FIN-2020-A008: Supplemental advisory on human trafficking (virtual currency typologies)
Document text
Research, not advice. Part of the Bitcoin research archive (October 2026). Claims labelled unverified, contested or fringe are reported, not endorsed; statuses of bills and rules are as of the date checked. Government, court and patent records are public domain; the research notes are CC BY 4.0.
FIN-2020-A008 October 15, 2020
Supplemental Advisory on Identifying and Reporting
Human Trafficking and Related Activity
Human traffickers and their facilitators exploit the innocent and most vulnerable of
our society for financial gain, employing an evolving range of money laundering
tactics to evade detection, hide their proceeds, and grow their criminal enterprise.
The Financial Crimes Enforcement Network
This Advisory should be shared with:
(FinCEN) is issuing this advisory to help save lives,
• Chief Executive Officers and to protect the most vulnerable in our society
• Chief Operating Officers from predators and cowards who prey on the
• Chief Compliance Officers innocent and defenseless for money and greed. This
advisory supplements the 2014 FinCEN Guidance
• Chief Risk Officers
on Recognizing Activity that May be Associated
• AML/BSA Departments
with Human Smuggling and Human Trafficking –
• Legal Departments Financial Red Flags (“2014 Advisory”).1
• Cyber and Security Departments
• Customer-Facing Staff Human traffickers and their facilitators exploit
• Money Services Businesses
adults and children in the United States, and
around the world, for financial gain, among other
• Casinos
reasons. Victims are placed into forced labor,
slavery, involuntary servitude, and peonage, and/
SAR Filing Request: or forced to engage in commercial sex acts. Anyone
FinCEN requests financial institutions can be a victim regardless of origin, sex, age, or
reference this advisory in SAR field legal status.2 And anyone can be a trafficker, from
2 (Filing Institution Note to FinCEN) a single individual, such as a family member,
and the narrative by including the to a criminal network, terrorist organization, or
following key term: “HUMAN corrupt government regime.3 The global COVID-19
TRAFFICKING FIN-2020-A008” and pandemic can exacerbate the conditions that
selecting SAR Field 38(h) (human contribute to human trafficking, as the support
trafficking). Additional guidance structures for potential victims collapse, and
appears near the end of this advisory.
1. FinCEN Advisory, FIN-2014-A008, “Guidance on Recognizing Activity that May be Associated with Human
Smuggling and Human Trafficking – Financial Red Flags,” (September 11, 2014).
2. See U.S. Department of Homeland Security, Blue Campaign, “What is Human Trafficking?”
3. See U.S. Department of State, “Trafficking in Persons Report,” (June 2019); see also Financial Action Task Force,
“Financial Flows from Human Trafficking,” p. 15 (July 2018).
1
F I N C E N A D V I S O R Y
traffickers target those most impacted and vulnerable.4 Other effects of the pandemic (e.g., travel
limitations, shelter-in-place orders, teleworking) also may affect the typologies and red flag
indicators provided below.
Unfortunately, in addition to the horrific toll on victims and their families, their very lives, dignity,
and livelihood, human trafficking is now one of the most profitable and violent forms of international
crime, generating an estimated $150 billion worldwide per year.5 In the United States, human
trafficking now occurs in a broad range of licit and illicit industries (e.g., hospitality, agricultural,
janitorial services, construction, restaurants, care for persons with disabilities, salon services, massage
parlors, retail, fairs and carnivals, peddling and begging, child care, domestic work, and drug
smuggling and distribution).6 Transactions involving proceeds generated by human trafficking can
be the basis for federal criminal charges and asset forfeiture, as human trafficking and associated
crimes constitute specified unlawful activities (SUAs) for the crime of money laundering.7
Since the 2014 Advisory, FinCEN collaborated with law enforcement to identify 20 new financial
and behavioral indicators of labor and sex trafficking, and four additional typologies. This
advisory provides: (i) new information to assist in identifying and reporting human trafficking, and
to aid the global effort to combat this crime; and (ii) two illustrative recent case studies. The 2014
Advisory remains relevant, and provides information related to human smuggling, in addition to
human trafficking.
