Barriers to Family Suspicious Activity Reporting (SAR) of Mobilization Behaviors and Pre-Operational Planning: Report to the U.S. Department of Homeland Security

The Nationwide Suspicious Activity Reporting (SAR) Initiative (NSI) is one of many tools used by law enforcement to help prevent terrorism and terrorism-related activity (see Figure 1). In addition to state, local, tribal, and territorial (SLTT) agencies and federal law enforcement, the Department of Homeland Security (DHS) relies on communities to report suspicious behaviors. While much is known about the actual SAR process, 1 less is known about an essential segment of the community: family members. Family members of violent extremists (VE) play an important role in countering violent extremism (CVE), whether by supporting disengagement and deradicalization or by alerting authorities when concerned for the safety of their loved one(s) and/or others. However, due to issues like mistrust and fear of law enforcement, or a general lack of understanding about SAR and the investigative process, family members may be reluctant to report suspicious behaviors. This fundamental issue reduces the effectiveness of any CVE program or policy. It thus warrants an investigation into how law enforcement agencies can better support and promote family members reporting of suspicious activity. This report seeks to determine whether the DHS and the NSI collaborative have protocols to address family engagement in CVE and report suspicious behaviors. The following two research questions will guide the remainder of this report: (1) How do SAR trainings address family engagement in suspicious reporting? (2) How do members of the NSI collaborative perceive family engagement in the SAR process (i.e., report suspicious behavior)

Attempts to Dodge Drowning in Data. Rule- and Risk-Based Anti Money Laundering Policies Compared

Both in the US and in Europe anti money laundering policy switched from a rule- to a risk-based reporting system in order to avoid over-reporting by the private sector. However, reporting increased in most countries, while the quality of information decreased. Governments drowned in data because private agents feared sanctions for not reporting. This ``crying wolf'' problem. (Takats 2007) did not happen in the Netherlands, where the number of reports diminished but information quality improved. Reasons for this can be found in differences in legal institutions and legal culture, notably the contrast between US adversarial legalism and Dutch cooperative informalism. The established legal systems also provide for resistance to change. Thus lowering sanctions in order to reduce over-reporting may not be a realistic option in a legal system which traditionally uses deterrence by fierce criminal and private legal sanctions. Furthermore, a risk-based approach may not be sustainable in the long run, as litigation may eventually replace a risk-based approach again by a rule-based one, now with precise rules set by the courts.money laundering, anti money laundering policy, risk based regulation, rules, standards, comparison of legal systems, tort law

Bank Secrecy Act: FinCEN Needs to Further Develop Its Form Revision Process for Suspicious Activity Reports

Testimony issued by the Government Accountability Office with an abstract that begins "To assist law enforcement agencies in their efforts to combat money laundering, terrorist financing, and other financial crimes, the Bank Secrecy Act (BSA) requires financial institutions to file suspicious activity reports (SAR) to inform the federal government of transactions related to possible violations of law or regulation. Depository institutions have been concerned about the resources required to file SARs and the extent to which SARs are used. The Subcommittee asked GAO to discuss our February 2009 report on suspicious activity reporting. Specifically, this testimony discusses (1) factors affecting the number of SARs filed, (2) actions agencies have taken to improve the usefulness of SARs, (3) federal agencies' use of SARs, and (4) the effectiveness of the process used to revise SAR forms. To respond to the request, GAO relied primarily on the February 2009 report titled Bank Secrecy Act: Suspicious Activity Report Use Is Increasing, but FinCEN Needs to Further Develop and Document Its Form Revision Process (GAO-09-226), and updated it with additional information provided by FinCEN. In that report, GAO recommended that FinCEN work to further develop a strategy that fully incorporates certain GAO-identified practices to enhance and sustain collaboration among federal agencies into the forms-change process.

