Bill Overview
Title: Special Measures to Fight Modern Threats Act
Description: This bill expands the special measures available to the Financial Crimes Enforcement Network (FinCEN) to combat money laundering regarding a jurisdiction outside of the United States; a financial institution operating outside of the United States; a class of transaction within, or involving, a jurisdiction outside of the United States; or one or more types of accounts. Specifically, FinCEN may prohibit or impose conditions upon the opening or maintaining in the United States of a correspondent account or payable-through account by any domestic financial institution or domestic financial agency without requiring, as under current law, that such account be for or on behalf of a foreign banking institution. Further, FinCEN may prohibit or impose conditions upon certain transmittals of funds to or from any domestic financial institution or domestic financial agency if such transmittal of funds involves any such jurisdiction, institution, class of transaction, or type of account.
Sponsors: Sen. Warner, Mark R. [D-VA]
Target Audience
Population: People involved in international financial transactions and foreign financial institutions
Estimated Size: 10000000
- The bill primarily affects financial institutions and transactions involving jurisdictions outside of the U.S.
- It potentially impacts foreign financial institutions and their ability to operate accounts in the U.S.
- It affects individuals and businesses engaged in international financial transactions that involve jurisdictions outside of the U.S.
- It may alter the operation of domestic financial institutions regarding international transactions.
- By targeting money laundering, it can indirectly affect individuals involved in or benefiting from such activities.
Reasoning
- The policy primarily impacts financial institutions and individuals involved in international financial transactions. Hence, the interviews will focus on both domestic financial employees, international businessmen, and average citizens who transfer money internationally.
- Financial institutions, especially those dealing with international transactions, will potentially face higher regulatory scrutiny, affecting operations and thus staffing or service fees.
- Small businesses that export goods or services might be affected by increased transaction conditions or restrictions, potentially affecting their operations and financial health.
- Some individuals might experience changes in how they send and receive money internationally if they engage in transactions with jurisdictions that are more tightly controlled under this policy.
- The overall population directly affected is relatively small compared to the entire U.S. population, but the ripple effects can broaden the impact slightly.
- The policy's financial constraints suggest prioritization of the most significant threats; thus, common banks and usual international transactions may experience minimal immediate impact unless linked to high-risk jurisdictions.
Simulated Interviews
International Banking Executive (New York, NY)
Age: 42 | Gender: male
Wellbeing Before Policy: 8
Duration of Impact: 10.0 years
Commonness: 5/20
Statement of Opinion:
- The policy increases scrutiny on our international transactions, which could complicate certain operational processes.
- Over the long term, it might benefit us by reducing bad actor activities which can create expensive regulatory issues.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 8 |
| Year 2 | 7 | 8 |
| Year 3 | 8 | 8 |
| Year 5 | 8 | 8 |
| Year 10 | 9 | 8 |
| Year 20 | 9 | 8 |
Small Business Owner (San Francisco, CA)
Age: 35 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 5.0 years
Commonness: 7/20
Statement of Opinion:
- This policy could delay or complicate some of our transactions with foreign partners.
- Increased fees due to compliance costs might hurt my profit margins initially.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 6 |
| Year 2 | 6 | 6 |
| Year 3 | 6 | 6 |
| Year 5 | 7 | 6 |
| Year 10 | 7 | 6 |
| Year 20 | 7 | 6 |
Cryptocurrency Trader (Miami, FL)
Age: 29 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 8.0 years
Commonness: 4/20
Statement of Opinion:
- Regulations might extend to crypto transactions too, making trading more cumbersome.
- Could reduce illegal activity in the crypto space, indirectly benefiting legitimate traders like myself.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 7 |
| Year 2 | 7 | 7 |
| Year 3 | 7 | 7 |
| Year 5 | 8 | 7 |
| Year 10 | 8 | 7 |
| Year 20 | 8 | 7 |
Retired (Chicago, IL)
Age: 60 | Gender: male
Wellbeing Before Policy: 5
Duration of Impact: 2.0 years
Commonness: 6/20
Statement of Opinion:
- With stricter measures, sending money to my family might become more restricted or expensive.
- I worry about potential delays in transfers.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 4 | 5 |
| Year 2 | 5 | 5 |
| Year 3 | 5 | 5 |
| Year 5 | 5 | 5 |
| Year 10 | 5 | 5 |
| Year 20 | 5 | 5 |
Software Engineer (Houston, TX)
Age: 27 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 3.0 years
Commonness: 8/20
Statement of Opinion:
- I don’t perceive a direct impact on my current financial situation.
- I am concerned about potential implications if my relative faces restrictions.
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 |
Financial Analyst (Seattle, WA)
Age: 50 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 8.0 years
Commonness: 5/20
Statement of Opinion:
- This policy might increase the demand for compliance experts, benefiting my career.
- Companies might struggle at first adapting to more stringent regulations.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 6 |
| Year 2 | 7 | 6 |
| Year 3 | 8 | 6 |
| Year 5 | 8 | 6 |
| Year 10 | 8 | 6 |
| Year 20 | 8 | 6 |
University Professor (Boston, MA)
Age: 58 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 10.0 years
Commonness: 6/20
Statement of Opinion:
- The bill could add to the complexity of financial systems internationally, making it a rich topic for study.
- It may foster in-depth discussions and research opportunities at the university.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 7 | 7 |
| Year 3 | 7 | 7 |
| Year 5 | 8 | 7 |
| Year 10 | 8 | 7 |
| Year 20 | 8 | 7 |
Freelancer (Los Angeles, CA)
Age: 24 | Gender: male
Wellbeing Before Policy: 5
Duration of Impact: 3.0 years
Commonness: 10/20
Statement of Opinion:
- I might need to deal with more paperwork or verification steps to get paid.
- This could delay payments from some clients.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 4 | 5 |
| Year 2 | 5 | 5 |
| Year 3 | 5 | 5 |
| Year 5 | 6 | 5 |
| Year 10 | 6 | 5 |
| Year 20 | 6 | 5 |
Investment Advisor (Charlotte, NC)
Age: 46 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 5.0 years
Commonness: 4/20
Statement of Opinion:
- Stricter measures might initially affect market rhythms, impacting portfolio strategies.
- In the long term, reducing money laundering can stabilize and benefit global markets.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 7 |
| Year 2 | 6 | 7 |
| Year 3 | 7 | 7 |
| Year 5 | 7 | 7 |
| Year 10 | 8 | 7 |
| Year 20 | 8 | 7 |
NGO Employee (Denver, CO)
Age: 32 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 5.0 years
Commonness: 9/20
Statement of Opinion:
- Regulations might complicate receiving funds, especially from high-risk regions.
- It’s essential to ensure funds are from ethical sources, so this policy could help in that regard.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 6 |
| Year 2 | 6 | 6 |
| Year 3 | 6 | 6 |
| Year 5 | 6 | 6 |
| Year 10 | 7 | 6 |
| Year 20 | 7 | 6 |
Cost Estimates
Year 1: $8000000 (Low: $6000000, High: $10000000)
Year 2: $12000000 (Low: $10000000, High: $14000000)
Year 3: $13000000 (Low: $11000000, High: $15000000)
Year 5: $15000000 (Low: $13000000, High: $17000000)
Year 10: $20000000 (Low: $17000000, High: $23000000)
Year 100: $400000000 (Low: $350000000, High: $450000000)
Key Considerations
- The successful implementation relies on cooperation from international financial institutions and jurisdictions.
- Technical capabilities of domestic financial institutions to adhere to regulations will affect the policy's effectiveness.
- Long-term financial integrity improvements could yield substantial benefits, outweighing early compliance costs.