Human Smuggling Human Trafficking
Acts or attempts to bring unauthorized aliens The act of recruiting, harboring,
to or into the United States, transport them transporting, providing or obtaining a
within the U.S., harbor unlawful aliens, person for forced labor or commercial sex acts
encourage entry of illegal aliens, or conspire through the use of force, fraud, or coercion.9
to commit these violations, knowingly or in
reckless disregard of illegal status.8
4. Polaris, “COVID-19 May Increase Human Trafficking in Vulnerable Communities,” (April 7, 2020). See also U.S.
Department of State, “Trafficking in Persons Report,” (June 2019) (discussing the vulnerabilities that traffickers target
globally).
5. International Labour Organization, “Profits and Poverty: The Economics of Forced Labour,” p. 13, (May 20, 2014).
See also U.S. Department of the Treasury, “Combatting Human Trafficking,” (January 29, 2020).
6. See U.S. Department of State, “Trafficking in Persons Report,” pp. 491–492 (June 2019). Relatedly, goods that are
produced by forced or child labor can be illegally imported into the United States. The U.S. Customs and Border
Protection issues Withhold and Release Orders against imported merchandise suspected of being produced from
forced or child labor. The U.S. Department of Labor maintains a list of goods and their source countries, which it has
reason to believe are produced by forced or child labor in violation of international standards.
7. SUAs relevant to human trafficking cases include a variety of offenses listed under 18 U.S.C. §§ 1956(c)(7) and
1961(1), such as those listed in Title 18, unless otherwise specified.
8. See 8 U.S.C. § 1324. See also, U.S. Department of State, “Human Trafficking and Migrant Smuggling: Understanding
the Difference,” (June 27, 2017).
9. See generally 18 U.S.C. §§ 1581, 1584, 1589, 1590, 1591, 2421, 2422, 2423, and 2425; 22 U.S.C. §§ 7102(4) and (11); The
Victims of Trafficking and Violence Protection Act of 2000 (Pub. L. No. 106-386); applicable state laws; and U.S.
Department of State, “Report on U.S. Government Efforts to Combat Trafficking in Persons,” (December 1, 2017).
2
F I N C E N A D V I S O R Y
In contrast to human smuggling, human trafficking does not require movement. Human
traffickers can exploit individuals within the border of a country, and even in a victim’s own
home. Human trafficking can also begin as human smuggling, as individuals who enter a
country voluntarily and illegally are inherently vulnerable to abuse and exploitation, and often
owe a large debt to their smuggler.10
Because the information financial institutions collect and report is vital to identifying human
trafficking and stopping the growth of this crime, it is imperative that financial institutions
enable their detection and reporting of suspicious transactions by becoming aware of the current
methodologies that traffickers and facilitators use. It is also critical that customer-facing staff are
aware of behavioral indicators that may indicate human trafficking, as the only outside contact for
victims of human trafficking may occur when visiting financial institutions.
I. New Typologies of Human Trafficking
To evade detection, hide their illicit proceeds, and profit off the backs of victims, human traffickers
employ a variety of evolving techniques. Below are four typologies, identified in Bank Secrecy Act
(BSA) data since FinCEN issued the 2014 Advisory, that human traffickers and facilitators have
used to launder money.
1. Front Companies
Human traffickers routinely establish and use front companies, sometimes legal entities, to hide
the true nature of a business, and its illicit activities, owners, and associates. Front companies are
businesses that combine illicit proceeds with those gained from legitimate business operations.
Examples of front companies used by human traffickers for labor or sex trafficking include massage
businesses, escort services, bars, restaurants, and cantinas.11 In the case of businesses that act as
a front for human trafficking, typically the establishment appears legitimate with registrations
and licenses. The front company generates revenue from sales of alcoholic beverages and cover
charges. Patrons, however, also can obtain illicit sexual services from trafficked individuals,
usually elsewhere in the establishment.12 In addition, illicit massage businesses or nail and hair
salons can offer sexual services under the guise of legitimate businesses and/or exploit individuals
for the purpose of forced labor.13 Often, these establishments will appear to be a single storefront,
yet are part of a larger network. Payments for these illicit services are usually in cash, and
traffickers may invest the illicit proceeds in high-value assets, such as real estate and cars.
