1. Geographic Targeting Orders (GTOs)
June 20, 2016, by Gabriele Masetti, Updated July 27th
2016
1. Legal basis
The Director of the Financial Crimes Enforcement Network (FinCEN) of the U.S. Department of the
Treasury is authorized to issue Geographic Targeting Orders (GTOs) imposing additional reporting
and recordkeeping on domestic financial institutions or nonfinancial trades and businesses in a
geographicareainfurtherance of the provisions of the Bank Secrecy Act (BSA).1
A GTO must contain
the precise geographic area that it is to be applied and have a maximum duration of 180 days,
although it can be renewed if the circumstances justifying it are deemed to be persisting.
Normally, the provisions for reporting, within 30 days and via IRS Form 8300, a cash transaction (or
multiple relatedtransactions) apply to operations in excess of $ 10,000. Under a GTO, however, this
threshold can be lowered for certain business and certain transactions.
2. The Bank Secrecy Act
The BSA is the primary U.S. anti-money laundering (AML) law and tool for detecting, deterring and
disrupting terrorist financing networks. The BSA authorizes the Secretary of the Treasury to issue
regulationsrequiringbanks and other financial institutions to take a number of precautions against
financial crime, including the establishment of anti-money laundering programs and the filing of
reports that have been determined to have a high degree of usefulness in criminal, tax, and
regulatoryinvestigationsandproceedings, and certain intelligence and counter-terrorism matters.2
3. Recent Geographic Targeting Orders
GTOs have been employed recently in:
 Los Angeles,California,Southof East8th
, Northof East 16th
Streetand betweenSantee Streetand
South Central Avenue; from October 9, 2014 to April 6, 2015; affecting garment and textile
stores, transportationcompanies,travel agencies,perfume stores,electronicstores,shoe stores,
lingerie stores, flower/silk flower stores, beauty supply stores, and Import/Export stores;
applying to all currency transaction in excess of $3,000.3
1 See Code of Federal Regulations (CFR), Title 31, Subtitle B, Chapter X, Part 1010, Subpart C, Section1010.370;U.S. Code Title
31, Subtitle IV, Chapter 53, Subchapter II, Section 5326;and TreasuryOrder 180-01.
2 AmericanLandTitleAssociation, Fact Sheet for Financial CrimesEnforcement NetworkGeographic targeting Orders for
Manhattan, N.Y., andMiami-Dade County, Fla.,at
http://alta.org/fincen/fact_sheet_for_financial_crimes_enforcement_network_geographic_targeting_orders.pdf.
3 U.S. Department of the Tresury, FinCEN, Geographic Targeting Order, September 26, 2014, at
https://www.fincen.gov/news_room/nr/pdf/LA_GTO_Order9-25-14.pdf

2.  Certain areas near Miami, Florida, corresponding to U.S. zip codes 33172, 33178, 33166, 33122
and 33126; from April 28, 2015 to October 25, 2015; affecting certain specified electronics
exporting businesses; applying to all currency transaction in excess of $3,000.4
 Borough of Manhattan, New York City, New York; from March 1, 2016 to August 27, 2016;
affectingcertainU.S.title insurance companies to report any legal entity purchasing residential
real property for a total purchase price in excess of $ 3,000,000 without a bank loan or other
similar form of external financing; involving, at least in part, currency, a cashier’s check, a
certified check, a traveler’s check or a money order of any form.5
 Miami-Dade County, Florida; from March 1, 2016 to August 27, 2016; affecting certain U.S. title
insurance companies to report any legal entity purchasing residential real property for a total
purchase price in excess of $ 1,000,000 without a bank loan or other similar form of external
financing; involving, at least in part, currency, a cashier’s check, a certified check, a traveler’s
check or a money order of any form.6
 Bexar County, Texas; from August 28, 2016 to February 23, 2017; affecting title insurance
companies to report any legal entity purchasing residential real property for a total purchase
price in excess of $ 500,000 without a bank loan or other similar form of external financing;
involving, at least in part, currency, a cashier’s check, a certified check, a traveler’s check or a
money order of any form.7
 Miami-Dade, Broward, and Palm Beach Counties, Florida; from August 28, 2016 to February 23,
2017; affecting title insurance companies to report any legal entity purchasing residential real
property for a total purchase price in excess of $ 1,000,000 without a bank loan or other similar
