This Week in AML

Will There Be a Domestic Terrorism Statute?

This week, Executive Vice President John Byrne, and Creative Director Elliot Berman of the AML RightSource staff talk about hearings being held in the House of Representatives about various proposals to make domestic terrorism a federal crime. John and Elliot discuss the views expressed by several witnesses at the hearings and what the financial crimes compliance community can do now to help detect and report potential domestic terrorist activity.


Will There Be a Domestic Terrorism Statute? [Transcript]

Elliot Berman: Hi, John, how are you this week?

John Byrne: I'm good. Elliot, how are you doing?

Elliot Berman: I'm okay, thanks. So this week I thought it might be worth talking about the hearings going on in front of the house financial services committee about, domestic terrorism. And I wondered if you had a chance to take a quick peak at the hearing, some of the testimony I think occurred this morning and there's been stuff going on all week.

Did you get a chance to look at that?

John Byrne: Yeah. I was actually able to watch part of it and it's the subcommittee on national security, international development of monetary policy. There's actually at least four pieces of legislation that they sort of couch as relevant. One is on the study of domestic terrorism, financing, FinCEN exchange, freezing of assets of suspected terrorists and fraud and terrorism education act.

So there were five witnesses. I did hear all the opening statements of the witnesses, not all the Q and A, but what I thought was clear was two things; there is a lot of pushback about actually creating a title 18 domestic terrorism statute, the feeling by some is that could result in some discriminatory or biased attacks toward other groups.

And then there were some recommendations, which I know we'll chat about in the second, about what you could do today, perhaps without changing the statute.

Elliot Berman: Yes. And I think one of the groups also pointed out that there are plenty of statutes on the books today that in the end cover a lot of what domestic terrorists do along the way to trying to commit a terrorist act.

So if you're effective in using those statutes and the investigators and prosecutors are that [effective] it's not as if we're leaving ourselves naked.

John Byrne: Right. And it was two things I would highlight; one of the witnesses, sort of talked about some of the tools that are getting used today to enable these actions, crowdfunding, recommended that the tech firms do better in their oversight of what they're allowing on, on their, on their sites, more transparency, and funding for research in this space. They did reject the notion of a domestic terrorism statute, as I mentioned.

[point number 2] and then improve data collection. So that was [more of] “let's figure out, get more information so we can make a more informed decision”.

And then, [there was] a former podcast guest, Danny Glaser, who's now at K2 integrity, but was the assistant secretary of the terrorist financing of the treasury and the Obama administration. Danny talked about a number of things that will seem very, both logical and practical to our audience. He did weigh in completely on changing the statute, but he said, create more topologies, use sanctions against some of these organizations and individuals - which is obviously a very good tool and make them very targeted, have FinCEN do more guidance - it has done a great job of providing guidance for financial institutions, improve information sharing, and use tools that they already have in their toolkit - like geographic targeting orders and that sort of thing. So I thought those were all valuable recommendations and, I'm still not completely convinced that we don't need a title 18 statute, [and] would want to hear more from our law enforcement partners, but I thought today's hearing sort of elevated the debate to real policy questions, which I think has been lacking.

Elliot Berman: I agree. I also took a look at Glaser's toolbox list and I thought, “you know, it's the kinds of things that a really active and effective financial crimes compliance community can take advantage of to build out whether or not a statute gets passed. And, you know, even if one does the things on his list, [there] are all the kinds of things you're going to do underneath it, with it or without it.

So, the community has been excellent at facing new challenges - some of them forced by ugly events, others by just taking up the charge, like really digging into human trafficking and things like that.

I think it's very important for these policy conversations to happen. It's part of really the most effective way government operates. But again, on the private side, we can be doing a lot, while those policy conversations are happening.

John Byrne: Yeah. And another witness actually referenced something to Glazer’s reference, and that's for perhaps 314a - which has been a strong tool since the Patriot act, could be utilized potentially (has to be amended), to include information sharing in this space.

That same witness, talked about something that Dennis Lormel always mentioned, and that is trying to figure out the organizational structure of these violent groups. This witness said that he thinks there's a tendency to think of these groups as disorganized, and non-hierarchical - and Dennis says, “nah, sometimes they are pretty organized”. So figuring that out could better help you, especially in the digital age we're in, in trying to do a better job of mapping out the financial activities of these groups.

So again, some really good debate and discussion today. I'm sure the Senate's going to cover this as well, going forward, but we'll track this for everybody, and keep you posted.

Elliot Berman: Absolutely. Well, thanks John. You have a good weekend and I'll talk to you next week.

John Byrne: All right. Stay safe. See ya.

Elliot Berman: You too. Bye bye.