Supplement to MTI Study on Selective Passenger Screening in the Mass Transit Rail Environment, MTI Report 09-05

This supplement updates and adds to MTIs 2007 report on Selective Screening of Rail Passengers (Jenkins and Butterworth MTI 07-06: Selective Screening of Rail Passengers). The report reviews current screening programs implemented (or planned) by nine transit agencies, identifying best practices. The authors also discuss why three other transit agencies decided not to implement passenger screening at this time. The supplement reconfirms earlier conclusions that selective screening is a viable security option, but that effective screening must be based on clear policies and carefully managed to avoid perceptions of racial or ethnic profiling, and that screening must have public support. The supplement also addresses new developments, such as vapor-wake detection canines, continuing challenges, and areas of debate. Those interested should also read MTI S-09-01 Rail Passenger Selective Screening Summit

Rail Passenger Selective Screening Summit, MTI S-09-01

This publication is an edited transcript of the Rail Passenger Selective Screening Summit, which was co-sponsored by MTI and the American Public Transportation Association (APTA) in Chicago, Illinois on June 18, 2009, during APTA´s annual Rail Conference. The workshop was moderated by Brian Michael Jenkins, director, Mineta Transportation Institute\u27s National Transportation Security Center of Excellence (NTSCOE). Speakers included Bruce R. Butterworth, co-author, Selective Screening of Rail Passengers; Greg Hull, president, American Public Transportation Association (APTA); Paul MacMillan, chief of police, Massachusetts Bay Transportation Authority, Transit Police Department; Ron Masciana, deputy chief, Metropolitan Transit Authority (MTA), New York; Jesus Ojeda, security coordinator, Southern California Regional Rail Authority; Ed Phillips, operations deputy, Office of Security, Amtrak; and John P. Sammon, assistant administrator, Transportation Sector Network Management, Transportation Security Administration (TSA

Losing the War Against Dirty Money: Rethinking Global Standards on Preventing Money Laundering and Terrorism Financing

Following a brief overview in Part I.A of the overall system to prevent money laundering, Part I.B describes the role of the private sector, which is to identify customers, create a profile of their legitimate activities, keep detailed records of clients and their transactions, monitor their transactions to see if they conform to their profile, examine further any unusual transactions, and report to the government any suspicious transactions. Part I.C continues the description of the preventive measures system by describing the government\u27s role, which is to assist the private sector in identifying suspicious transactions, ensure compliance with the preventive measures requirements, and analyze suspicious transaction reports to determine those that should be investigated. Parts I.D and I.E examine the effectiveness of this system. Part I.D discusses successes and failures in the private sector\u27s role. Borrowing from theory concerning the effectiveness of private sector unfunded mandates, this Part reviews why many aspects of the system are failing, focusing on the subjectivity of the mandate, the disincentives to comply, and the lack of comprehensive data on client identification and transactions. It notes that the system includes an inherent contradiction: the public sector is tasked with informing the private sector how best to detect launderers and terrorists, but to do so could act as a road map on how to avoid detection should such information fall into the wrong hands. Part I.D discusses how financial institutions do not and cannot use scientifically tested statistical means to determine if a particular client or set of transactions is more likely than others to indicate criminal activity. Part I.D then turns to a discussion of a few issues regarding the impact the system has but that are not related to effectiveness, followed by a summary and analysis of how flaws might be addressed. Part I.E continues by discussing the successes and failures in the public sector\u27s role. It reviews why the system is failing, focusing on the lack of assistance to the private sector in and the lack of necessary data on client identification and transactions. It also discusses how financial intelligence units, like financial institutions, do not and cannot use scientifically tested statistical means to determine probabilities of criminal activity. Part I concludes with a summary and analysis tying both private and public roles together. Part II then turns to a review of certain current techniques for selecting income tax returns for audit. After an overview of the system, Part II first discusses the limited role of the private sector in providing tax administrators with information, comparing this to the far greater role the private sector plays in implementing preventive measures. Next, this Part turns to consider how tax administrators, particularly the U.S. Internal Revenue Service, select taxpayers for audit, comparing this to the role of both the private and public sectors in implementing preventive measures. It focuses on how some tax administrations use scientifically tested statistical means to determine probabilities of tax evasion. Part II then suggests how flaws in both private and public roles of implementing money laundering and terrorism financing preventive measures might be theoretically addressed by borrowing from the experience of tax administration. Part II concludes with a short summary and analysis that relates these conclusions to the preventive measures system. Referring to the analyses in Parts I and II, Part III suggests changes to the current preventive measures standard. It suggests that financial intelligence units should be uniquely tasked with analyzing and selecting clients and transactions for further investigation for money laundering and terrorism financing. The private sector\u27s role should be restricted to identifying customers, creating an initial profile of their legitimate activities, and reporting such information and all client transactions to financial intelligence units

