Questions: Anti-Money Laundering Section at (202) 898-6783
E-mail:
fdicadvisory@fdic.gov


Financial Industry Regulatory Authority
Contact information:
For changing POCs or adding a new contact, a FINRA member must update its Anti-Money Laundering Compliance Contacts through the FINRA Contact System at the link below. Each Anti-Money Laundering Compliance Contact (Primary and Alternate) will be added to the FinCEN distribution list.
https://regfiling.finra.org/contacts/ncs_contacts.aspx
Questions: Gateway Call Center at (301) 869-6699


National Credit Union Administration
Contact information:
All changes must be made in the online credit union profile by updating the Primary and Secondary Patriot Act contact on the Contacts Tab. Manual filing federal credit unions should contact their NCUA district examiner to update this information. Manual filing state credit unions should contact their state regulator to have this information updated.


Questions - Federal Credit Unions:
Contact your NCUA district examiner. If you cannot locate your examiner, contact the NCUA regional office that oversees your state. NCUA regional office contact information is posted on the NCUA Website
http://www.ncua.gov/. From the NCUA home page, select Contact Us and scroll to the bottom of the page. Email and telephone contact information is shown for each region. A direct link follows: http://www.ncua.gov/Contact.aspx. If you are unsure which region supervises your state, click on the region's name and a list of supervised states will be shown.


Questions - State Chartered Credit Unions:
Contact your state regulator. Links to the Web sites of many state regulators are included on NCUA's web site,
http://www.ncua.gov/. From the NCUA home page, select Other Resources; then select Financial Regulators. A direct link follows: http://www.ncua.gov/GenInfo/Other/Financial.aspx.


National Futures Association:
Contact Information:
E-mail:
AML@nfa.futures.org
Fax: (312)559-3419
Questions: Valerie Kretschmer, Compliance Department at (312) 781-1290


Office of the Comptroller of the Currency
All changes must be made through the quarterly Call Report or by filing an amended Call Report.
Fax: (202) 874-5301
Additional Information: OCC Alert 2004-6
http://www.occ.gov/static/news-issuances/alerts/2004/alert-2004-6.pdf
Questions: James F. Vivenzio, Senior Counsel for BSA/AML at (202) 874-5200.


Savings Associations supervised by the Federal Deposit Insurance Corporation or Comptroller of the Currency (formerly supervised by the Office of Thrift Supervision)
All FinCEN Point of Contact changes must be made using the EFS (the OTS Electronic Filing Software).
EFS Instructions: "314(a) Contact Updates":
http://www.ots.treas.gov/docs/4/480177.pdf
To e-mail questions about point of contact changes or additions, the OTS mailbox will remain active: Mail to:usap.contact@ots.treas.gov


9/14/2011 7:01:30 PM
Law Enforcement Info Sharing with FI's 9/6/11

See report at the following link: http://www.fincen.gov/statutes_regs/patriot/pdf/leinfosharing.pdf

12/16/2011 8:39:30 PM
CMP $25,000 Bank Employee FinCEN Assesses

FinCEN Assesses Civil Money
Penalty for Suspicious Activity Report Disclosure


Bank Employee Unlawfully Revealed
Existence of SAR to Subject of the Report


VIENNA, Va. - The Financial Crimes Enforcement Network (FinCEN) today
announced the assessment of a $25,000
civil
money penalty
against Frank Mendoza of Garden Grove, California, for violating Bank
Secrecy Act (BSA) prohibitions against disclosing suspicious activity reports
("SARs"). FinCEN determined that Mendoza violated the BSA and its implementing
regulations by willfully disclosing the existence of a SAR to a person involved
in the reported transaction. Mendoza was convicted in a criminal case of bribery
and unlawful SAR disclosure in the U.S. District Court for the Central District
of California.
FinCEN is executing this Assessment
of Civil Money Penalty without the consent of Mendoza.


"FinCEN should and
will exercise its authority to assess a civil money penalty against any person
clearly involved in the unauthorized disclosure of a SAR," said FinCEN Director
James H. Freis, Jr. "Imposition of civil money penalties against persons
willfully disclosing the existence of a SAR defends the environment of trust
between the government and financial institutions, ensures that financial
institution personnel can report activity without fear of reprisal by subjects
identified in reports, and protects the integrity of the information reported on
SARs as well as any future or ongoing investigations."


