Jim Sloan works from a remarkably unimposing office in an ordinary commercial building in a Washington suburb more famous for its giant shopping centres than for its low key centre of operations of various US Government intelligence operations. The car park has none of the big "trucks" that populate the multi-lane roads that congeal at various times of the day. Access to his organisation's office is past a manned security post no different from those in many offices and the staff are, for the most part, dressed in ordinary chain store clothes.

It is clear that this is an organisation that does not waste money on plush accommodation. The office furniture is pretty much what you would find in an ordinary commercial office - not one that sets out to impress with how much it can afford to spend on furnishings. The reception area is simply furnished with sofas. On the walls of the offices there are blown up copies of the currency of many nations - in compliance with a long-standing FinCEN tradition that field officers return from their travels with banknotes that can be enlarged and framed.

It is to the one personal photo on his wall that Jim Sloan drew WMLR's attention when we met: it is an interesting metaphor - and one that, initially, one suspects the quiet Mr Sloan may not have noticed: the picture he has chosen to represent himself to the world is of him wearing a hard hat and sitting at the top of a pole. The pole in question is a telegraph pole and it demonstrates how far this quietly spoken native of Massachusetts has come since starting work in a telephone company. He moved to law enforcement in Boston, New England and then onto the US Secret Service, where he worked in financial crime investigations in, amongst other places, New York. He arrived as Director of FinCEN in April 1999. Many see it as a poison chalice.

FinCEN was having a hard time - its former director, Stanley Morris, had left and all was not sweetness and light. There were dark rumblings about high profile projects, particularly in technology, not making the claimed progress and that far too much time and money was being spent on foreign trips for which little tangible benefit could be identified. One press report highlighted what it saw as Morris' excesses and was a rare piece of general press comment on FinCEN. But it stung the organisation that maintains a low profile but considerable influence.

Sloan is conscious of the budget problems. FinCEN is a department within the Customs section of the US Treasury. His staff are also aware of the fact that budgets are as much argued for in the press as in Government meetings. The biggest problem - in profile terms - faced by FinCEN is that it is not an investigation agency, per se. And so when the press office presents a press pack detailing FinCEN successes, it makes no mention of the involvement in the BCCI investigation that saw FinCEN staff in London and other places for periods of months at a time and focuses on the success in identifying the laundering scheme involving Mexican Pesos and products - but this story is old. The press pack contains copies of articles from Business Week (December 1997), The Economist (July 1997), The Wall Street Journal (31 December 1996, September 1998 and June 1999). The scheme was described in detail to the 15th Symposium on Economic Crime in Cambridge, England, in September 1997 - and no mention made of the contribution to the investigation made by FinCEN. In fact, it is only the WSJ report of the 31 December 1996 - possibly the worst day in the year to be featured in a good news story because that must be the least read (as distinct from seen) issue for any newspaper - that draws significant attention to the FinCEN involvement with its headline "Obscure Treasury Unit Helps DEA Uncover Money-Laundering Scheme": even then the paper got the acronym wrong - calling it "Fincen" instead of FinCEN - and was still getting it wrong in September 1998.

When one of the World's leading newspapers fails to get nomenclature right - even over a period of some two years, it is clear that the battle for public recognition, without which budget battles are made more difficult, is not being won. So, one of the first initiatives suggested by Jim Sloan was to raise the public profile of FinCEN with an occasional newsletter "SAR Bulletin". The first issue was published in June 1999 and was basically an open letter to operations managers in US banks, thrift institutions and credit unions. Claiming to represent information drawn from the Suspicious Activity Reporting System, the only article in the newsletter was to draw attention to the fact that the SARs had made reference to possible abuses of Automated Teller Machines in 982 reports over a period from July 1997 to mid-April 1999, and saying that ATMs were used to deposit or withdraw cash on a recurrent basis. The three methods reported are multiple deposits to same accounts at different locations, and multiple withdrawals from ATMs or banks; cheque cashing combined with ATM withdrawals and the use of overseas ATMs to withdraw funds from US bank accounts. The latter example represents about a third of the SARs which refer to ATMs and withdrawals are claimed to be "usually those having a high risk for money laundering or drug trafficking."

But the language of the article is bureaucratic and trite, the newsletter is only three pages long, of which only three quarters of a page is the substantive article and one page is taken up with a "feedback form". It is pointless, seen against the "FinCEN advisories" which are detailed and informative. Even though the FinCEN website was updated in late August 1999, no further edition of SAR Bulletin had appeared at the time of that update. Yet the latest FinCEN website, (http://www.treas.gov/fincen/) is a triumph - a well laid out, informative and easy to navigate website that focuses on what it needs to say and ignores all attempts to be "cool". All Governments should emulate this approach.