An exploratory study in to the money laundering threats, vulnerabilities, and controls within the UK bookmaker sector, with a specific focus on Fixed-Odds Betting Terminals

The purpose of this exploratory study was to generate an understanding in to the money laundering threats, vulnerabilities and controls found within UK betting shops, with a direct focus on the exponential growth of Fixed-Odd Betting Terminals. Qualitative research methods facilitated eight semi-structured interviews with key stakeholders linked to the gambling and/or money laundering sphere. This included the Gambling Commission, Campaign for Fairer Gambling, an ex-Head of Security and Safety at a major bookmaker, and five regular Fixed-Odd Betting Terminal users. The interviews were recorded, transcribed and coded for thematic analysis, subsequently resulting in the emergence of four interesting and meaningful themes. These were (1) Ineffective CDD enforcement facilitating anonymity (2) Weak anti-money laundering safeguards unable to mitigate known threats (3) A lack of anti-money laundering training, awareness, and resources (4) The Gambling Commission’s attempt for increased anti-money laundering regulation unsuccessful. By allowing a phenomenological framework to guide the data collection process, the interpreted subjective views and experiences of the participants involved, although somewhat limited, indicate that money laundering threats within the bookmaker sector are inherently high, with a lack of effective safeguards in place to mitigate the identified vulnerabilities

Policing Uncertainty: On Suspicious Activity Reporting

A number of the men who would become the 9/11 hijackers were stopped for minor traffic violations. They were pulled over by police officers for speeding or caught by random inspection without a driver’s license. For United States government commissions and the press, these brushes with the law were missed opportunities. For some police officers though, they were of personal and professional significance. These officers replayed the incidents of contact with the 19 men, which lay bare the uncertainty of every encounter, whether a traffic stop, or with someone taking photos of a landmark. Representatives from law enforcement began to design policies to include local police in national intelligence, with the idea of capitalizing on what patrol officers already do in dealing with the general public. Several initiatives were launched, among these, the Suspicious Activity Reporting Initiative. Routine reporting of suspicious activity was developed into steps for gathering, assessing and sharing terrorism-related information with a larger law enforcement and intelligence network. Through empirical analysis of counterterrorism efforts and recent scholarship on it, this chapter discusses prevention, preemption, and anticipation as three technologies of security, focusing on how each deals with uncertainty. The Suspicious Activity Reporting Initiative, this analysis suggests, is an anticipatory technology which constitutes police officers and intelligence analysts as subjects who work in a mode of uncertainty.

Law Enforcement Intelligence: Implications for Self-Radicalized Terrorism

A series of tragic events over the last three years has further strengthened the emerging preventative and proactive philosophies adopted by US law enforcement post-September 11, 2001. Law enforcement and the American public now have a heightened awareness of homegrown terrorism. While these terrorist actors operate independent of traditional terrorist networks and groups, they are often influenced by such groups through a process where they enter as a non-violent individual and exit as a violent ‘true believer’. Efforts by law enforcement to mitigate or prevent such threats rely on the implementation of intelligence-led policing practices. Central to these practices is the input of raw information into the intelligence cycle. This paper will discuss the importance and application of suspicious activity reporting as it impacts law enforcement intelligence practices to prevent threats from self-radicalized terrorism