10. See U.S. Immigrations and Customs Enforcement, “Human Trafficking vs Human Smuggling,” (Summer 2017); and
see also U.S. Department of State, “Human Trafficking and Migrant Smuggling: Understanding the Difference,” (June
27, 2017).
11. An establishment that provides food, drinks, dancing, and music, and is typically found in Latin American
communities.
12. See Financial Action Task Force, “Financial Flows from Human Trafficking,” p. 54 (July 2018). See also U.S.
Department of Justice, “Sex Trafficking Ring Leader Gets Life in Federal Prison,” (January 20, 2016).
13. U.S. Department of Justice, “What is Human Trafficking?” (January 6, 2017).
3
F I N C E N A D V I S O R Y
2. Exploitative Employment Practices
Some seemingly legitimate businesses use exploitative employment schemes, such as visa fraud and
wage retention, to amass profit from labor and sex trafficking. For instance, some labor recruiters
mislead or defraud victims, taking advantage of workers before and after they enter the United States.
Some labor recruiters also mislead workers about the conditions and nature of a job, engage in contract
switching, and confiscate or destroy workers’ identity documents.14 Foreign nationals who have
legitimate temporary work or student visas also can be exploited.15
Another common practice is to charge exploitative fees to workers by withholding their salary
or paying less than promised. The trafficker claims that the fees cover the costs of recruitment
or access to job opportunities.16 Recruitment fees can range from hundreds of dollars to tens of
thousands of dollars, and take years to repay.17 Victims’ salaries are transferred to the traffickers
or their co-conspirators via teller checks or wire transfers. Proceeds also can be “disguised” as a
legitimate business expense, such as a cleaning service. Financial institutions may see multiple
employees receiving their salaries in the same account, or payment for employment may be
followed by immediate withdrawal or transfer into another account.18
3. Funnel Accounts
Funnel accounts generally involve an individual or business account in one geographic area
that receives multiple cash deposits, often in amounts below the cash reporting threshold, from
which the funds are withdrawn in a different geographic area with little time elapsing between
the deposits and withdrawals.19 Human traffickers may use interstate funnel accounts to transfer
funds between geographic areas, move proceeds rapidly, and maintain anonymity.20 In labor and
sex trafficking schemes, human traffickers may open accounts in their name, or escort victims to
a bank, and force them to open an account.21 Traffickers maintain control of the victims’ bank
accounts through coercion, and direct victims to deposit money into their accounts and other
accounts that the traffickers can access.22 In some cases, victims also are coerced or forced to wire
proceeds via money services businesses (MSBs) to facilitate the funneling of proceeds.
14. U.S. Department of State, “Paying to Work: The High Cost of Recruitment Fees,” (June 27, 2017); see also U.S.
Department of Justice, “Brothers Sentenced to 20 Years for Running Violent Human Trafficking Enterprise,” (February
25, 2016).
15. U.S. Department of Justice, Journal of Federal Law and Practice, “Human Trafficking,” Executive Office of United
States Attorneys, pp. 5 and 28, (November 2017).
16. For more information see U.S. Department of Justice, “Leader of Human Trafficking Organization Sentenced to Over
15 Years for Exploiting Guatemalan Migrants at Ohio Egg Farms,” (June 27, 2016); and U.S. Department of Justice,
“Brothers Sentenced to 20 Years for Running Violent Human Trafficking Enterprise,” (February 25, 2016).
17. See U.S. Department of State, “Paying to Work: The High Cost of Recruitment Fees,” (June 27, 2017).
18. Financial Action Task Force, “Financial Flows from Human Trafficking,” p. 28, (July 2018).
19. FinCEN Advisory, FIN-2014-A005, “Update on U.S. Currency Restrictions in Mexico: Funnel Accounts and TBML,”
p. 1, (May 28, 2014).
20. See U.S. Immigration and Customs Enforcement, “Using a Financial Attack Strategy to Combat Human Trafficking,”
(January 29, 2015).