The evidence
established that Mendoza contacted the subject of a bank SAR, disclosed
existence of the report, and extracted bribes from the subject in return for
Mendoza's promise to assist the subject with any ensuing bank proceedings or
Federal criminal investigation. Today's action resulted from coordination
between FinCEN, the Federal Bureau of Investigation, and the U.S. Attorney's
Office for the Central District of California.


1/17/2012 7:32:42 PM
Secret Service Numbers-Florida Counterfeit Bills

If you need to verify a note here are some numbers for the local field offices in Florida.



FLORIDA

  • FORT MYERS 239-334-0660
  • JACKSONVILLE 904-296-0133
  • MIAMI 305-863-5000
  • ORLANDO 407-648-6333
  • TALLAHASSEE 850-942-9523
  • TAMPA 813-228-2636
  • WEST PALM BEACH 561-659-0184
2/16/2012 6:41:56 PM
OFAC Penalties

 


 


ENFORCEMENT INFORMATION FOR February 7, 2012

 


Teledyne Technologies, Inc. Settles Sudanese Sanctions Regulations Allegations:


 


Teledyne Technologies Incorporated and its subsidiary, Teledyne RD Instruments, Inc. ("Teledyne"), have agreed to pay $30,385 to settle allegations of violations of the Sudanese Sanctions Regulations, 31 C.F.R. part 538, occurring on or about March 9, 2007 and November 30, 2007. OFAC alleged that on two occasions, Teledyne indirectly exported Acoustic Doppler Current Profilers ("ADCP") to Sudan valued at $122,766. The base penalty amount for the alleged violations was $61,383. OFAC determined that Teledyne voluntarily self-disclosed this matter to OFAC and the alleged violations constitute a non-egregious case. The settlement amount reflects OFAC’s consideration of the following facts and circumstances, pursuant to the General Factors under OFAC’s Economic Sanctions Enforcement Guidelines, 31 C.F.R. part 501, App. A: Teledyne has no history of prior OFAC violations; the exports of the ADCPs caused minimal harm to sanctions programs objectives; and Teledyne took appropriate remedial action upon learning of the potential OFAC violations.

2/16/2012 6:45:02 PM
New FinCEN Deputy Director

VIENNA, Va. - The Financial Crimes Enforcement Network (FinCEN) Director James H. Freis, Jr. this week named Peter S. Alvarado as FinCEN's new Deputy Director. Alvarado comes to FinCEN from the Internal Revenue Service Criminal Investigations Division (IRS-CI) where he served for 27 years, most recently as the Deputy Director of Strategy.VIENNA, Va. - The Financial Crimes Enforcement Network (FinCEN) Director James H. Freis, Jr. this week named Peter S. Alvarado as FinCEN's new Deputy Director. Alvarado comes to FinCEN from the Internal Revenue Service Criminal Investigations Division (IRS-CI) where he served for 27 years, most recently as the Deputy Director of Strategy.


"Peter brings with him extensive experience as an investigator, working closely with local, State and Federal law enforcement on a wide range of financial crimes as well as strong leadership in strategic planning, policy management, and international operations," said Director Freis. "I'm extremely pleased to welcome Peter to FinCEN and look forward to the benefits of his continuing commitment to public service."


As Deputy Director, Alvarado is responsible for working with the law enforcement, intelligence, financial, and regulatory communities to ensure the effective coordination of anti-money laundering and anti-terrorist financing initiatives. Alvarado also provides operational leadership and performs the full range of supervisory and managerial functions for FinCEN including planning, coordinating, allocating and assessing tools, capabilities, and resources to best enable FinCEN to continue to efficiently execute its mission.


Alvarado began his career at the IRS-CI as a Special Agent investigating tax fraud, money laundering and currency violations of the Bank Secrecy Act. In 1998, Mr. Alvarado was promoted to Supervisory Special Agent and led a team of agents involved in a variety of investigations relating to corporate fraud, tax shelters, investment schemes, insurance fraud, bankruptcy fraud, embezzlement, and narcotics.


In 2001, Alvarado was appointed as Senior Analyst at IRS-CI's headquarters in Washington, D.C. Assigned to the Financial Crimes Section, he had oversight over programs including those relating to offshore tax evasion. He was subsequently promoted to Assistant Special Agent in Charge of the New York Field Office where, among other responsibilities, he oversaw the investigations of large sophisticated tax shelters. He also directed the activities of a group dedicated to asset forfeiture investigations. Mr. Alvarado was subsequently appointed Special Agent In Charge of the Philadelphia Field Office responsible for planning, directing, and evaluating investigations of public corruption, corporate fraud and investigations relating to counterterrorist financing in the Middle and Eastern Judicial Districts of Pennsylvania.


