Bill Overview
Title: FinCEN Modernization Act of 2022
Description: This bill requires the Financial Crimes Enforcement Network (FinCEN) to establish programs and perform research related to financial technology, including topics such as machine learning, data analytics, and cryptocurrency. The bill allows FinCEN to enter into transactions and to accept gifts related to these objectives.
Sponsors: Rep. Donalds, Byron [R-FL-19]
Target Audience
Population: Individuals involved with or using financial technology services globally
Estimated Size: 20000000
- Financial institutions that rely on compliance with anti-money laundering (AML) and financial regulations will be directly impacted by changes from FinCEN.
- Companies and individuals involved in the financial technology sector, especially those using machine learning, data analytics, and cryptocurrency, may see changes or opportunities as a result of FinCEN's modernized capabilities.
- Consumers who use financial technology services could experience impacts indirectly through changes in security, privacy, or user experience as regulations evolve.
Reasoning
- The FinCEN Modernization Act primarily affects financial institutions, fintech companies, and consumers engaged in financial technology services. A notable portion of the U.S. population interacts directly or indirectly with these services, making them potential secondary beneficiaries of improved security and innovation initiated by the policy.
- Given that fintech companies and financial institutions are central to the policy, it makes sense to include representatives from these sectors in the interviews to assess potential economic and operational impacts. The average consumer, while less directly affected, could see changes in service quality and security, impacting their self-reported wellbeing.
- The simulated interviews aim to capture a diverse set of perspectives, including those who stand to gain directly from the policy, such as fintech workers and compliance officers, as well as typical consumers whose privacy and user experiences may improve. Because the policy's budget has limitations, the interviews explore both immediate and long-term changes in wellbeing.
Simulated Interviews
Compliance Officer at a large bank (New York, NY)
Age: 32 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 20.0 years
Commonness: 5/20
Statement of Opinion:
- The modernization could streamline many compliance tasks, making my job easier.
- There's potential for improved accuracy in detecting suspicious activity.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 6 |
| Year 2 | 7 | 6 |
| Year 3 | 7 | 6 |
| Year 5 | 8 | 6 |
| Year 10 | 9 | 6 |
| Year 20 | 9 | 6 |
Software Engineer at a fintech startup (San Francisco, CA)
Age: 28 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 10.0 years
Commonness: 4/20
Statement of Opinion:
- The act could open up funding opportunities for research and development.
- I'm excited about the potential for collaboration with FinCEN.
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 | 9 | 7 |
| Year 10 | 9 | 7 |
| Year 20 | 8 | 6 |
Cryptocurrency Trader (Chicago, IL)
Age: 45 | Gender: other
Wellbeing Before Policy: 5
Duration of Impact: 5.0 years
Commonness: 3/20
Statement of Opinion:
- Regulation can be a double-edged sword: necessary but potentially restrictive.
- Better data tools would definitely help manage risk better.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 5 |
| Year 2 | 6 | 5 |
| Year 3 | 7 | 5 |
| Year 5 | 7 | 5 |
| Year 10 | 7 | 5 |
| Year 20 | 6 | 4 |
Financial Advisor (Dallas, TX)
Age: 55 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 10.0 years
Commonness: 3/20
Statement of Opinion:
- This could reassure clients about the safety and legitimacy of crypto investments.
- Modernization might simplify some of the reporting work.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 6 | 6 |
| Year 3 | 7 | 6 |
| Year 5 | 7 | 6 |
| Year 10 | 7 | 6 |
| Year 20 | 6 | 6 |
General Public User of Fintech Apps (Seattle, WA)
Age: 38 | Gender: female
Wellbeing Before Policy: 8
Duration of Impact: 20.0 years
Commonness: 10/20
Statement of Opinion:
- If security improves, I'll feel even more confident using these apps.
- I hope this doesn't lead to more cumbersome regulations for simple users like me.
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 | 9 | 8 |
| Year 10 | 9 | 8 |
| Year 20 | 9 | 8 |
Retired (Phoenix, AZ)
Age: 60 | Gender: male
Wellbeing Before Policy: 7
Duration of Impact: 5.0 years
Commonness: 6/20
Statement of Opinion:
- I'm worried about scams; more security would help protect my retirement savings.
- I hope costs don't increase as a result of new 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 | 7 | 7 |
Data Analyst at a tech firm (Boston, MA)
Age: 30 | Gender: other
Wellbeing Before Policy: 6
Duration of Impact: 10.0 years
Commonness: 4/20
Statement of Opinion:
- The policy might increase demand for data-driven solutions, which could boost my career.
- There's potential for innovative projects that could emerge from this modernization.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 6 |
| Year 2 | 8 | 6 |
| Year 3 | 8 | 6 |
| Year 5 | 9 | 6 |
| Year 10 | 9 | 6 |
| Year 20 | 8 | 5 |
Customer Support Specialist at a fintech company (Miami, FL)
Age: 27 | Gender: female
Wellbeing Before Policy: 5
Duration of Impact: 5.0 years
Commonness: 5/20
Statement of Opinion:
- This could mean we need less time resolving security concerns.
- I'd like to see more trust from customers due to improved security measures.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 5 |
| Year 2 | 6 | 5 |
| Year 3 | 7 | 5 |
| Year 5 | 7 | 5 |
| Year 10 | 7 | 5 |
| Year 20 | 6 | 4 |
Small Business Owner (Austin, TX)
Age: 40 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 5.0 years
Commonness: 7/20
Statement of Opinion:
- Enhanced financial tech may streamline my payment processes.
- I hope it addresses privacy concerns from clients about digital pay systems.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 6 | 6 |
| Year 3 | 7 | 6 |
| Year 5 | 7 | 6 |
| Year 10 | 7 | 6 |
| Year 20 | 6 | 6 |
App Developer for Fintech (Los Angeles, CA)
Age: 33 | Gender: male
Wellbeing Before Policy: 7
Duration of Impact: 20.0 years
Commonness: 3/20
Statement of Opinion:
- Access to machine learning resources would expand our app capabilities.
- I'm hopeful about the opportunities for partnership with FinCEN.
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 | 9 | 7 |
| Year 10 | 9 | 7 |
| Year 20 | 8 | 7 |
Cost Estimates
Year 1: $15000000 (Low: $12000000, High: $20000000)
Year 2: $12000000 (Low: $10000000, High: $15000000)
Year 3: $10000000 (Low: $8000000, High: $14000000)
Year 5: $9000000 (Low: $7000000, High: $12000000)
Year 10: $8000000 (Low: $6000000, High: $10000000)
Year 100: $5000000 (Low: $3500000, High: $8000000)
Key Considerations
- Ensuring that the technological advancements align with existing legal frameworks to avoid regulatory challenges.
- Potential pushback from financial institutions needing to adjust to new compliance protocols.
- Monitoring and adapting to rapidly changing technology trends is crucial for maintaining relevance.