Bill Overview
Title: Financial Crimes Enforcement Network Improvements Act
Description: This bill makes several organizational changes to the Financial Crimes Enforcement Network (FinCEN). First, the director of FinCEN must be appointed by the President with the advice and consent of the Senate. (Currently, the director is appointed by the Secretary of the Treasury.) The bill also establishes an Office of Audit and Investigations within FinCEN. The office must prioritize audits and investigations that protect the civil liberties and privacy of citizens. The bill also provides for a Civil Liberties Protection Officer to oversee compliance with all guidelines relating to civil liberties and privacy. Further, the bill imposes additional requirements on the rulemaking process for FinCEN, including by limiting the delegation authorities of the Secretary of the Treasury to make findings and exercise authority to certify, delay, or waive certain rulemaking activities. FinCEN is also required to conduct additional outreach to small businesses prior to a rulemaking. Finally, FinCEN must disclose certain controlling documents regarding the implementation of specified laws and must report to Congress any unlawful FinCEN activity and corrective action taken.
Sponsors: Rep. Davidson, Warren [R-OH-8]
Target Audience
Population: People interacting with financial systems regulated by FinCEN
Estimated Size: 30000000
- The bill impacts the Financial Crimes Enforcement Network (FinCEN), an agency within the U.S. Department of the Treasury.
- FinCEN's activities influence various financial institutions globally through the enforcement of anti-money laundering (AML) laws.
- The changes to civil liberties protection will have implications for U.S. citizens subject to financial investigations.
- The bill directly affects the governance of FinCEN and its rulemaking processes, impacting how financial regulations are applied within the U.S. financial system.
- The requirement for FinCEN to conduct outreach to small businesses suggests a focus on improving the interaction between small financial institutions and regulatory bodies in the U.S.
Reasoning
- The policy primarily focuses on organizational changes within FinCEN, aiming to enhance oversight and civil liberties protections. Thus, the direct impact on individual citizens may be indirect or modest, depending on their involvement with financial systems under scrutiny by FinCEN.
- The primary targeted group includes individuals and businesses whose financial activities are monitored under FinCEN's jurisdiction, primarily concerning anti-money laundering activities.
- Given that the policy aims at increased transparency and privacy through audits, small business owners, people involved in financial services, and citizens concerned with privacy might perceive benefits or downsides depending on their perspective.
- Although the scope of impact is broad in terms of FinCEN's reach, the immediate impacts will materialize more significantly for those directly engaging with the financial system under FinCEN's purview.
- With a budget constraint, the policy impacts may not be drastic but gradual, improving transparency and governance over the years.
- Because of the global reach of FinCEN, even though the direct action occurs in the U.S., there could be international reactions due to perceived rule changes impacting international financial relations.
Simulated Interviews
Small Business Owner (New York, NY)
Age: 30 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 10.0 years
Commonness: 5/20
Statement of Opinion:
- I'm hopeful that FinCEN's increased outreach to small businesses will make compliance easier for us.
- Privacy is very important to me, so having a Civil Liberties Protection Officer sounds reassuring.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 7 | 6 |
| Year 3 | 7 | 6 |
| Year 5 | 7 | 5 |
| Year 10 | 8 | 5 |
| Year 20 | 8 | 5 |
Financial Analyst (San Francisco, CA)
Age: 42 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 5.0 years
Commonness: 3/20
Statement of Opinion:
- The new rulemaking balance might mean more stringent compliance but could improve transparency, which is welcome.
- There's always pressure from compliance, so more structured guidelines are beneficial.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 7 | 6 |
| Year 3 | 7 | 6 |
| Year 5 | 7 | 6 |
| Year 10 | 7 | 6 |
| Year 20 | 7 | 6 |
Retired (Miami, FL)
Age: 54 | Gender: male
Wellbeing Before Policy: 5
Duration of Impact: 3.0 years
Commonness: 4/20
Statement of Opinion:
- I'm pleased about the emphasis on civil liberties, but skeptical of how effective it will be.