The style and substance of the SAR Bulletin does not fit with Jim Sloan the man, who is calm, approachable and confident, entirely devoid of brashness. His morning coffee sits on one corner of his desk in a paper cup. This is not egalitarianism for effect - it's just that coffee comes like that in America and it would be for effect were it to be decanted.

When Sloan walks into the shared ante-room outside his office, his staff do not stiffen or bristle; they do not immediately stop what they are doing and look to him expectantly; they do not fawn. But there is clearly respect for the 52 year old man who will lead this complex organisation into the next Century.

WMLR interviewed Jim Sloan in early August 1999, when he had been in post for just four months. FinCEN had been rudderless for several months after Morris' departure but Sloan took the mature view and has spent much of that time learning about the organisation, its strengths and weaknesses and finding out more about the purpose of it. It would have been easy - and probably dangerous - to make knee jerk reactions to what he found, but his first major staff meeting, at which he made clear to FinCEN's senior establishment was not until four months after his arrival, when he could speak with clarity and authority.

Internationally, FinCEN is seen as an FIU (Financial Intelligence Unit) but Sloan is quick to point out that this is only one of its functions. He is apparently more concerned with its function as a regulator. This is a telling issue because the activity as an FIU is largely unquantifiable - and in the competitive world of government funding, it is necessary to find ways of making money count towards recognisable results. However, this concern is, perhaps, an indication of a balancing act. Here we have the Chief Executive of an organisation struggling with the problem of market positioning.

FinCEN has four functions: Regulator, Enforcement Agency, International Networking and Co-operation and Technology. Its staffing split is interesting - and discloses the truth of the FinCEN function - to provide support to other agencies. Of its staff, 38% are in technical support, 48% are analysts and 13% are agents. The remaining 1% are administrative staff. FinCEN also provides a home for external agencies, through a facility called "Platform." 21 US government departments, ranging from the National Indian Gaming Commission, through the Internal Revenue Service to the Environmental Protection Agency have permanent representation, as does, for some reason, the UK Embassy. Platform is extended to provide off site support, known as "Gateway" to law enforcement agencies from all 50 US States, enabling them to access FinCEN information on-line so leveraging their expenditure and helping to prevent parallel investigations overlapping or even tripping over each other.

Administratively, FinCEN is directly responsible to the Assistant Secretary for Enforcement and through him to the Under Secretary for Enforcement and on to the Secretary to the Treasury. It is closely related to US Customs.

Sloan has to deal with a wide range of problems - morale is not high and the lack of certainty about the direction of the unit has led to some departures. The computer systems - the trumpeted Artificial Intelligence systems - which are claimed to provide detailed and accurate analysis of the data lodged with FinCEN do not fully function, at least not as effectively as the public has been led to believe. The software is based in a commercial application which FinCEN has "tweaked" but even thought there are demonstration programs, the results are patchy. But in the past, a large part of the FinCEN budget has been devoted to the development of the system. In addition, FinCEN is widely seen as the leader in the Egmont Group (an association of FIUs, with private access to shared information), even though Egmont is not a FinCEN project. But the Egmont computer system simply didn't work for much of August 1999 and FinCEN will, unfairly, get some of the blame.

There are other issues, too, such as the amount of time and money spent on delegations to the plethora of intergovernmental and quasi governmental organisations at which FinCEN has historically represented the USA. There is the FATF, the Caribbean FATF, The Asia Pacific Group, and others.

FinCEN has a lot to do: it receives an average of 5000 Suspicious Activity Reports a month. This is in addition to the currency transaction reports made by the 219,000 businesses that are required to file details of all transactions in cash or cash equivalents such as wire transfers, drafts, etc., for values in excess of US$10,000. These reports, made under the Bank Secrecy Act, have amounted to 39 million in the past fifteen years and are currently running at about 100,000 each year.

Even allowing for the failings in the computer systems, FinCEn manages to make a fair fist of analysing and reporting on the connections between items of information revealed by the filings.

The SAR form contains 70 items of information and a narrative. The US Paperwork Reduction Act requires Government forms to contain an estimate of the average time for completion of a form and in the case of the SAR, the estimate is 36 minutes. The Currency Transaction Report contains 99 pieces of information and is estimated to take 19 minutes to complete. These time estimates may give some idea of the likely time that FinCEN has to devote to data input. And of course, data input has to be accurate and where the information is revealed by narrative, the data input is less straightforward than in the case of a simple tick box or hard information, such as names and addresses. The computer system operates by cross-matching information in each form with each piece of information already on the system. The information on SARs is processed at the Detroit Computing Centre and the CTRs are processed at FinCEN. Cross matched information has resulted in some 3500 sets of information that have been used in investigations into money laundering and related offences.

