FinCEN Wants You to Help Fight Foreign Kleptocrats
3. Insurers have a separate obligation to send FinCEN suspicious activity reports.
The Form 8300 is meant for reporting cash payments that, in many cases, have nothing to do with crime.
Insurers that believe a large cash payment or any other transaction seems highly suspicious are supposed to file separate suspicious activity reports.
SAR requirements do not affect group insurance products, charitable annuities, health insurance, term life insurance or reinsurance contracts.
The requirements do affect issuers of individual permanent life insurance policies, such as whole life policies and universal life policies; individual annuity contracts; and any other individual insurance products with cash-value features.
4. Insurers are supposed to tell you what they want you to do about large cash payments and and other red flag behavior.
The insurers you work with are supposed to have anti-money laundering programs. Those programs should include procedures you can use to tell the insurers about potential problems.
5. FinCEN might take a long time to use any information you help file.
Frank Vogl, the co-founder of Transparency International, said Thursday, during an interview on the PBS show Amanpour & Company, that FinCEN has had to few analysts available to go through SARs thoroughly, and that it needs more money and more analysts.
Financial services groups could play a role in helping FinCEN get the resources it needs to make effective use of reports, and they may also be able to help by sharing some of the kinds of tools they use to detect credit card fraud and insurance claim fraud.
6. Stepped-up efforts to detect and stop kleptocrats may trip up law-abiding people.
Some existing financial services industry “know your customer” rules can lead to complicated bureaucratic mazes for young people who are just starting out or adults who move.
In some European countries, for example, simply getting a local bank account that suits local conditions is often difficult, because local banks may refuse to file the reports required by the U.S. Foreign Account Tax Compliance Act for for customers with relatively small checking or savings accounts.
Organizations such as the Financial Planning Association, Finseca, the National Association of Insurance Commissioners and the National Association of Insurance and Financial Advisors might have a role in getting FinCEN’s attention if new kleptocrat nets catch too many of the wrong fish.
(Image: Sergey Mironov/Shutterstock)
