GTOs are issued by FinCEN, a bureau of the U.S. Department of the Treasury. GTOs impose heightened recordkeeping and reporting requirements upon certain financial institutions or nonfinancial trades or businesses in targeted geographic areas. The primary aim of the GTO is to facilitate law enforcement in combating financial crimes, including money laundering and terrorist financing, by making those types of transactions more transparent.

How Does Geographic Targeting Order Function?

GTOs are issued by FinCEN under the authority of the BSA. They do not require judicial approval but instead are based upon a determination by FinCEN that special requirements are necessary to deter criminal activity. GTOs are temporary in nature and typically remain in place for 180 days but may be extended or allowed to expire depending upon continuing assessments.

Current Geographic Areas Targeted by GTOs

The GTOs currently covered by FinCEN target specific counties and metropolitan areas in different states. As of April 21, 2023, FinCEN expanded the geographic coverage of the GTOs to include additional regions. The purchase price threshold is still $300,000 for each covered metropolitan area, except for the City and County of Baltimore, which stands at $50,000. Examples of the areas covered include:

Texas: Bexar, Tarrant, Dallas, Montgomery, Harris, and Webb Counties.

Florida: Miami-Dade, Broward, and Palm Beach Counties.

Maryland-Montgomery, Anne Arundel, Prince George’s, and Howard Counties; Baltimore City and County.

New York-The boroughs of Brooklyn, Queens, Bronx, Staten Island, and Manhattan.

California-San Diego, Los Angeles, San Francisco, San Mateo, and Santa Clara Counties.

Colorado-Adams, Arapahoe, Clear Creek, Denver, Douglas, Eagle, Elbert, El Paso, Fremont, Jefferson, Mesa, Pitkin, Pueblo, and Summit Counties.

Connecticut-Fairfield and Litchfield Counties.

District of Columbia-The entire district.

Hawaii: City and County of Honolulu, Maui, and Kauai.

Nevada: Clark County.

Virginia: Arlington and Fairfax Counties; the cities of Alexandria, Falls Church, and Fairfax.

Washington: King County.

Massachusetts: Suffolk and Middlesex Counties.

Illinois: Cook County.

The above-mentioned areas are targeted by FinCEN to require special attention in order to prevent illicit money-laundering activities.

How GTO is Relevant to Financial Institutions?

Financial institutions are prime targets for various types of fraud, money laundering, and cybercrimes. Geographic Targeting Orders play a significant role in safeguarding these entities by enabling targeted data access and monitoring.

Fraud Detection and Prevention: GTOs allow financial regulators and law enforcement to access transaction data within specific regions, aiding in the identification of fraudulent activities.

Compliance and Reporting: Banks and financial institutions must comply with GTOs by providing requested data promptly. This ensures they remain compliant with legal requirements and avoid penalties.

Cybersecurity Enhancements: With the rise of cyber threats, GTOs facilitate the monitoring of suspicious online activities targeting financial systems within specific geographies.

Risk Management: Access to geographically targeted data helps financial institutions assess and manage risks more effectively, ensuring the stability and security of their operations.

Collaboration with Authorities: Financial institutions often collaborate with law enforcement under GTOs, sharing critical data that can prevent or mitigate financial crimes.

Ensure transparency with stakeholders regarding shared data and compliance to instill confidence and meet regulatory expectations about BSA and FinCEN. By implementing GTO compliance into their practices, financial institutions enhance safety while helping to combat financial crimes and fulfilling BSA and FinCEN obligations.