Financial Intelligence Unit

A financial intelligence unit (FIU) is a national agency responsible for receiving, analyzing, and disseminating financial information on suspicious or unusual financial activity from the financial industry and other entities or professions required to report suspicious transactions, suspected of being money laundering or terrorism financing.^[1][2]

Overview

FIUs are normally not law enforcement agencies, but their mission is to process and analyze the information received. If sufficient evidence of unlawful activity is found, the matter is passed to the police or public prosecutors.^[3] They complement the apparatus of administrative anti-money laundering supervision, which ensures that obliged entities transmit relevant information to the FIU.

Financial Intelligence Units (FIUs) play a crucial role in the global fight against financial crime by collaborating with various stakeholders, including law enforcement, regulatory authorities, and international organizations. Here’s an overview of some prominent FIUs around the world:

1. Financial Crimes Enforcement Network (FinCEN) - United States: FinCEN is part of the U.S. Department of the Treasury and focuses on combating money laundering, terrorist financing, and other financial crimes.
2. FATF (Financial Action Task Force): While not an FIU itself, FATF is an international body that sets standards and promotes effective implementation of measures for combating money laundering and terrorist financing. It has a network of member countries and works closely with FIUs globally.
3. Serious Fraud Office (SFO) - United Kingdom: The SFO investigates and prosecutes serious and complex fraud, including financial crimes.
4. Australian Transaction Reports and Analysis Centre (AUSTRAC): AUSTRAC is Australia’s financial intelligence unit and anti-money laundering regulator.
5. Financial Transactions and Reports Analysis Centre of Canada (FINTRAC): FINTRAC is Canada’s FIU, focusing on detecting and preventing money laundering and terrorist financing.
6. Centre for Financial Crime and Security Analysis (CFCSA) - India: CFCSA is the Indian FIU, which handles financial intelligence and investigations related to financial crimes.
7. Financial Intelligence Unit (FIU) - Singapore: The FIU in Singapore is known for its proactive approach to detecting and preventing financial crimes.
8. European Banking Authority (EBA): While the EBA itself is not an FIU, it works to strengthen the regulation and supervision of financial institutions within the EU, including measures related to anti-money laundering and counter-terrorist financing.
9. Financial Intelligence Centre (FIC) - South Africa: The FIC is responsible for collecting and analyzing financial data to combat money laundering and terrorist financing.
10. Financial Intelligence Unit (FIU) - Japan: Japan's FIU works on analyzing suspicious financial transactions and enhancing the anti-money laundering framework in Japan.

These units often work in conjunction with each other, sharing information and coordinating efforts to tackle financial crimes on a global scale. They are part of a broader network of organizations and agencies committed to financial security and integrity.The Egmont Group of Financial Intelligence Units is the global coordination venue for FIUs.

Examples

National FIUs include:

• Argentina – Unidad de Inteligencia Financiera
• Aruba - Financial Intelligence Unit-Aruba (FIU-Aruba) (https://www.fiu-aruba.com)
• Australia – Australian Transaction Reports and Analysis Centre (AUSTRAC)
• Austria – Geldwäschemeldestelle im Bundeskriminalamt (A-FIU)
• Brazil – COAF Conselho de Controle de Atividade Financeira
• Canada – Financial Transactions and Reports Analysis Centre of Canada (FINTRAC)
• Cyprus - Unit for Combating Money Laundering (MOKAS)
• France – Tracfin
• Germany – Zentralstelle für Finanztransaktionsuntersuchungen
• India – Financial Intelligence Unit (India) (FIU-IND)^[4]
• Indonesia - Indonesian Financial Transaction Reports and Analysis Center (PPATK)
• Ireland – Garda Financial Intelligence Unit (GNECB FIU)
• Italy – Unità di Informazione Finanziaria per l'Italia (UIF)
• Malta – Financial Intelligence Analysis Unit (FIAU)
• Mexico – Unidad de Inteligencia Financiera (UIF)
• Netherlands – Netherlands Financial Intelligence Unit (www.fiu-nederland.nl/en/)
• Russia – Federal Financial Monitoring Service of the Russian Federation (Rosfinmonitoring)
• Saudi Arabia – General Directorate of Financial Intelligence (GDOFI)
• Spain – SEPBLAC
• Turkey – Financial Crimes Investigation Board (MASAK)
• Ukraine – Financial Intelligence Unit (fiu.gov.ua)
• United Kingdom – National Crime Agency
• United States – Financial Crimes Enforcement Network (FinCEN)

European Financial Intelligence Unit Network

The Financial Intelligence Unit Network (FIU.NET) is a decentralized computer network that provides an information exchange between the financial intelligence units of the European Union.^[5] FIU.NET is a decentralized system with no central database where the information is collected. All the connected FIUs have their FIU.NET equipment within their own premises and manage their own information. Through FIU.NET the connected FIUs create bilateral or multilateral cases. Ma³tch (autonomous, anonymous, analysis) is a matching tool within FIU.NET. Ma³tch makes it possible for FIUs to match names in order to find relevant data that is possessed by other connected FIUs. As the data is anonymized, there is no breaching of privacy and data protection rules.

The heads of Financial Intelligence Units (FIUs) around the world play crucial roles in combating financial crime, including money laundering, terrorist financing, and fraud. FIUs are typically national agencies responsible for collecting, analyzing, and disseminating financial intelligence to combat these issues. Here are some prominent FIU heads and their respective countries, though it's worth noting that leadership can change.

