FinCEN Advisory on Risks of Unlawful Employment of Illegal Aliens in the U.S.
The U.S. Department of the Treasury's Financial Crimes Enforcement Network (FinCEN) has issued an Advisory urging financial institutions to be cautious of the risks associated with the unlawful employment of illegal aliens. This effort is part of the administration's commitment to securing the nation's borders and financial system. Employers who hire and exploit non-work authorized populations can gain unfair advantages, depress wages, facilitate identity theft, and evade taxes, leading to significant financial losses for the government and taxpayers. The Advisory highlights the potential links between unlawfully obtained wages and the financing of criminal organizations engaged in illicit activities such as drug trafficking and human trafficking.
The Advisory, issued in collaboration with other regulatory bodies, supports Executive Order 14406 and aims to prevent the exploitation of the U.S. financial system by illegal aliens. It emphasizes the role of identity theft and payroll fraud in schemes by complicit employers in various industries to conceal violations of immigration laws. Financial institutions are encouraged to consider using an Individual Taxpayer Identification Number (ITIN) as a risk factor in customer due diligence processes when dealing with individuals presenting ITINs instead of Social Security numbers or valid employment authorization documents.
To help financial institutions detect and report suspicious activities related to fraud schemes involving the unlawful employment of illegal aliens, the Advisory includes 18 red flag indicators. Financial institutions are requested to use a specific key term in their Suspicious Activity Reports to indicate a connection to the activities highlighted in the Advisory. Additionally, FinCEN urges the public to report any tips or complaints about employers knowingly employing unauthorized workers to Immigration and Customs Enforcement.
FinCEN's Advisory Program aims to communicate money laundering and illicit finance threats to the financial system, enabling financial institutions to enhance their anti-money laundering and counter-terrorist financing programs. The program has been instrumental in generating valuable Suspicious Activity Reports that aid law enforcement agencies in uncovering and disrupting criminal activities. FinCEN also operates a whistleblower program to encourage reporting on violations of financial laws, offering rewards for actionable information that leads to successful enforcement actions. Individuals with relevant information are encouraged to submit whistleblower tips to FinCEN.