- Retiring from financial compliance, I know the bureaucracy; more oversight could be good.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 5 |
| Year 2 | 5 | 5 |
| Year 3 | 6 | 5 |
| Year 5 | 6 | 5 |
| Year 10 | 6 | 5 |
| Year 20 | 6 | 5 |
Software Engineer (Chicago, IL)
Age: 28 | Gender: female
Wellbeing Before Policy: 8
Duration of Impact: 5.0 years
Commonness: 6/20
Statement of Opinion:
- The bill decides the fate of how flexible fintech interactions with banks will be.
- Data privacy safeguards within government agencies are critical.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 8 |
| Year 2 | 8 | 7 |
| Year 3 | 8 | 7 |
| Year 5 | 8 | 7 |
| Year 10 | 8 | 7 |
| Year 20 | 8 | 7 |
Retired Teacher (Houston, TX)
Age: 65 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 0.0 years
Commonness: 8/20
Statement of Opinion:
- I don't quite understand the full details, but anything protecting my savings is good.
- I am concerned with government overreach, so civil liberty measures are assuring.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 6 | 6 |
| Year 3 | 6 | 6 |
| Year 5 | 6 | 6 |
| Year 10 | 6 | 6 |
| Year 20 | 6 | 6 |
Bank Compliance Officer (Atlanta, GA)
Age: 38 | Gender: male
Wellbeing Before Policy: 5
Duration of Impact: 10.0 years
Commonness: 3/20
Statement of Opinion:
- The policy pushes for more accountability, which may ease compliance burdens.
- Outreach to smaller institutions will benefit regional banks like ours.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 5 |
| Year 2 | 6 | 5 |
| Year 3 | 6 | 5 |
| Year 5 | 7 | 5 |
| Year 10 | 7 | 5 |
| Year 20 | 7 | 5 |
Privacy Advocate (Seattle, WA)
Age: 45 | Gender: other
Wellbeing Before Policy: 4
Duration of Impact: 15.0 years
Commonness: 2/20
Statement of Opinion:
- I see this policy as a win for oversight and privacy if executed properly.
- Vigilance is necessary. I hope new guidelines are firmly implemented.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 4 |
| Year 2 | 6 | 4 |
| Year 3 | 7 | 3 |
| Year 5 | 7 | 3 |
| Year 10 | 8 | 3 |
| Year 20 | 9 | 3 |
Tech Entrepreneur (Los Angeles, CA)
Age: 33 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 7.0 years
Commonness: 4/20
Statement of Opinion:
- Innovation in financial regulations is vital and should adapt to new technologies like blockchain.
- Focus on small businesses is critical to future-proofing regulations.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 8 | 7 |
| Year 3 | 8 | 7 |
| Year 5 | 8 | 7 |
| Year 10 | 8 | 7 |
| Year 20 | 8 | 7 |
Accountant (Boston, MA)
Age: 50 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 5.0 years
Commonness: 7/20
Statement of Opinion:
- Ensuring databases are well audited enhances trust in financial systems.
- Clients value privacy so I'm optimistic about the changes.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 6 | 6 |
| Year 3 | 6 | 6 |
| Year 5 | 6 | 5 |
| Year 10 | 6 | 5 |
| Year 20 | 6 | 5 |
College Student (Phoenix, AZ)
Age: 22 | Gender: female
Wellbeing Before Policy: 8
Duration of Impact: 0.0 years
Commonness: 10/20
Statement of Opinion:
- I'm not very familiar with FinCEN, but privacy is extremely important to me.
- The more oversight, the better, if it protects my data.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 8 |
| Year 2 | 8 | 8 |
| Year 3 | 8 | 8 |
| Year 5 | 8 | 8 |
| Year 10 | 8 | 8 |
| Year 20 | 8 | 8 |
Cost Estimates
Year 1: $30000000 (Low: $25000000, High: $35000000)
Year 2: $32000000 (Low: $27000000, High: $37000000)
Year 3: $34000000 (Low: $29000000, High: $39000000)
Year 5: $36000000 (Low: $31000000, High: $41000000)
Year 10: $40000000 (Low: $35000000, High: $45000000)
Year 100: $50000000 (Low: $45000000, High: $55000000)
Key Considerations
- The impact on small businesses due to additional FinCEN outreach requirements.
- Potential benefits of improved financial system integrity due to enhanced audits and oversight.
- Long-term costs associated with maintaining robust compliance and civil liberties protection measures.