formof external financing;involving,atleastinpart, currency, a cashier’scheck,acertifiedcheck,
a traveler’s check or a money order of any form.8
 Borough of Brooklyn, Queens, Bronx, or Staten Island in New York City, New York; from August
28, 2016 to February 23, 2017; affecting title insurance companies to report any legal entity
purchasingresidential real property for a total purchase price in excess of $1, 500,000 without a
bank loan or other similar form of external financing; involving, at least in part, currency, a
cashier’s check, a certified check, a traveler’s check or a money order of any form.9
 San Diego, Los Angeles, San Francisco, San Mateo, or Santa Clara Counties, California; from
August 28, 2016 to February 23. 2017;affecting title insurance companies to report any legal
entity purchasing residential real property for a total purchase price in excess of $ 2,000,000
without a bank loan or other similar form of external financing; involving, at least in part,
currency, a cashier’s check, a certified check, a traveler’s check or a money order of any form.10
4 U.S. Department of the Treasury, FinCEN, Geographic Targeting Order, April 15 2015, at
https://www.fincen.gov/news_room/nr/pdf/GTO_Miami.pdf.
5 U.S. Department of the Tresury, FinCEN, Geographic Targeting Order, January13, 2016, at
https://www.fincen.gov/news_room/nr/files/Real_Estate_GTO-NYC.pdf.
6 U.S. Department of the Treasury, FinCEN, Geographic Targeting Order, January13, 2016, at
https://www.fincen.gov/news_room/nr/files/Real_Estate_GTO-MIA.pdf.
7 U.S. Department of the Treasury, FinCEN, Press Release, July27, 2016, at
https://www.fincen.gov/news_room/nr/pdf/20160727.pdf.
8 Ibid.
9 Ibid.
10 Ibid.

3.  Boroughof Manhattan inNewYork City,New York; affectingtitle insurance companies to report
any legal entity purchasing residential real property for a total purchase price in excess of $
3,000,000 without a bank loan or other similar form of external financing; involving, at least in
part, currency, a cashier’s check, a certified check, a traveler’s check or a money order of any
form. 11
4. History and Impact
Before the instances described above, GTOs had been implemented four times: (1) in Phoenix,
Arizona in 1989; (2) in Houston, Texas in 1991; (3) in New York in 1996/97 to target remittances to
Colombia;and(4) in New York and Puerto Rico in 1997/1998 to target remittances to the Dominican
Republic.12
The GTO in New York of 1996/97 applied to 23 money services businesses (MSBs) and roughly 3200
of their agents, mandating them to report identifying information on all cash remittances to
Colombiainexcessof $750. The implementationof the GTO’sprovisionsledtoamarkedreductionin
the volume of suspecteddrug-relatedfundsflowingviathe moneyremittance providerstoColombia,
and resulted in numerous cash seizures to ports and airports along the eastern seaboard, as
traffickersunsuccessfullytriedcompensatedfortheirinabilitytoexploitthe MSBs.13
The Department
of State estimated that, due to the implementation of the GTO, the volume of the business of
servicestransmitters toColombiadroppedbyapproximately30 per cent, even among those outside
of the area targeted, suggesting an high degree of centralization and control by high-level illicit
moneybrokers.Additionally,asignificant portion of specifically targeted transmitters turned out to
be front and were driven out of business or outright disappeared without trace.14
Finally, the cash
seizuresbylawenforcementagenciesduringthe period of the GTO were four times higher than the
average of prior years.15
This example serves to highlight two important features of GTOs: (1) they have the capacity of
providingavast amountof actionable financialintelligence; and (2) help enforcing the provisions of
the BSA,by inserting high levels of uncertainty and risk into the cost-benefit calculations of money
launderers.16
Italsoserves tohighlighttwoadditionalimportant issues: (1) GTOs tend to specifically
target the weak link in the complex, nuanced and adaptable network of transnational money
launderingenterprises,thatisthe movementof cashat critical choke points,suchas the entry points
to the international financial system; and (2) they are not only an occasion of a posteriori collection
of freshintelligence and law enforcement actions, but requires a priori intelligence, investigations
11 Ibid.
12 Roger C. Molander, DavidA. Mussington, Peter A. Wilson, Cyberpayments and Money Laundering: Problems and Promise,
RAND, 1998, pp 9-10.
