Criminal Investigation Responds to Terrorism
IRS Criminal Investigation (CI) special agents have a combined accounting and law enforcement background. These collective skills make IRS special agents experts at following financial transactions, analyzing key pieces of detailed financial information and putting together an otherwise confusing, jigsaw-type puzzle of financial transactions that outline expenditures, life-style changes and acquisition of assets. Discovering where the money came from and where it went is what IRS special agents do best.
These unique skills enable them to analyze complex, often unusual, financial transactions, and are best utilized to combat terrorism involving:
- The leadership and members of extremist groups who have committed tax evasion, money laundering, or currency violations;
- Persons engaged in fundraising activities to support terrorism, especially if tax exempt organizations are being utilized;
- Terrorism investigations involving complex, extensive or convoluted financial transactions.
Since September 11, 2001, CI has played a prominent role in many investigations of individuals and organizations believed to be involved in or supporting international terrorist activities. Historically, IRS CI special agents have been engaged in a variety of activities including assisting the Federal Bureau of Investigation (FBI) by focusing on financial leads, conducting witness interviews, participating in “jump teams” sent to the Middle East, Europe, and the Caribbean to conduct financial investigations, and analyzing financial data.
Criminal Investigation's Role on Terrorism Task Forces
IRS Criminal Investigation (CI) has and continues to provide financial expertise and counterterrorism investigative assistance in task forces and activities that include:
Special Assignments in the Middle East: Special agents from IRS CI have utilized their unique skills as part of an interagency effort to trace and recover Iraqi assets, including both official assets of the former regime and illicit assets looted and held by or on behalf of Saddam Hussein, his associates, their families, front companies, etc. The financial investigative process for the assignment is very similar to the routine duties IRS CI special agents are trained to address including complex tax schemes and narcotics money laundering where nominees and layered transactions are conducted with artificial entities to hide and conceal money.
Coordination with the Federal Bureau of Investigation (FBI)
The National Joint Terrorism Task Force (NJTTF) was established in 2002 to manage the Joint Terrorism Task Force program which has been around since the 1980s. Originally located at FBI Headquarters, the NJTTF moved to the multi-agency NCTC, where it performs its mission while also working with NCTC personnel to exchange information, analyze data, and plan anti-terrorism strategies. The mission of the NJTTF consists of managing and supporting each JTTF by sharing intelligence and terrorism threat information; providing big picture terrorism analysis; offering guidance and oversight; setting sound program policies and supplying resources for manpower, equipment and space to facilitate training.
Joint Terrorism Task Force (JTTF): The Federal Bureau of Investigation’s JTTFs were created to strengthen efforts to combat terrorism by enhancing cooperation between federal, state and local law enforcement agencies throughout the country. Since its inception in 1980, there are now over 100 FBI JTTFs nationwide staffed with special agents and state/local law enforcement officers gathering evidence, following leads, collecting and sharing intelligence and responding to threats and incidents at a moment’s notice all in support of combating terrorist activities.
Terrorism Financing Operations Section (TFOS) is a specialized section in the FBI’s Counterterrorism Division. When terrorists raise, store, move and spend money they leave trails. These trails can be complex but they are traceable and identifiable through global financial systems. The mission of the agents and analysts at TFOS is to trace transactions and track patterns to assist in identifying, disrupting and prosecuting terrorists, their associates and their leaders as well as identify their assets.
National Domestic Terrorism Squad
The FBI is the lead domestic terrorism agency in the U.S., working to identify and prevent domestic terrorism acts before they occur and investigate them when they do take place. The FBI is also the lead federal agency in responding to a domestic terrorism crisis situation, functioning as the on-scene manager for the U.S. government. CI partners with FBI investigating individuals and groups which facilitate their activities through tax evasion and money laundering.
During the FBI’s investigations, they receive a great deal of investigative support from state, local, and federal partners including IRS Criminal Investigation. An example of this collaboration is the recent Nevada Joint Terrorism Task Force case that resulted in the arrest of four members of an anti-government group on federal money laundering, tax evasion, and weapons charges.
Coordination with the Treasury Department
As IRS CI is a Treasury Bureau, because of its unique law enforcement mission to follow the money, critical coordination with Main Treasury promotes a common strategy to fight terror finance.
The Office of Terrorism and Financial Intelligence (TFI) marshals the department's intelligence and enforcement functions with the twin aims of safeguarding the financial system against illicit use and combating rogue nations, terrorist facilitators, weapons of mass destruction (WMD) proliferators, money launderers, drug kingpins, and other national security threats.