21. For additional behavioral indicators of human trafficking, see Section II, infra.
22. Policies of certain large national banks to restrict third-party cash deposits for private customer accounts seem to have
lessened the use of funnel account activity.
4
F I N C E N A D V I S O R Y
Case Study: Funnel Accounts Facilitate International Thai Sex Trafficking Ring
4. Alternative Payment Methods
In addition to payment via cash, traffickers also have accepted payment via credit cards, prepaid
cards,23 mobile payment applications, and convertible virtual currency.24 Buyers of commercial
sex use prepaid cards—a method of payment using funds paid in advance, which can be acquired
anonymously with cash or on darknet websites—to register with escort websites and to purchase
sexual services, flights, throw-away phones, and hotel rooms.25
Illicit actors also use virtual currency to advertise commercial sex online. For example, human
traffickers have purchased prepaid cards, and then used the cards to purchase virtual currency on
a peer-to-peer exchange platform. Human traffickers then use the virtual currency to buy online
advertisements that feature commercial sex acts to obtain customers.26
FinCEN also has identified transactions in which human traffickers use third-party payment
processors (TPPPs) to wire funds, which gives the appearance that the TPPP is the originator or
beneficiary of the wire transfer and conceals the true originator or beneficiary. For example, human
traffickers facilitate payments via TPPPs for the operation of online escort services and online
streaming services that use voice-over Internet protocol technology. Human traffickers and their
facilitators use TPPPs to wire funds to individuals or businesses both domestically and abroad.27
Case Study: Trafficking Involving Prepaid Cards and Bitcoin
II. Behavioral and Financial Red Flag Indicators
of Human Trafficking
In applying the red flags below and the red flags in the 2014 Advisory, financial institutions are
advised that no single red flag is a clear indicator of human trafficking activity, although each can
be indicative of forced labor and/or sex trafficking. Given that human trafficking is a predicate
offense to money laundering, the financial red flags also may be indicative of other money
laundering-related offenses. Financial institutions should consider additional factors, such as
a customer’s previous financial activity and the existence of typologies or other red flags, when
determining whether transactions may be associated with human trafficking.
23. See U.S. Department of the Treasury, “National Money Laundering Risk Assessment,” p. 15-16, (2018).
24. For more information about illicit activity involving convertible virtual currency see FinCEN Advisory,
FIN-2019-A003, “Advisory on Illicit Activity Involving Convertible Virtual Currency,” (May 9, 2019).
25. See New York County District Attorney Cyrus Vance Jr.’s testimony, “Following the Money: How Human Traffickers
Exploit the U.S. Financial Markets: Hearing before the Subcommittee on Oversight and Investigations of the
Committee on Financial Services of the U.S. House of Representatives,” (January 30, 2018). See also U.S. Department
of Homeland Security, “Using a Financial Attack Strategy to Combat Human Trafficking,” (January 29, 2015); and
U.S. Department of the Treasury, “National Money Laundering Risk Assessment,” p. 15-16, (2018).
26. See New York County District Attorney Cyrus Vance Jr.’s testimony, “Following the Money: How Human Traffickers
Exploit the U.S. Financial Markets: Hearing before the Subcommittee on Oversight and Investigations of the
Committee on Financial Services of the U.S. House of Representatives,” (January 30, 2018); and Financial Action Task
Force, “Financial Flows from Human Trafficking,” p. 55-56, (July 2018).
27. See, e.g., Financial Action Task Force, “Financial Flows from Human Trafficking,” pp. 20-26, (July 2018).
5
F I N C E N A D V I S O R Y
Behavioral Indicators
Many victims of human trafficking do not have regular contact with anyone other than their
traffickers. The only outside contact they may have is when visiting financial institutions such as
bank branches, check cashing counters, or money wiring services. Consequently, it is important that
customer-facing staff consider the following behavioral indicators when conducting transactions,28
particularly those that also present financial indicators of human trafficking schemes discussed
below. As appropriate, such information should be incorporated into Suspicious Activity Report
(SAR) filings and/or reported to law enforcement.29 When incorporated into SAR filings, it is
important that behavioral indicators, and the staff who witnessed them, are included in the SAR
narrative so that information may be effectively searched for, and later used by, law enforcement.