Mr. Alvarado returned to IRS-CI headquarters as its deputy director providing leadership in Human Resources, Finance, National Criminal Investigation Training Academy, Planning and Strategy, Review and Program Evaluation, and Research. In 2010, Alvarado was appointed Special Agent in Charge of IRS-CI's newly formed Office of International Operations, where he was responsible for the operational and policy management of its overseas workforce.


Alvarado is a graduate of California State University Los Angeles and Whittier Law School. He is a member of the bars of California and Washington, D.C.

2/17/2012 12:34:55 PM
Bashar al-Assad vs. the Syrian People

PolicyWatch #1900PolicyWatch #1900














Bashar al-Assad vs. the Syrian People
By Jeffrey White
February 14, 2012

As the regime continues its latest offensive, the international community should exploit its military weaknesses through actions that help level the battlefield, alter the psychological environment, and increase pressure on Assad and his forces.

What began in March 2011 as an attempt to suppress peaceful antigovernment demonstrations has evolved into a war -- one that Bashar al-Assad is now waging against armed groups and the Syrian people with utter determination and extreme violence. Viewing the conflict as a life-or-death struggle, the regime is escalating its use of military force with near total disregard for the opinions of the outside world. Since late last month, it has used a combination of strategic, operational, and tactical measures to conduct a major offensive against the Free Syrian Army (FSA), the popular opposition, and the areas they control. In doing so, it has revealed its strengths and weaknesses, suggesting areas of focus for any potential international military intervention. Ultimately, without armed intervention, substantial military assistance to the FSA, or both, the best that can be hoped for is a bloody and protracted war of attrition with an uncertain outcome.

Context and Goals of the Offensive


Several factors sparked the regime offensive in late January. Popular opposition, as manifested by ongoing demonstrations, continued throughout the country, with growing unrest in Aleppo and the outskirts of Damascus. Armed resistance was also expanding. The numbers and capabilities of FSA personnel, combat elements, and associated armed groups had increased, as had the frequency and intensity of armed clashes in the Damascus area, Idlib governorate, and Deraa governorate. These factors, along with loss of territory to the opposition, gave the impression of declining regime control of the situation. Assad's forces also faced mounting internal problems:

  • Increasing reports of defections, including soldiers with armored vehicles.

  • Defections from key regime security units, including the 4th Division.

  • Reported loss of fighting spirit among some forces.

  • A decline in operational readiness among both men and equipment, stemming from the high operational tempo the regime had been forced to maintain in response to expanding opposition.

At the same time, some elements of the situation worked to the regime's advantage. Arab League monitors had departed the country, clearing the way for even more aggressive operations. And the international response to the situation remained largely ineffectual, limited to diplomatic and economic measures and excluding the use of force. Assad still had the full backing of Russia and Iran, which provided political and military support while blocking any effective international action.


The resultant offensive seems to have multiple goals. First, the regime likely hopes to reverse the momentum that the opposition gained in December and January. Second, it aims to reduce the threat from the FSA by killing its leaders in Syria, attriting its personnel, and breaking its hold on urban areas. Third, it likely hopes to sever the growing bond between the people and the FSA. Fourth, it seeks to retake territory it has lost to the FSA and the popular opposition. And fifth, it likely feels compelled to reassure Moscow and Tehran that it remains in control of the situation.


Strategy and Operations


Although the regime has a large number of forces -- up to several hundred thousand military and security personnel, depending on how they are counted -- it cannot conduct large-scale multi-brigade/divisional offensives in all areas of unrest simultaneously. In areas where the FSA is embedded, Assad must use significant forces combining armor, infantry, and artillery.


The current offensive has unfolded in phases. The first phase, which began around January 25, involved retaking the Damascus suburbs (Douma, Saqba, Ghouta) and other areas relatively close to the capital that had either passed out of regime control or threatened to do so. Assad employed as many as 20,000 troops in this offensive, including from the "elite" 4th Division and Republican Guard. In the current phase, the regime is working to eliminate important and highly visible centers of resistance, especially in Homs and Zabadani. The next phase will likely focus on reducing armed resistance in Idlib and Deraa governorates, as the regime is able to concentrate forces in those areas.


