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FinCEN Reports on Suspicious Activity in Puerto Rico

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FinCEN Reports on Suspicious Activity in Puerto Rico

Last year, over 47,000 suspicious activity reports (SARs) of transactions carried out in Puerto Rico were reported to the Financial Crimes Network (FinCEN), according to the agency’s director, Andrea Gacki. These reports were a part of a larger effort to combat money laundering and financial fraud on the island and were revealed during Gacki’s visit to Puerto Rico on Thursday.

Of the thousands of SAR reports made in Puerto Rico, almost 700 described possible fraud related to government aid or benefits, highlighting the prevalence of financial crimes in the region. While check fraud was the largest category of suspected fraud activity in the United States, it was not as frequently cited in relation to Puerto Rico. Money laundering was another significant area of concern, with transactions below the established record-keeping threshold and the suspicious use of multiple locations.

The federal official also addressed the issue of scams reported on the island, noting that the most frequent were those of the “good Samaritan” and those involving online purchases, especially vehicles and services. As part of its anti-money laundering strategies, FinCEN implemented new regulations requiring all limited liability entities or LLCs in the United States and territories, including Puerto Rico, to complete a beneficial ownership report (BOI), with more than 642,000 notifications submitted since the initiative was launched on January 1.

Gacki also spoke about the nation’s opioid crisis, which continues to affect communities throughout the country, with Puerto Rico being one of the main transshipment points. Recent cases reported on the island included accusations of individuals in possession of firearms and conspiracy to distribute substances, as well as arrests related to large-scale fentanyl and fentanyl-adjacent operations. “FinCEN and the Treasury Department are critical participants in the President’s National Drug Control Strategy,” Gacki said, emphasizing the role of the agency in combating transnational criminal organizations involved in drug trafficking.

Despite classifying Puerto Rico as a risky jurisdiction, Gacki stressed that there has been progress, with significant prosecutions, enforcement actions, and new regulations aimed at addressing known risks and vulnerabilities. Recently, the federal Treasury eliminated international financial institutions and savings and credit cooperatives from its list of vulnerabilities and risks related to anti-money laundering and counter-financing of terrorism in the United States.

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However, Gacki assured that the agency will continue to supervise and promote greater compliance, particularly in non-traditional sectors. As an example, she cited the recent action against an International Banking Entity (EBI) in Puerto Rico that resulted in a $15 million fine for intentional violations of the Bank Secrecy Act and other compliance failures.

Gacki concluded by expressing hopes for continued collaboration with authorities and the private sector in Puerto Rico, emphasizing the importance of protecting the financial system from harm through collective efforts.

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