This list is not exhaustive and is only a selection of behavioral indicators:30
A third party speaks on behalf of the customer (a third party may insist on being present and/
or translating).
A third party insists on being present for every aspect of the transaction.
A third party attempts to fill out paperwork without consulting the customer.
A third party maintains possession and/or control of all documents or money.
A third party claims to be related to the customer, but does not know critical details.
A prospective customer uses, or attempts to use, third-party identification (of someone who is
not present) to open an account.
A third party attempts to open an account for an unqualified minor.
A third party commits acts of physical aggression or intimidation toward the customer.
A customer shows signs of poor hygiene, malnourishment, fatigue, signs of physical and/or
sexual abuse, physical restraint, confinement, or torture.
A customer shows lack of knowledge of their whereabouts, cannot clarify where they live or
where they are staying, or provides scripted, confusing, or inconsistent stories in response to
inquiry.
28. Additional resources discussing human trafficking and the role of financial institutions include the U.S. Department
of Homeland Security, Blue Campaign, “Resources Page”; U.S. Department of the Treasury, “Combatting Human
Trafficking,” (January, 29, 2020); U.S. Department of State, “Tracking Suspicious Financial Activity to Address Human
Trafficking,” (June 28, 2018); U.S. Immigration and Customs Enforcement, “Using a Financial Attack Strategy to
Combat Human Trafficking,” (January 29, 2015); and Financial Action Task Force, “Financial Flows from Human
Trafficking,” (July 2018).
29. To report suspicious activity indicative of human trafficking to the U.S. Immigration and Customs Enforcement (ICE)
Homeland Security Investigations (HSI) Tip Line, call 1-866-DHS-2-ICE (1-866-347-2423) 24 hours a day, seven days a
week, every day of the year. The Tip Line is also accessible outside the United States by calling 802-872-6199.
30. See Organization for Security and Co-operation in Europe, “Following the Money: Compendium of Resources and
Step-by-step Guide to Financial Investigations into Trafficking in Human Beings,” (November 7, 2019).
6
F I N C E N A D V I S O R Y
Financial Indicators
To help identify and report transactions possibly associated with human trafficking, FinCEN
has identified 10 new financial red flag indicators. These red flags do not replace the red flags
identified in the 2014 Advisory, all of which remain relevant.31 The Financial Action Task Force
report on the “Financial Flows from Human Trafficking” also provides numerous indicators of
money laundering related to human trafficking.32
Customers frequently appear to move through, and transact from, different geographic
locations in the United States. These transactions can be combined with travel and
transactions in and to foreign countries that are significant conduits for human trafficking.33
Transactions are inconsistent with a customer’s expected activity and/or line of business in
an apparent effort to cover trafficking victims’ living costs, including housing (e.g., hotel,
motel, short-term rentals, or residential accommodations), transportation (e.g., airplane, taxi,
limousine, or rideshare services), medical expenses, pharmacies, clothing, grocery stores, and
restaurants, to include fast food eateries.
Transactional activity largely occurs outside of normal business operating hours (e.g., an
establishment that operates during the day has a large number of transactions at night), is
almost always made in cash, and deposits are larger than what is expected for the business
and the size of its operations.
A customer frequently makes cash deposits with no Automated Clearing House (ACH) payments.
An individual frequently purchases and uses prepaid access cards.
A customer’s account shares common identifiers, such as a telephone number, email, and
social media handle, or address, associated with escort agency websites and commercial sex
advertisements.
Frequent transactions with online classified sites that are based in foreign jurisdictions.
A customer frequently sends or receives funds via cryptocurrency to or from darknet markets
or services known to be associated with illicit activity. This may include services that host
advertising content for illicit services, sell illicit content, or financial institutions that allow
prepaid cards to pay for cryptocurrencies without appropriate risk mitigation controls.
Frequent transactions using third-party payment processors that conceal the originators and/
or beneficiaries of the transactions.