Tactics


Regime forces are employing tactics that match the goals of the offensive, including isolation, siege, bombardment, and assault. Isolation involves surrounding a targeted area with combat forces and cutting off essential services (water, food, power, and communications) and outside access. The area is then bombarded with heavy weapons. The shelling is intended to inflict casualties (military and civilian), reduce the opposition's will and ability to resist, and set the stage for ground raids and, eventually, direct assault by armor and infantry.


Raids are intended to kill or capture FSA personnel, arrest opposition figures, detain protestors, and weaken opposition. They are frequently executed in areas where the government does not have sufficient forces for a concerted assault. Currently, this tactic is being heavily employed in Idlib, Deraa, and Deir al-Zour governorates.


Assaults are large offensive operations (multi-brigade/divisional scale) aimed at wresting control of an area from the FSA. The regime conducted this kind of action in the Damascus area during the first phase of the offensive, and the stage is set for similar efforts in Homs and Zabadani, where regime forces have been bombarding and raiding.


The regime has yet to employ its full arsenal, however, eschewing certain heavy artillery systems (rockets and missiles), combat aircraft (including attack helicopters), and lethal chemical agents. (Recent reports of nerve agent use in Homs are unconfirmed.) Most likely, Assad is concerned about international reaction to the use of aircraft (bearing in mind what happened in Libya) and lethal chemical weapons against unprotected civilians. The regime has these weapons in abundance and could choose to employ them if it becomes desperate enough. Indeed, if the current offensive fails to achieve its objectives and resistance continues to grow, the regime will likely commit heavy artillery and combat aviation to the struggle. And the use of lethal chemical weapons cannot be ruled out.


Balance Sheet


In terms of meeting its goals, the regime has had limited success during the current offensive. FSA combat formations have taken some losses among both leaders and personnel. Meanwhile, regime forces have at least temporarily suppressed armed opposition in some areas and reasserted control in others (e.g., parts of Homs and the close-in Damascus suburbs).


Yet these gains have been made at significant cost in terms of casualties and damage, and without demonstrating that the regime can clear and hold areas for longer than the time troops are sitting on top of them. Moreover, the army is showing signs of strain. The increased use of field artillery suggests that it is concerned about fighting the FSA up close in difficult urban environments. It also seems worried about the FSA's antitank capabilities. In addition, ground forces have shown evidence of declining combat spirit, with reports of infantry units unwilling to advance or retreating from contact unless accompanied by armor.


Implications


As mentioned above, the war has become a matter of survival for the Assad regime. It is approaching the upper limit of violence it can employ, and if it is not yet "all in," it may soon be so, with potentially devastating effects on the population.


The keys to continued regime military operations are clear: the ability to mount coordinated operations on a large scale, the ability to move forces at will, and the ability to employ heavy firepower. At the same time, regime forces have real weaknesses in close urban combat, in their inability to destroy FSA elements, and in their need to fight in many locations simultaneously.


These factors suggest several ways of providing military assistance to the FSA if direct military intervention is not an option. For example, the United States and other international actors could give the FSA the means to disrupt the regime's military communications system, such as targeting information or the physical means of cutting communication lines. They could also provide techniques and weapons (e.g., mines and other explosive devices) for disrupting road movement. To deal with regime armor and artillery, they could provide antitank weapons and mortars. And additional small arms and ammunition would help offset the regime's advantage in numbers. This is by no means an exhaustive list, but these kinds of actions would help level the battlefield, alter the psychological environment, and increase pressure on Assad and his forces. Ultimately, they could also save lives by inhibiting regime operations and, perhaps, shortening the conflict.


Jeffrey White is a defense fellow at The Washington Institute, specializing in the military and security affairs of the Levant and Iran.

2/17/2012 12:53:14 PM
•FinCEN Launches New MSB website

January 27, 2012


FinCEN Launches New Money Services Business (MSB) Registration Web site


As announced in December, FinCEN today launched a new MSB Registration Web site to improve the availability of MSB registration information. The MSB Registration Web site replaces the MSB Registration List. As part of the Department of Treasury's initiative to go paperless, FinCEN will also no longer send acknowledgement letters to MSBs. The new Web site will provide MSBs, banks, regulators, law enforcement, and the general public the ability to access, search, download and print MSB registration information 24 hours a day, seven days a week. The Web site will contain similar information that the MSB Registration List previously contained, such as the name of the registrant, states where the registrant engages in MSB activities, and the types of MSB activities provided. The new Web site will also include the MSB Registration Number.


