Key Takeaway:
- FinCEN will require money services businesses on the southwest U.S. border to file Currency Transaction Reports for cash transactions of $200 or more.
Introduction
On March 11, 2025, the Financial Crimes Enforcement Network (FinCEN) issued a Geographic Targeting Order (GTO) specifically aimed at combatting Mexico-based cartels and other criminals along the southwest border of the United States. The GTO will be effective beginning 30 days after its publication in the Federal Register and for the following 179 days, unless and until it is renewed.
Background
Ordinarily, covered financial institutions must file a Currency Transaction Report (CTR) for cash transactions above $10,000. Through a GTO, FinCEN can both lower this threshold and/or extend the reporting requirement to certain non-financial institutions. FinCEN has historically and frequently used GTOs to require title insurance companies to report information on certain all-cash transactions for real estate purchases, but has also imposed reporting requirements on trades and business within a certain area, such as the Los Angeles Fashion District, Miami-based electronics exporters, and armored car services in certain California ports.
The New GTO
Per this new GTO, all money services businesses (MSBs) located in 30 specific ZIP codes across the border regions of California and Texas must file CTRs with FinCEN for cash transactions between $200 and $10,000 and maintain records of these reports. Note, although the GTO is specific to this range of funds, the standard CTR requirement for MSBs to file reports on cash transactions of $10,000 or above remains in effect. The ZIP codes cover MSBs in the border counties of Imperial, San Diego, and Cameron in California, and El Paso, Hidalgo, Maverick, and Webb in Texas.
The MSBs must also identify and verify the identities of the people presenting these transactions. This requires collecting the names and addresses of the individuals presenting the transactions, along with the identities, account numbers, and tax identification numbers of any persons or entities on whose behalf the transactions are effected (if applicable). Verification may be conducted by submitting documents normally accepted in the banking community, such as a driver’s license or, for a foreign individual, a passport. 31 CFR 1010.312.
In connection with the GTO, FinCEN also encourages MSBs to file Suspicious Activity Reports, as appropriate, to report transactions designed to evade the new $200 reporting threshold.
The Bigger Picture
The current administration has made the “total elimination” of cartels and transnational criminal organizations (TCOs) a top national security priority. Indeed, in a Day One executive order, President Trump created a process by which to designate certain cartels as Foreign Terrorist Organizations (FTOs) and Specially Designated Global Terrorists (SDGTs). Attorney General Pam Bondi issued a memorandum on February 5, 2025 directing the Department of Justice to prioritize enforcement efforts and coordination with other “parts of the government” toward the “goal of eliminating” threats posed by cartels and TCOs. Following the executive order, on February 20, 2025, the State Department named eight international cartels as FTOs and SDGTs in a move that restricts these groups’ access to the U.S. financial system.
In issuing the GTO, the U.S. Treasury Secretary reaffirmed the administration’s focus, emphasizing a “whole of government approach” to combatting illicit financial activity. The GTO may be only the first step that FinCEN takes to further the U.S. government’s agenda to combat cartels.
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