FinCEN Reissues Southwest Border GTO Imposing Enhanced Currency Reporting on MSBs

Key Takeaways

• FinCEN has reissued a Geographic Targeting Order requiring covered money services businesses in designated ZIP codes in New Mexico and Texas to file Currency Transaction Reports on cash transactions between USD $1,000 and USD $10,000.
• The order is effective for 180 days after Federal Register publication.
• Compliance teams at affected MSBs, and at banks that serve them, should confirm scope, adjust reporting processes, and reassess risk exposure.

Deep Dive

The reissued GTO lowers the standard Currency Transaction Report (CTR) threshold for covered MSBs. Ordinarily, CTRs are required for cash transactions above USD $10,000. Under this order, MSBs must file CTRs on cash transactions from USD $1,000 to USD $10,000 in specified ZIP codes. The geographic scope covers Bernalillo, Dona Ana, and San Juan counties in New Mexico, and Cameron, El Paso, Hidalgo, Maverick, and Webb counties in Texas. The order is aimed at Mexico-based cartels and related money laundering, and FinCEN states it will help investigators develop leads and scrutinize cash activity along the border.

The key timeline is the 180-day effective period, which begins on Federal Register publication. The press release does not give the publication date, so compliance teams should monitor the Federal Register and review the full GTO text for exact ZIP code coverage, definitions of covered businesses, record-keeping obligations, and any exceptions. Because this is a reissuance, entities that complied with prior orders should not assume the terms are identical. They should compare the new order against previous versions, since the ZIP code list, thresholds, or other conditions may differ.

Recommended actions for covered MSBs include: confirming whether any locations or agents fall within the listed ZIP codes; updating transaction monitoring rules and CTR workflows to capture the lower threshold; training front-line staff and agents on identification and reporting requirements; and testing filing accuracy and timeliness. Compliance teams should also consider whether agent networks need contractual or procedural updates. Banks that maintain accounts for MSBs in these areas should anticipate higher reporting volumes and may need to refine due diligence and monitoring of those relationships.

The risk implications are mainly regulatory and operational. Failure to file accurately or on time can lead to Bank Secrecy Act enforcement exposure. A higher volume of CTRs may strain resources and increase data quality risk. Compliance teams should also watch for structuring behavior, such as customers splitting transactions to stay below USD $1,000, and should escalate suspicious activity through SAR processes where warranted. Customers may shift activity to non-covered locations, so institutions outside the border area should remain alert to displacement risk.

Source: Financial Crimes Enforcement Network