FinCEN will update the MSB Registration Web site weekly. MSBs will be added to the Web site within approximately two weeks of electronically filing their Registration of Money Services Businesses (RMSB) (Form 107). A paper version of the RMSB will require approximately 60 days for processing and posting to the MSB Registration Web site. Accordingly, MSBs are encouraged to electronically file the RMSB.

2/17/2012 12:59:15 PM
Hizballah Poised to Strike in Southeast Asia








Hizballah Poised to Strike in Southeast Asia
By Matthew Levitt
January 18, 2012

New discoveries regarding Hizballah bombmaking in Thailand are no surprise given the group's long history of terrorist operations in Southeast Asia.

Last week, Thai police arrested Atris Hussein, a suspected Hizballah operative, at the Bangkok airport, while another suspect escaped. Elsewhere in the capital, authorities seized a large cache of chemical explosives composed of ammonium nitrate and urea fertilizer, leading the United States and Israel to issue emergency alerts warning their citizens in the country of a possible imminent terrorist attack. According to local authorities, initial intelligence indicated an attack would occur over the weekend in Thailand, yet they now believe some or all of the explosives were intended to be shipped out of the country. The U.S. embassy in Bangkok, meanwhile, continues to warn U.S. citizens of a "real and credible" threat of a terrorist attack in the capital.

Although the news may read like a made-for-Hollywood plotline, the fact that Hizballah is active in Southeast Asia should come as no surprise. Indeed, the case strongly parallels several previous Hizballah plots in Thailand and elsewhere in the region. Hussein is not the first Hizballah operative to be arrested at a Southeast Asian airport, nor is he the first to be tied to weapons caches and terrorist operations in Thailand. Hizballah operations in the country date back to at least April 1988, when group members hijacked a Kuwaiti airliner departing from Bangkok. And the discovery of chemical explosives is reminiscent of the group's use of a bomb built with the same chemicals in a 1994 plot targeting the Israeli embassy in Bangkok.


April 1988: Hijacking Flight 422


On April 5, 1988, Hizballah members seized Kuwait Airways Flight 422, which was carrying 112 passengers from Bangkok to Kuwait. Forcing the plane to land in Mashhad, Iran, the hijackers sought the release of seventeen imprisoned Shiite terrorists, including Iraqi al-Dawa and Lebanese Hizballah operatives jailed for their roles in the near-simultaneous December 1983 bombings of the American and French embassies and several other sites in Kuwait. Over the course of the fifteen-day hijacking, Hizballah gunmen killed two passengers before ultimately releasing the rest.


Assessing whether Hizballah could have been behind the 1990 assassination of three Saudi diplomats in Bangkok, the CIA noted that the hijacking of Flight 422 underscored Hizballah's ability to operate there. "It is possible," an agency assessment read, "that the Islamic Jihad Organization (IJO), a Hizballah element headed by Imad Mughniyah, carried out these assassinations. Mughniyah has close ties to Tehran, and the IJO demonstrated its operational capability in Thailand by orchestrating the hijacking of flight KU422 from Bangkok in 1988."


March 1994: Targeting the Israeli Embassy


On March 11, 1994, a Hizballah suicide bomber came within about 240 meters of driving a van laden with explosives into the Israeli embassy in Bangkok. As he exited an underground parking garage, however, he crashed into a motorcycle taxi, panicked, and fled the scene. When police inspected the van, they found a water tank filled with approximately 1,000 kilograms of fertilizer, two oil containers, a battery, C4 explosives, and two manual switches beneath the driver's seat, wired to set off the massive bomb.


Upon removing the explosives from the water tank, police also discovered a dead body. The owner of the van recognized the murdered man as one of her drivers and confessed that she had agreed to rent the vehicle to a person who preferred not to provide the required documentation so long as one of her employees drove. The unfortunate employee had been strangled and stuffed into the explosive-filled drum; had the bomb gone off as planned, no evidence of his death would have survived the blast. Four months later, a Hizballah suicide operative drove a similar truck bomb into the AMIA Jewish community center in Buenos Aires. Yet the group's involvement in the Bangkok embassy plot was not discovered until five years later.


