House Financial Services Committee Chairman Barney Frank raised concerns Tuesday on a recent wire-transfer proposal and said he would convene a hearing on the plan's costs.
In a letter to Financial Crimes Enforcement Network Director James Freis, Frank wrote that the agency's proposal may be burdensome to banks and could threaten individuals' privacy.
"Enacting this policy will further increase bank costs, require personnel education and will increase their potential liabilities," Frank wrote on Tuesday. "The need to better identify and track flows of terrorist funds is clear. I am not persuaded that such a broad-scale policy change is the best way to achieve that goal."
Frank said Fincen is already taxed in its ability to analyze existing anti-laundering reports by banks. At a minimum, he said, Fincen should wait until it is finished redesigning its information technology platform before seeking further reporting.
The proposal would require banks that directly transfer or receive foreign wire transfers to report them to Fincen. But Frank said this raises privacy concerns.
"Transfers that have no connection whatsoever to any criminal activity will be affected by this wire transfer initiative, and there is no great likelihood that such data will be useful," he wrote. "Such intrusions can only be justified by a showing that the data serves an essential purpose."
