FinCen’s Geographic Targeting Order is Anti-small business Red Tape and a General Warrant

A recent geographic targeting order put out by the Financial Crimes Enforcement Network of the treasury department requires all money service businesses within 30 zipcodes of Texas and California to complete and file currency transaction reports for all cash transactions over $200. In the rest of the country this is only required for all cash transactions over $10,000. While large multinational money service businesses such as Western Union and Moneygram have automated the process of creating currency transaction reports and can create such reports within 8 minutes on average, neighborhood money service businesses run by local proprietors such as Novedades y Servicios, Inc.(News and Services) have to complete such reports manually which takes an average of 24 minutes. This is costing the neighborhood money service businesses clients because nearly every transaction they deal with is over $200 but less than $10K and the time consumed by filling out currency transaction reports reduces the number of clients they can serve every day. If Novedades y Servicios, Inc. keeps the same average workload after the geographic targeting order went into effect on April 14th, the new >$200 transaction reporting requirement will require an estimated 445 to 518 hours of additional labor per month (15-17 hours per day) to comply with it. Note: there are only about 730 hours in a month so this absurdly low reporting requirement will cause them to lose nearly all of their clients to large multinational money service businesses with automated currency transaction reports or neighborhood money service businesses in adjacent zipcodes not included in the current geographic targeting order.

The clients swept up in this dragnet financial surveillance include people who pay rent by money order since there is no rent in the U.S. under $200, people cashing their bi-weekly paycheck, even federal minimum wage workers will make over $200 a week, and people sending money to family abroad. This is the 21st century equivalent of the writs of assistance. The vast majority of people who use money service businesses have no involvement in drug trafficking or money laundering yet under this geographic targeting order they are subject to indefinite searches and treated as suspects without any probable cause or individualized suspicion of a crime.Since the government publicized this policy change and is not doing it covertly actual criminals had time to adjust their schemes to circumvent the new dragnet. Actual cartel operatives will simply move their money laundering operations to adjacent zip codes that are not included in the geographical targeting order, of which there are plenty, or to New Mexico and Arizona which are not included in the geographical targeting order. And cartels are well more likely to launder their money through legitimate fronts like restaurants and bars and big banks like HSBC than neighborhood check cashing businesses.