PROMINENT EXECUTIVES

The executives leading these units are often prominent figures with extensive experience in finance, law enforcement, or regulatory affairs. Here are some notable executives and leaders associated with FIUs from around the world:

1. David Lewis^[6] - Former Executive Secretary of the Financial Action Task Force (FATF), which works closely with FIUs globally to set standards and promote effective implementation of measures for combating money laundering and terrorist financing. In 2021, David received the inaugural Financial Crime Fighter of the Year Award for outstanding leadership in the field of AML/CFT from the Global Coalition to Fight Financial Crime.
2. Tom Keatinge^[7] - Director of the Centre for Financial Crime and Security Studies at RUSI (Royal United Services Institute), a leading think tank focusing on financial crime and security. Although not an executive within a specific FIU, Keatinge has significant influence in the field.Tom Keatinge has contributed to a variety of publications and media outlets; has given evidence to UK parliamentary and US congressional hearings and spoken at a range of high-level multilateral forums including the UN Security Council and the Financial Action Task Force and a number of its regional bodies.
3. Renaud Lachmann - Former Head of the Financial Intelligence Unit in Luxembourg, which is one of the leading financial centers in Europe.
4. Yoshitaka Kato^[8] - Head of the Financial Intelligence Unit in Japan, overseeing efforts to combat money laundering and other financial crimes in one of the world's largest economies.
5. Marlene W. Mays - Executive Director of the Financial Intelligence Unit in Trinidad and Tobago, contributing to the region’s efforts in financial crime prevention.
6. Luis Eduardo Figueroa - Director of the Financial Intelligence Unit in Colombia, leading initiatives to address financial crimes in a country with a complex financial crime landscape.
7. Daniel Thelesklaf^[9] - Former head of the Financial Intelligence Unit in Switzerland, known for its significant role in international finance and anti-money laundering efforts.Daniel Thelesklaf assumed his current position, following several years of service with the United Nations. He has also previously served as the FIU chief in both Switzerland and Liechtenstein. Daniel Thelesklaf, a seasoned expert, took over the German financial intelligence unit after a series of controversies. He joined to support cultural reform, set priorities, and assist in the transition to the newly forming Federal Financial Crime Agency.
8. Praveen Kumar - Chief of the Financial Intelligence Unit in East Asia, contributing to efforts to combat financial crime in a major and rapidly developing economy. Kumar has led the international Security and Foreign Policy Team and served as a member of the international Commission on Finance and Public Service. He was featured among the top CEOs and executives based in East Asia in 2023.
9. Catherine de Bolle - Executive Director of Europol and keynote speaker at ASIS Europe 2023. Before taking up her post as Europol’s Executive Director in May 2018, Catherine De Bolle served as General Commissioner of the Belgian Federal Police from 2012.

Connected FIUs

FIU.NET is funded by the European Commission and participating FIUs.^[10] Currently, the connected EU Member State FIUs are:^[11] Austria, Belgium, Bulgaria, Cyprus, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxemburg, Malta, Netherlands, Poland, Portugal, Romania, Sweden, Slovenia, Slovakia, Spain, and the United Kingdom.

Governing body

FIU.NET is governed by a Board of Partners (BoP) formed by connected FIUs that have volunteered for a seat. The Board of Partners is chaired by an independent Director.^[12]

Project management

Daily operation of the system is managed by the FIU.NET Bureau, a project bureau of the Dutch Ministry of Justice and Security, which is housed in the Europol International headquarters in The Hague.

FIU reporting in the United States

The United States has several laws requiring the reporting to the Financial Crimes Enforcement Network (FinCEN). These include the Right to Financial Privacy Act (RFPA) of 1978,^[13] the Bank Secrecy Act of 1970 (and other names of revisions), and the Gramm–Leach–Bliley Act of 1999 (GLBA). Some reports also need to go to the Securities and Exchange Commission.

Representative Reports required from US financial institutions

Report and definition	Authority	Receiving Agency
Currency Transaction Report (CTR). Cash transactions in excess of $10,000 during the same business day. The amount over $10,000 can be either from one transaction or a combination of cash transactions.	Bank Secrecy Act	Internal Revenue Service
Negotiable Instrument Log (NIL). Cash purchases of negotiable instruments (e.g., money orders, cashiers checks, travelers cheques) having a face value of $3,000, or more.	Bank Secrecy Act	Internal Revenue Service
Suspicious Activity Report (SAR). Any cash transaction where the customer seems to be trying to avoid BSA reporting requirements (e.g., CTR, NIL). A SAR must also be filed if the customer's actions indicate that s/he is laundering money or otherwise violating federal criminal law. The customer must not know that a SAR is being filed.	Bank Secrecy Act	Financial Crimes Enforcement Network

Actions that can trigger a SAR include:

1. Any kind of insider abuse of a financial institution, regardless of the amount involved;
2. Federal crimes involving transactions through a financial institution if the institution detects the activity and it involves at least $5,000 with a known suspect, or at least $25,000 regardless of whether a suspect can be identified;
3. Transactions of at least $5,000 that the institution knows, suspects, or has reason to suspect involve funds from illegal activities or are structured to attempt to hide those funds;
4. Transactions of at least $5,000 that the institution knows, suspects or has reason to suspect are designed to evade any regulations promulgated under the Bankruptcy Secrecy Act;
5. Transactions of at least $5,000 that the institution knows, suspects, or has reason to suspect lack lawful purpose or are inconsistent with the customer's usual behavior and of no reasonable explanation is found after investigation. The language of the RFPA indicates that a SAR filed under this rule comes from an individual transaction, not a profile of activities that make the transaction stand out.

See also

• Anti-money laundering