http://fincen.gov/news_room/nr/html/20141002.html

Most of the businesses in the Los Angeles Fashion District should be scrambling to get registered as e-filers of FinCEN Form 8300 between now and next Thursday. They've just be hit with a 180-day Geographic Targeting Order that goes into effect on October 9. And the reporting threshold is dropped to $3,000.

I wonder how many of the targeted businesses have EVER SEEN a form 8300, let alone filled one out!

Before you panic, financial institutions aren't subject to the order. But LA banks are likely to have customers who are included on the list.

We do.

I wonder how this will be enforced. How will the businesses be notified of the order? A large number of business people there do not speak English.

Has anyone ever seen an order like this before?

There's this:
http://www.law.cornell.edu/uscode/text/31/5326

Section (a) describes the authorization of the actual order. Section (b) provides for the deputization of FIs to request and collect copies of the reports from the subject parties.

Now, nothing in the announcement from FinCEN presently directs the banks to collect their customers' reports, but the authority exists should FinCEN choose to go that route.

I sincerely hope that FinCEN doesn't consider that option. But it does have a bear of a communications challenge here. Trade groups and industry newsletters, I imagine. And the local newspapers will pick up the news release and run with it. They might even translate it into locally-spoken languages.

Many of these businesses were already hit in the September 10 sweep that pulled $90 million in cash off the streets. They will pay attention.

And the drug cartels will find another unlucky group to wash their cash through.

FinCEN has one other GTO affecting the border crossings in San Diego County.

Exciting times in SoCal.

Brings to mind other big cases in the LA area within the last few years:

http://www.ice.gov/news/releases/1305/130506losangeles.htm
http://latimesblogs.latimes.com/lanow/2012/01/toy-company-1.html

I wonder how many other active money laundering investigations are going around right outside of the fashion district. They should have a close look at the frozen foods businesses not far from the fashion district.

http://www.latimes.com/local/la-me-fashion-district-cartels-20141003-story.html

I'm not sure if this link will work. You may have to be a subscriber.


"The orders take effect Oct. 9 and last for 180 days. Most of the orders were sent via express mail, but about 60 were hand-delivered Thursday morning by federal agents. Authorities said the stores received in-person visits for a reason, but would not elaborate."

There is that little matter of the September raids and I'm guessing there might be correlation between the list of the establishments visited then and the list of those "served" with the order in person now. You can imagine that several of the businesses are already in the crosshairs of law enforcement, which will be ready to swoop in and make arrests if they learn of reportable transactions that don't get memorialized in a Form 8300 report.

There was a GTO issued for a specific area and industry here in South Florida a couple days ago. I'm just curious what the experiences were for some of the banks affected by the Cali GTO? What was expected of the banks and what was extra measures were taken by your respective institutions? If anyone would care to share some info with me I would greatly appreciate it.

I don't think that banks in the targeted Miami area need to do anything different. It's a targeted order aimed at exporters of electronics, as I recall. We included a link to the order in our Top Stories articles on April 22. Here's the link again: http://www.fincen.gov/news_room/nr/pdf/GTO_Miami.pdf

An extra measure I took for the CA GTO was to check if I had commercial customers in that targeted area and if my customers fell within the definition of a covered business. Upon locating them, I'd review their activities to look for signs of TBML, especially keeping an eye out for wire/trade activity with Central and South America. But as John pointed out, the GTO is aimed at the businesses, not the banks.

Thank you both so much for your responses. I know the GTO is customer driven, but I can only imagine an examiner coming in and asking if we have done anything with regards to the GTO and I somehow don't think answering "it's the customers issue not ours" wont really fly LOL. So I had already done what MT2002 suggested but was wondering if any other banks had any other actions they took or if they had any other experiences with the GTO. Like maybe following up with your customers that fit in the categories to remind them of their obligation to complete the 8300's etc.