Search and arrest warrants had been obtained for Gerry (not his real name of course). Gerry—who was accused of operating an unlicensed money services business—had few redeeming qualities. He would move money for the devil himself if the price was right. It is highly unlikely that he has ever been accused of being a nice guy. For this otherwise routine suspicious activity report team task force case, a number of agents with that “men in black” persona arrived for the operation briefing. They were there because Gerry, and a number of his clients, had many red flags for potential terrorist financing.
One such secret agent—referred to as X since even the name he gave was not likely his real one—began quizzing the primary case agent about the information and intelligence gathered on the case. X seemed to have a special interest in one of Gerry’s clients. He appeared shocked that the case agent had such detailed information on this subject since this was considered to be top-secret intelligence. X forcefully demanded the case agent’s source of intelligence. The case agent simply replied, “Google!”
A common incongruity is most people saying they disapprove of Congress, but still saying they approve of their particular Congress member. The same way of thinking can apply to investigator views on information and intelligence silos. While many in anti-money laundering (AML) clearly recognize how information kept in separate silos has been detrimental to the overall AML mission, many still remain reluctant to disseminate or share the information from their own such silo. Information and intelligence held within these silos often comes to light only after a separately reported event or enforcement action exposes them belatedly to the other investigation. Instead of regretting how that information was not used productively earlier in the other investigation, professionals inside the silo will feel validated by their information collection. This validation will hold more weight than any laments that it had not been effectively used.
This phenomenon is definitely not limited to AML. Most investigators have had investigations be unwittingly compromised by another investigator taking actions on a parallel investigation of which they were unaware. Investigators are even known to have ignored existing deconfliction protocols under the guise that their case was too sensitive or too confidential to be exposed. The implied secrecy and further implied confidentiality of financial activities only leads to more information being hoarded than effectively shared. In this paradox, this financial analysis and intelligence will never be disseminated for its intended investigative value. The bypassed investigator finds solace in the information being validated, even though it was not shared or disseminated when it would have benefited the investigation the most.
While many in anti-money laundering (AML) clearly recognize how information kept in separate silos has been detrimental to the overall AML mission, many still remain reluctant to disseminate or share the information from their own such silo
Financial institutions (FIs) commonly keep information in silos, separated even from other parts of those institutions. Even under subpoenas, FIs will not provide information that may exist but is not easily accessible. Requesting investigators often do not understand that while the bank name may be the same, departments like checking and savings are completely different entities from credit cards, car loans or mortgage departments. Rarely will there be any compliance from the section other than where the original subpoena was sent. Policies directing more complete compliance to the broad scope most subpoenas seek are all but nonexistent. The processors assume what information may or may not be needed by investigators without any idea as to the nature and scope of the investigation for which they are making that assessment. Anything evidential is perceived to be specific and already known to the investigator. Potential discoveries through random analysis are not considered. Another commonly prevailing assumption is that subpoena verbiage seeking “everything” means the requester is uncertain. That perceived uncertainty results in minimal compliance until “everything” is more specifically defined. There are few if any ramifications when the initial compliance is minimal.
The need for secrecy and confidentiality is perpetually reinforced at nearly every level of an FI
However, this is actually a foreseeable and understandable reaction. The need for secrecy and confidentiality is perpetually reinforced at nearly every level of an FI. Permission for any dissemination outside of clearly defined parameters is reserved to only a special few. After all, exposing a person’s financial profile can be an intrusion with potentially damaging societal consequences. Emotionally speaking, exposing as lies and deceptions what had been commonly accepted about an individual’s personal finances can be devastating. A whole lot of broke folks hide it well. That is why law enforcement (LE) entities know all too well just how hard it is to obtain IRS tax records. Even when the records are obtained, LE are reminded of the draconian sanctions for improper dissemination rather than any encouragement on using them for their potential investigative value. With the Financial Crimes Enforcement Network (FinCEN), the protections against improper dissemination dominate. They are constantly reinforced long before any access to the data is permitted. Penalties for misuse are often greater than penalties for the crime under investigation.
This also is not limited to the FIs. LE is just as reluctant to release any proprietary information and intelligence they maintain to another department or agency simply because it might be helpful for the good of a case. Competition for case credit is nearly as fierce as competition for profits in the private sector. Rules for the partnerships are established long before any silos of information are merged. Experienced investigators are all too familiar with cases where lack of information sharing has adversely impacted or frustrated their investigations.
There is a line where collecting intelligence becomes hoarding and what is true for “stuff” that is hoarded is true for intelligence: It depreciates in value and rots over time
Analyzing successful cases by using a hindsight, or a look-back approach, can still have valuable lessons in learning to think outside of silos. This is especially valuable when realizing a particular silo of information was relevant to a case it never became a critical part of, but should have. Knowing where, and even when, that information may have played a key role in the investigation may inform when and where similar information may intersect with other silos. This point needs to be considered the endgame for information collection. Simply validating the accuracy, or proof of concept, is not a productive reason. There is a line where collecting intelligence becomes hoarding and what is true for “stuff” that is hoarded is true for intelligence: It depreciates in value and rots over time.
These issues have been, and are, well known in both the public and private sectors. LE has attempted to address these issues by forming task forces and various “fusion centers” to provide better information-sharing platforms between enforcement agencies. In AML, this recognition can be seen in the emerging variations and evolution of the “314” processes. In either sector, “skeptical” or “apprehensive” still prevail over “cooperation” and “openness” in describing practical application experiences of these efforts.
For now, thinking outside of silos is mostly wishful thinking. Both FIs and LE tend to like their own silos so much they fail to see the rust forming. Are you collecting or hoarding?
Steve Gurdak, CAMS, supervisor, Washington Baltimore HIDTA, Northern Virginia Financial Initiative (NVFI), Annandale, VA, USA, firstname.lastname@example.org
Disclaimer: The views expressed are solely those of the author and are not meant to represent the opinions of the W/B HIDTA.