A customer avoids transactions that require identification documents or that trigger reporting
requirements.
31. FinCEN Advisory, FIN-2014-A008, “Guidance on Recognizing Activity that May be Associated with Human
Smuggling and Human Trafficking – Financial Red Flags,” (September 11, 2014).
32. Financial Action Task Force, “Financial Flows from Human Trafficking,” pp. 65-70, (July 2018).
33. For information on specific countries, and whether they are conduits for human trafficking, see U.S. Department of
State, “Trafficking in Persons Report,” (June 2019).
7
F I N C E N A D V I S O R Y
Case Studies
Funnel Accounts Facilitate International Thai Sex Trafficking Ring
In December 2018, 36 defendants were found guilty in St. Paul, Minnesota, for their various
roles in operating an international sex trafficking ring, i.e., traffickers, house bosses, money
launderers, and facilitators. Traffickers based in Thailand lured women to the United States
through false promises of a better life. To facilitate the transport of the victims, the organization
engaged in visa fraud by creating false identification documents, and forced many of the
victims to enter into fraudulent marriages and debt bondage. In exchange, each victim incurred
a debt of $55,000, which far exceeded actual expenses. Once in the United States, the victims
were sent to various cities, isolated in a residence, and forced to pay off their debt by engaging
in commercial sex acts.34
To conceal and redistribute the proceeds of the sex trafficking business, victims were forced
to open U.S. bank accounts in Los Angeles in their own names. Once an account was opened,
however, traffickers based in the United States took control of the account, kept a percentage of
the cash generated, and sent the remainder back to the traffickers in Thailand. Other members
of the organization, the “facilitators,” rented the houses, apartments, and hotels, and facilitated
the transport of victims.
The organization used funnel accounts to launder money deposited in cities across the United
States to third-party launderers who made cash withdrawals in Los Angeles.35 According to data
made available to FinCEN, deposits were made in cash, and were just enough to cover account
debits. To move funds to and from Thailand, the organization employed third-party money
launderers who made bank accounts available and coordinated cash deposits and withdrawals.
Bulk cash smuggling was another scheme used to physically transport proceeds to Thailand.
According to law enforcement, individuals were recruited to carry large volumes of cash in
suitcases and transport the money to Thailand. To evade detection, the trafficking organization
paid flight attendants to keep quiet, and in some limited instances, to transport bulk cash
in their own luggage. Money also was concealed in clothing and dolls that were shipped to
Thailand. To date, law enforcement has recovered $1.5 million in cash, and testimony revealed
that more than $40 million was sent to Thailand by one money launderer alone.
34. For information on this case, see U.S. Department of Justice, “Twenty-One Additional Defendants Indicted for their
Roles in Thai Sex Trafficking Enterprise,” (May 25, 2017); see also U.S. Department of Justice, “Thirty-Six Defendants
Guilty for their Roles in International Thai Sex Trafficking Organization,” (December 13, 2018).
35. For a definition of third-party money launderers see U.S. Department of Homeland Security, “Third Party Money
Launderers,” (Summer 2017).
8
F I N C E N A D V I S O R Y
Trafficking Involving Prepaid Cards and Bitcoin
In April 2016, law enforcement agents from HSI in El Paso, Texas, responded to a call made
to local police regarding a woman who was being forcibly held by an individual identified as
“Tae” at a motel. Officers discovered two adult victims when they searched the motel room.
Police located William “Tae” Harris, who was stopped while driving a suspect vehicle in the
area. He possessed a semi-automatic firearm. Harris and his passenger, Dean Hall, were
members of the West Side City Crips gang from Phoenix, Arizona.
The subsequent HSI investigation revealed that Harris and Hall brought the victims to Texas
from Arizona, where the victims were forced into prostitution, beaten, and suffered threats
of violence. HSI determined that at least three other West Side City Crips were operating a
prostitution scheme in El Paso. During a forensic extraction of Harris’ mobile phone, HSI
discovered bitcoin transaction data and was able to exploit Harris’ bitcoin wallet information.
