Security agencies oppose congressional move to ease banking reporting requirements
Some federal agencies are in opposition to possible new bank reporting requirements because they feel relaxing regulations may compromise homeland security
Federal law enforcement agencies are anxious about the possibility that the Department of Treasury may decide to lighten the burden on banks to report certain transactional information, saying such regulatory reform would undermine the ability to expose money-laundering schemes used to fund terrorism. The House approved legislation last month relieving banks from financial reporting requirements, arguing that banks are burdened by excessive paperwork obligations. Similar legislation may soon be introduced in the Senate. Nevertheless, Senator Paul Sarbanes (D-Maryland), the ranking Democrat on the Senate Banking, Housing and Urban Affairs Committee, has reservations about easing reporting requirements mandated in the Bank Secrecy Act (BSA). Those requirements yield important information for federal money-laundering investigations.
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Records produced and maintained by financial institutions under BSA are of great value to investigate money laundering and terrorism funding, Michael Morehart, chief of the FBI’s terrorist financing operations section, told the Senate Banking Committee on Tuesday.