There is a view within FinCEN that President Clinton gave a boost to the organisation with his 1995 speech to the United Nations when he indicated that he regarded money laundering prevention as a Defence of the Realm issue - but that must be seen against the background that Clinton and other politicians around the World have, since the breakdown of the Soviet Union and the reduction in international trouble, been calling the name of organised crime and money laundering in particular in the absence of any more easily identified threat. The problem with this view is that it takes no account of the dictates of fashion, and organised crime is a fashionable Aunt Sally. It is quite probable that there will be wavering commitment to the defeat of organised crime, depending upon the state of the opinion polls, and where the USA is in the electoral cycle. It costs nothing to declare war on criminals but it is expensive to wage it - and regardless of good intentions, in most countries, unless there is civil disobedience, domestic law and order comes a long way down the pecking order.

It is questions of compliance with the Bank Secrecy Act that are at the centre of the so called "Regulatory" function of FinCEN. It has no function in the sense of Financial Services Sector Regulation. That responsibility falls to the banking et al supervisory authorities. FinCEN's "regulatory" function is limited to requiring the creation and implementation of record keeping by the banks and others that are subject to the Bank Secrecy Act. FinCEN works with the financial services industry to establish the policies and regulations that aim to reduce the incidence of money laundering within the US financial system. But, FinCEN has no prosecution arm and has bark but no bite of its own. Sloan declares that there is no desire to develop a prosecuting function, but some of his own staff are less certain of the desirability of exercising a purely "back office" function in the law enforcement community.

FinCEN currently has about 200 members of staff and has about 40 "detailees" assigned to it from other agencies. These "detailees" are the participants in the Platform Programme. FinCEN provides office space and technology but the personnel are paid by - and remain responsible to - their own organisations.

In 1992, the US Federal Criminal Code required the establishment of "a team of experts to assist and provide training to foreign governments and to agencies thereof in developing and expanding their capabilities for investigating and prosecuting violations of money laundering and related laws." FinCEN performs this function and sends operations staff to a number of countries where they work with draftsmen, politicians and enforcement agencies in the preparation of laws and in methods of identification and prevention of money laundering. This assistance is provided without charge but it has a price - there is an inevitable tendency to encourage laws in the US model rather than in the European model. The problem is that such an approach can be criticised as an extension of US foreign policy, a sort of imperialism by stealth. This complaint may or may not be true, but the fact that it can be levelled means that there is more mud thrown in FinCEN's direction.

The trouble with mud is that it sticks. And FinCEN is not Teflon coated. Its image problem is one that troubles FinCEN insiders. Its PRs are defensive of it, in part, it is true, because of some badly prepared and sensationalist articles that have appeared and which have stung FinCEN. Indeed, WMLR was granted what was, at the time, almost unparalleled access to the Director.
The defensiveness of the PRs is perhaps misplaced: FinCEN has an image problem not because of how it does but because of what it does - or perhaps even because of what it does not do.

The face of law enforcement in the USA is largely defined by the policeman in his blousson, and by personnel from the plethora of enforcement agencies from the DEA to the FBI: seemingly anyone who can write three big letters on the back of a sweatshirt and run, crouched and shouting. Mention intelligence gathering and in many minds, thoughts turn to secret agents, undercover missions and pyrotechnics. The war against financial crime takes a different approach. Yes, there are raids on buildings, but in order to secure documents to add to the store of knowledge. And FinCEN has no authority - or people - to carry out such a raid.

The function of gathering and analysing information is not glamorous, it does not hit the television news every night, it is of no interest to broadcast news because its work is not telegenic, and it is of little interest to print media because there are no pictures to support the story - and because if there is a raid, and photos are taken, the photos are of another agency's personnel.

Jim Sloan recognises this and wants to make FinCEN the central hub of information gathering, analysis and distribution in the US enforcement community, at least so far as financial crime is concerned. It will, in his vision, become a sort of clearing house, a super-library, for all manner of information relating to money laundering and other financial crime including organised crime. The clever thing about this approach is that it means that, if he is successful, representatives of FinCEN will not have to appear before their paymasters begging for funds. The agencies that use the resources, and therefore do not have to dedicate their own funds to duplicating information management, and that become dependent on the continued existence and increasing effectiveness of FinCEN, will argue for it.

But against this is the risk of inter-agency rivalry. There is no compulsion on other agencies to feed information they hold into the central pot. Without it, there is a hole in the system, and hence the argument. So it is necessary to persuade all other agencies that disclosure of information is as necessary as plundering the information already stored. And it is necessary to address the shortcomings of the computer systems.

This objective represents a subtle description of what is actually a fundamental shift in direction for FinCEN. It is perhaps probable that FinCEN's director knew precisely the subliminal message of that photograph on his wall; he is at the top of a very slippery pole and before he achieves his objectives, he may very well need the hard hat.

James Sloan is interviewed in this issue of WMLR