Evidence revealed that the group’s illicit activity revolved around the purchase of Vanilla
Visa prepaid credit cards, which were then used to purchase bitcoin on the Paxful virtual
currency exchange. Those bitcoin were used to purchase prostitution ads on Backpage.com.
Furthermore, during Harris’ prosecution, HSI uncovered and disrupted an attempted murder-
for-hire in which Harris planned to have a key witness and her sister murdered.
In January 2018, Hall and Harris were convicted and sentenced for violating several anti-
trafficking statutes. Hall was sentenced to 90 months’ imprisonment and five years of
supervised release, and Harris was sentenced to 180 months’ imprisonment and ten years of
supervised release.
Guidance to U.S. Financial Institutions
Customer Due Diligence and Identification of
Beneficial Owners of New Legal Entity Accounts
As of May 11, 2018, FinCEN’s Customer Due Diligence (CDD) Rule requires banks, brokers or
dealers in securities, mutual funds, and futures commission merchants and introducing brokers
in commodities to identify and verify the identity of beneficial owners of legal entity customers,
subject to certain exclusions and exemptions.36 Identifying and verifying the beneficial owners
of legal entities could facilitate the identification of the beneficiaries of the illicit proceeds.
36. See 31 CFR § 1010.230 (describing beneficial ownership requirements for legal entity customers).
9
F I N C E N A D V I S O R Y
Information Sharing
Information sharing among financial institutions is critical to identifying, reporting, and
preventing evolving fraud schemes. Financial institutions sharing information under the safe
harbor authorized by section 314(b) of the USA PATRIOT Act are reminded that they may share
information relating to transactions that the institution suspects may involve the proceeds of
one or more SUAs and such an institution still will remain protected from civil liability under
section 314(b) safe harbor. The SUAs listed in 18 U.S.C. §§ 1956 and 1957 include an array of
fraudulent and other criminal activities, including fraud against individuals or the government.
FinCEN strongly encourages information sharing via section 314(b) where financial institutions
suspect that a transaction may involve terrorist financing or money laundering, including one
or more SUAs.37
Suspicious Activity Reporting (SAR)
A financial institution is required to file a SAR if it knows, suspects, or has reason to suspect a
transaction conducted or attempted by, at, or through the financial institution involves funds
derived from illegal activity, or attempts to disguise funds derived from illegal activity; is
designed to evade regulations promulgated under the BSA; lacks a business or apparent lawful
purpose; or involves the use of the financial institution to facilitate criminal activity.38
SAR Filing Instructions
Financial institutions should provide all pertinent available information in the SAR form and
narrative. A potential victim of human trafficking should not be reported as the subject of a
SAR. Rather, all available information on the victim should be included in the narrative portion
of the SAR. FinCEN further requests that financial institutions reference this advisory by
including the key term:
“HUMAN TRAFFICKING FIN-2020-A008”
in SAR field 2 (Filing Institution Note to FinCEN) to indicate a connection between the
suspicious activity being reported and the activities highlighted in this advisory. Additional
information to include behavioral indicators, email addresses, phone numbers, and IP addresses
also should be included when possible to aid law enforcement investigations.
37. For further guidance related to the 314(b) Program, see FinCEN Section 314(b) Fact Sheet (November 2016), and
FinCEN Guidance FIN-2009-G002, “Guidance on the Scope of Permissible Information Sharing Covered by Section
314(b) Safe Harbor of the USA PATRIOT Act,” (June 16, 2009).
38. 31 CFR §§ 1020.320, 1021.320, 1022.320, 1023.320, 1024.320, 1025.320, 1026.320, 1029.320, and 1030.320.
10
F I N C E N A D V I S O R Y
Financial institutions that suspect human trafficking activity should also mark the check box
for human trafficking (SAR Field 38(h)) on the SAR form.
For Further Information
Questions or comments regarding the contents of this advisory should be addressed to the FinCEN
Regulatory Support Section at [email protected].
The mission of the Financial Crimes Enforcement Network is to safeguard
the financial system from illicit use, combat money laundering and its
related crimes including terrorism, and promote national security through
the strategic use of financial authorities and the collection, analysis, and
dissemination of financial intelligence.
11