The US Treasury Department's Financial Crimes Enforcement Network (FinCEN) will track cash transactions in some geographical regions in the United States to address illegal activities, as per a report.
The regulation, designed to help fight money laundering and cut the operations of Mexico-based drug cartels, could end up expanding government surveillance of its citizens residing in these regions, as per the report.
The seven California and Texas counties are San Diego and Imperial Counties in California, and Cameron, El Paso, Hidalgo, Maverick, and Webb Counties in Texas are now subject to this financial monitoring, reported Reason.
The new rule requires financial institutions in certain border counties of the US to report cash transactions of $200 or more.
What does a CTR include?
CTRs require personal information like Social Security numbers and details of the cash transaction.
New Rule Puts Cash Transactions Under Federal Surveillance
A new regulation that took effect this week mandates reporting to financial institutions in seven border counties all cash deposits and withdrawals of $200 or more, a significant decrease of the reporting threshold of $10,000 which is followed in the rest of the country, Reason reported.The regulation, designed to help fight money laundering and cut the operations of Mexico-based drug cartels, could end up expanding government surveillance of its citizens residing in these regions, as per the report.
The seven California and Texas counties are San Diego and Imperial Counties in California, and Cameron, El Paso, Hidalgo, Maverick, and Webb Counties in Texas are now subject to this financial monitoring, reported Reason.
How Does This Change Affect Everyday Transactions?
Under the new regulation, companies such as check-cashing outlets and money exchanges in these counties are required to report Currency Transaction Reports (CTRs) with FinCEN whenever a cash transaction reaches the $200 threshold, as per the report. This is a cut from the current threshold of $10,000, which has been maintained since 1972, reported Reason. As per federal law, any cash transaction of $10,000 or more necessitates individual information like a Social Security number, which is documented and forwarded to the government for examination, according to the report.Concerns Over Privacy
This action has been criticized by privacy groups. Nicholas Anthony, a Cato Institute policy analyst, warns that this new regulation will expose more than a million Americans to financial monitoring, as per the report. He claimed, "Financial surveillance in the United States has long needed reform, but this move is in the wrong direction," as quoted by Reason.Why the New Rule Was Introduced?
The new regulation is part of the Trump administration's relentless pursuit to suppress drug cartels and criminality in the region, according to the report. Secretary of the Treasury, Scott Bessent, emphasized that the new regulation "underscores our deep concern with the significant risk to the U.S. financial system of the cartels, drug traffickers, and other criminal actors along the Southwest border," as quoted by Reason.FAQs
What is the new rule implemented by FinCEN?The new rule requires financial institutions in certain border counties of the US to report cash transactions of $200 or more.
What does a CTR include?
CTRs require personal information like Social Security numbers and details of the cash transaction.
Disclaimer Statement: This content is authored by a 3rd party. The views expressed here are that of the respective authors/ entities and do not represent the views of Economic Times (ET). ET does not guarantee, vouch for or endorse any of its contents nor is responsible for them in any manner whatsoever. Please take all steps necessary to ascertain that any information and content provided is correct, updated, and verified. ET hereby disclaims any and all warranties, express or implied, relating to the report and any content therein.