November 1999: Hizballah Operative Arrested at the Airport


When Pandu Yudhawinata stepped off Philippines Airlines Flight 126 from Zamboanga City to Manila in November 1999, customs officials with drug-sniffing dogs honed in on his luggage and arrested him for narcotics possession. In fact, the Indonesian suspect was already well known to counterterrorism officials. Within weeks of his arrest, the Philippines Intelligence Directorate informed the chief of national police that Pandu was the subject of a "covert operation" by the directorate and its "Israeli counterparts." Israeli counterterrorism officials confirmed that a joint operation had led to a number of cell members across Thailand who, when brought in for questioning in October 1999, provided key information that uncovered previously unknown details about Pandu, his terrorist network, and Hizballah's role in the failed 1994 plot to bomb the Israeli embassy in Bangkok.


Pandu, investigators discovered, was the one who rented the van for that plot under a false identity, coordinated with senior Hizballah commanders in Lebanon, and oversaw the network's passport and other procurement efforts in the region. Moreover, according to an Israeli intelligence report, the interrogation of the Thai cell members revealed that Hizballah was planning other attacks targeting Israeli and U.S. interests in both Southeast Asia and Europe.


A full inspection of Pandu's checked luggage also revealed documents with the names and telephone numbers of various Hizballah and Iranian intelligence operatives, as well as five Philippine passports in the names of different people, a photocopy of a sixth passport, and personal data for five more persons. Eventually, investigators found that one of Pandu's areas of specialization was procuring false passports for Hizballah operatives, and he had traveled to the Philippines at least twice in the weeks leading up to his arrest for this express purpose. The urgency of these visits was operational: according to local authorities, the passports were intended to be used by Hizballah "for an impending terrorist attack at [a] still undetermined country in the Middle East." Shortly after making that discovery, they found that Pandu also maintained Hizballah arms caches in both Bangkok and Manila


Hizballah in Southeast Asia


In between trips to Iran and Lebanon for additional training, Pandu spent the bulk of his time from the botched 1994 bombing until his 1999 arrest carrying out smaller missions for Hizballah. According to Philippine investigators, these missions involved "procurement of armaments in Indonesia and passports in other parts of Southeast Asia and the conduct of casings on terrorist targets and recruitment of members." Although he was living in Malaysia at the time, Pandu was also involved in storing weapons in both Thailand and the Philippines, "presumably in preparation for future missions," Philippine authorities concluded.


In 1996, Hizballah sent one of the operatives involved in the 1994 Bangkok bomb plot back to Thailand and other countries in the region in order to prepare "the Five Contingency Attacks." This opaque phrasing -- perhaps describing attacks to be executed only under some specific contingency -- fits an established Hizballah modus operandi of casing targets and preparing off-the-shelf operations that are ready to go if and when an order is given to act.


Indeed, intelligence reports indicate that Hizballah operatives were active in the region throughout the 1990s, including Thailand, the Philippines, Singapore, Malaysia, Australia, and even Burma. According to Philippine authorities, the group's potential targets included U.S. and Israeli embassies, Israeli companies, synagogues, Jewish communities, tourist sites frequented by Americans and Israelis, offices of Israel's El-Al Airlines, and American and Israeli military and merchant vessels traveling through the Singapore Strait and the Strait of Malacca.


Hizballah activity in the region continued into the new millennium, though mirroring the group's post-September 11 trend of focusing more on logistics than operations in order to stay out of the crosshairs of the global war on terrorism. Even during this period, Hizballah engaged in some operational activity, especially infiltrations into Israel by operatives from Europe and, in one case, Southeast Asia. And the operational hiatus ended in full with the February 2008 assassination of Mughniyah, who had continued to serve as the group's external operations commander.


Therefore, it should come as no surprise today that Hizballah has the capacity to carry out attacks and engage in logistical support activities in Thailand and elsewhere in the region. Should the need arise, the group is ready to either set contingency operations in motion or procure and move explosives or other materials. With the anniversary of Mughniyah's assassination just weeks away, U.S. and Israeli authorities are on high alert for the kinds of plots reportedly foiled in places as far afield as Thailand, Bulgaria, and Turkey. Hizballah first demonstrated its ability to operate in Thailand more than two decades ago and has maintained it ever since. What remains to be seen is whether last week's arrest, like Pandu's in 1999, will help authorities uncover the local Hizballah cell that Atris Hussein and his escaped accomplice were almost certainly overseeing.


Matthew Levitt is director of The Washington Institute's Stein Program on Counterterrorism and Intelligence. This article draws on research conducted for his forthcoming book Hezbollah: The Global Footprint of Lebanon's "Party of God" (Georgetown University Press).

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