Office of Terrorist Financing and Financial Crimes (TFFC): As the policy development and outreach office for TFI, the Office of Terrorist Financing and Financial Crimes (TFFC) works across all elements of the national security community – including the law enforcement, regulatory, policy, diplomatic and intelligence communities – and with the private sector and foreign governments to identify and address the threats presented by all forms of illicit finance to the international financial system.
TFFC advances this mission by developing initiatives and strategies to deploy the full range of financial authorities to combat money laundering, terrorist financing, WMD proliferation, and other criminal and illicit activities both at home and abroad. These include not only systemic initiatives to enhance the transparency of the international financial system, but also threat-specific strategies and initiatives to apply and implement targeted financial measures to the full range of national security threats. Primary examples of these roles in advancing this mission is TFFC’s leadership of the U.S. Government delegation to the Financial Action Task Force, which has developed leading global standards for combating money laundering and terrorist financing and its role in specific efforts to counter threats like proliferation, terrorism and the deceptive financial practices of Iran.
The Office of Foreign Assets Control (OFAC) of the US Department of the Treasury administers and enforces economic and trade sanctions based on US foreign policy and national security goals against targeted foreign countries and regimes, terrorists, international narcotics traffickers, those engaged in activities related to the proliferation of weapons of mass destruction, and other threats to the national security, foreign policy or economy of the United States. OFAC acts under Presidential national emergency powers, as well as authority granted by specific legislation, to impose controls on transactions and freeze assets under US jurisdiction. OFAC seeks input from Treasury enforcement agencies to identify terrorists and terrorist fundraising activities for inclusion in the Counterterrorism sanction program.
IRS-Criminal Investigation (CI) Internal Resources
CI Counterterrorism Lead Development Center (CT-LDC) was established to maximize IRS CI’s counterterrorism efforts nationwide through the efficient use of a central facility that conducts financial research and analysis to support ongoing investigations and identify terrorist financing activities. The CT-LDC uses advanced analytical technology and leverages valuable income tax data to support ongoing investigations, and proactively identify potential patterns and perpetrators with a particular focus on the use of tax exempt organizations to fund terrorist activities. The objectives of the CT-LDC are “to provide effective and efficient support to ongoing counterterrorism investigations; to identify emerging issues, trends, and patterns; to act as a deconfliction center for field investigations; to identify and forward leads through proactive research; and to liaison with the Joint Terrorism Task Forces (JTTF)”.
The CT-LDC’s primary responsibility is to provide support in all IRS terrorism investigations. The preferable flow of information is through IRS agents assigned to the JTTF. The CT-LDC will provide support to other law enforcement agencies, however, it is preferred that these requests flow through an IRS agent assigned to the JTTF. If the CT-LDC receives information of an imminent threat, this information will immediately be shared with a JTTF liaison, or any other agency that may be impacted. The CT-LDC receives information for research from a number of sources, including: IRS-CI Narcotics and Counterterrorism Section, Terrorist Financing Operations Section (TFOS), JTTFs, IRS-Tax Exempt and Government Entities Division and other civil components, and state and local law enforcement.
CI Computer Investigative Specialists (CIS) assistance to terrorist investigations. Today most financial records are stored on computers. CI’s Computer Investigative Specialists (CIS) are experts in extracting financial records stored in computer hard drives, computer networks, and even the Internet. CIS take part in every IRS criminal and counterterrorism investigation that involves the acquisition of digital evidence.
Other Unique Partnerships to Fight Terrorism
The Financial Action Task Force (FATF) is an inter-governmental body whose purpose is the development and promotion of national and international policies to combat money laundering and terrorist financing. The FATF is therefore a 'policy-making body' created in 1989 that works to generate the necessary political will to bring about legislative and regulatory reforms in these areas. The FATF consists of 33 countries, which includes the United States and 2 regional organizations. IRS is one of several participating agencies for the US.
Department of Justice - Anti Terrorism Advisory Council (ATAC) has the primary responsibilities to coordinate anti-terrorism initiatives, initiate training programs and facilitate information sharing. The ATAC are comprised of approximately 5,300 state and local law enforcement agencies that have joined with federal law enforcement organizations in the war on terrorism. The U.S. Attorneys serve in leadership roles as the head of each ATAC.
The ATAC ensures that federal, state, and local law enforcement efforts are focused and coordinated as they pursue targets who may be connected to terrorism. The ATAC works closely in partnership with the nation's JTTFs, who retain primary operational responsibility for terrorism investigations, while ATACs continue to take the lead where they are better equipped to manage particular projects. The ATACs mobilize and coordinate federal, state, and local officials for national prevention-based initiatives that involve significant prospects of imminent prosecution. They also provide a central forum for agencies to congregate and identify potential terrorism links among their investigations. In addition, the ATACs are responsible for initiating training programs and facilitating information sharing.