WASHINGTON, DC - IRS Criminal Investigation, the IRS's investigatory arm, announced a new initiative to improve its work with financial institutions, the Associated Press reports. Financial crime has evolved due to improvements in technology and artificial intelligence (AI).
The program, Feedback in Response to Strategic Threat (CI-FIRST), was unveiled on Friday. It is designed to accelerate subpoena requests, provide banks with better data on the detection of criminal activity, and develop investigations faster and more efficiently.
The Bank Secrecy Act mandates that banks and other financial institutions submit several suspicious activity reports to the federal government upon detecting suspected money laundering or terrorist financing cases.
The new program will assist financial institutions in detecting financial crimes related to fentanyl trafficking, drug trafficking, human smuggling, and other offenses by streamlining subpoena requests and enhancing data-sharing with banks. Guy Ficco, the Chief of IRS-CI, stated that “public-private partnerships thrive when all parties mutually benefit.”
That same day, IRS-CI released new statistics showing how the agency has investigated financial crimes using data obtained from the Bank Secrecy Act.
For instance, the agency identified $21.1 billion in fraud related to tax and financial crimes from 2022 to 2024, seized $8.2 billion in assets associated with criminal activity during the same period, and recouped $1.4 billion in restitution for crime victims, according to IRS-CI.
“Behind all of these metrics are real crimes with real victims,” said Lauren Kohr, IRS-CI’s strategic engagement adviser. “A lot of times people look at BSA data or Bank Secrecy Act as a regulatory requirement, but it’s really one of the sharpest tools law enforcement as a whole has to trace fraud, illicit money and dismantle these criminal networks.”
“And when illicit money moves, it’s these BSA reports that tell us the story,” she said.
Agents attached to IRS-CI ran an average of approximately 966,900 searches annually against currency transaction reports (CTR). A CTR is a financial document that banks are required to file with the Department of the Treasury for any cash transaction exceeding $10,000 in a single day.
Over the past three years, approximately 67% of the cases opened by IRS-CI involved one or more currency transaction reports below $40,000, with half of currency transaction reports involving amounts under $22,230.
Republican lawmakers are trying to raise the threshold despite most reports coming in under $40,000.
Rep. Barry Loudermilk (R-GA) and nine co-sponsors have proposed the Financial Reporting Threshold Modernization Act, which would raise the current transaction reporting and Suspicious Activity Reporting thresholds to $30,000 and $10,000, respectively, while indexing the CTR threshold to inflation every five years.
A hearing is scheduled for April 1 before the House Financial Services Subcommittee on National Security, Illicit Finance, and International Financial Institutions, and the issue of thresholds is expected to be raised.
A Government Accountability Office (GA) report recommended last December that the Treasury Department help “reduce the number of CTRs filed that are not used by law enforcement, including raising the reporting threshold or expanding criteria to provide further exemptions.
The Trump administration has also used IRS-CI to assist with immigration enforcement.
In February, Homeland Security Secretary Kristi Noem requested Secretary Scott Bessent to borrow IRS-CI workers to help with the immigration crackdown, according to a letter obtained by the AP. The letter cited the boost in funding received by the IRS through the Inflation Reduction Act, which totaled some $80 billion. Some of that money, however, has already been taken back.
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