13 Ibid.
14 U.S. Department of State, 1997 International Narcotics Control StrategyReport, March1998.
15 Idib.
16 Roger C. Molander, DavidA. Mussington, Peter A. Wilson, Cyberpayments and Money Laundering: Problems and Promise,
RAND, 1998, pp 9-10.

4. and analysistodeterminethe exact location and key actors that need to become the specific object
of a GTO.
5. Recent developments
In March 2012, and again in August 2014, FinCEN issued notices of proposed rulemaking seeking to
addresstransparencyconcernsoverbeneficialownershipof legal entities establishing new accounts
at financial institutions.The proposedmeasureswould require banks, brokers/dealers in securities,
mutual funds,futurescommissionsand commodities merchants, to identify and verify the ultimate
natural persons owning or controlling all legal entities to be established.
On May 5, 2016, the Secretary of the Treasury Lew sent a letter to the congressional leadership
providing an update of the recent actions taken by his Department, and advocate new statutory
authorities to tackle tax evasion, money laundering and other forms of illicit financial activities.17
Proposedmeasures are designedtopreventcriminals from using companies to hide their identities
to launder criminal proceeds, and to prevent foreign persons to hide assets in U.S. accounts via
single-member, foreign-owned limited liability companies. 18
The proposed legislation would also
amend the GTOs to extend their validity to wire transfers and all forms of currency transactions.19
In conclusion, SecretaryLew alsorequested Congressional assistance to pass appropriate beneficial
ownership legislation, approve bilateral tax treaties, and full reciprocity with foreign jurisdictions
under the Foreign Account Tax Compliance Act of 2010.20
6. Elements of congressional concern
FinCEN planson utilizingthe recent round of GTOs in New York, Los Angeles and Florida as a testing
ground for the efficacy of the measure, and to highlight areas of potential shortcomings requiring
reform. The question remains, however, whether the aggregation and analysis of the ensuing data
will result in a positive overall evaluation and therefore a wider recourse to GTOs, or in a major
overhauling of the instrument under a different framework.
But GTOs greatest strength might also be its largest weakness. Given the nature of GTOs –
dependence ongoodpreventive intelligence,local scope andtemporaryduration –they mightnotbe
suitable forgeneral andpermanentimplementation at the national level. Even a money laundering
ring that is greatly disrupted as a result of a successful GTO might, given time and opportunity, be
reconstituted - inthe same locationata latertime or,concurrently, elsewhere outsideof the reachof
17 Letter from Secretaryof the Treasury JacobJ. Lew to Congressional leaders, May5, 2016, at https://www.treasury.gov/press-
center/press-releases/Documents/Lew%20to%20Ryan%20on%20CDD.PDF.
18 U.S. Department of the Treasury, Proposedlegislation onAmendingthe BankSecrecyAct to Require Reporting and
Recordkeeping onBeneficialOwnershipof Legal Entities, at https://www.treasury.gov/press-center/press-
releases/Documents/20160506%20BO%20Legislation.pdf.
19 Ibid, see also Department of the TreasuryPress Release, TreasuryAnnounces KeyRegulations andLegislation to Counter
MoneyLaundering and Corruption, Combat Tax Evasion, May5, 2016, at https://www.treasury.gov/press-center/press-
releases/Pages/jl0451.aspx.
20 Letter from Secretaryof the TreasuryJacobJ. Lew to Congressional leaders, May5, 2016, at https://www.treasury.gov/press-
center/press-releases/Documents/Lew%20to%20Ryan%20on%20CDD.PDF.

5. a GTO. The transnational nature and increased mobility of contemporary criminal and terrorist
networks,togetherwiththe force multiplier offered by the next generation of technologies, might
not be efficientlytackled underthe currentGTO frameworkandmightconstitute anareaof potential
future congressional legislative focus.