The Business of Government Hour


About the show

The Business of Government Hour features a conversation about management with a government executive who is changing the way government does business. The executives discuss their careers and the management challenges facing their organizations. Past government executives include Administrators, Chief Financial Officers, Chief Information Officers, Chief Operating Officers, Commissioners, Controllers, Directors, and Undersecretaries.

The interviews

Join the IBM Center for a weekly conversation about management with a government executive who is changing the way government does business.

James Sloan interview

Friday, February 15th, 2002 - 20:00
"In the maritime arena, across the board, the Coast Guard is aligned with the mission and vision of the Department of Homeland Security, whether it's in search and rescue missions, the security of our borders, or in counter-narcotics."
Radio show date: 
Sat, 02/16/2002
Intro text: 
Sloan describes the Coast Guard's assimilation into DHS. Sloan also explains the Coast Guard's Maritime Strategy for Homeland Security. The Maritime Strategy focuses on three areas: prevention of terrorist attacks on the United States from the maritime...

Sloan describes the Coast Guard's assimilation into DHS. Sloan also explains the Coast Guard's Maritime Strategy for Homeland Security. The Maritime Strategy focuses on three areas: prevention of terrorist attacks on the United States from the maritime domain, assessment of threats and reduction of vulnerabilities, and preparation for response in the event of an attack. Sloan then explains the "Federated DHS Intelligence Enterprise," which is the system established for intelligence sharing among DHS and various law-enforcement organizations. Lastly, Sloan shares insight into how the Coast Guard keeps up with new surveillance and investigation technology. Missions and Programs; Collaboration: Networks and Partnerships; Strategic Thinking

Complete transcript: 

Arlington, Virginia

Thursday December 13, 2001

MR. LAWRENCE: Welcome to The Business of Government Hour. I'm Paul Lawrence, a partner at PricewaterhouseCoopers and the co-chair of The Endowment for The Business of Government. We created the endowment in 1998 to encourage discussion and research into new approaches to improving government effectiveness. Find out more about the endowment by visiting us on the web at

The Business of Government Hour features a conversation about management with a government executive who is changing the way government does business. Our conversation today is with Jim Sloan, Director of Financial Crimes Enforcement Network at the U.S. Department of Treasury. Good morning, Jim.

MR. SLOAN: Good morning, Paul.

MR. LAWRENCE: And joining us in our conversation is Kent Owens, a PWC consultant. Welcome, Kent.

MR. OWENS: Good morning, Paul.

MR. LAWRENCE: Well, Jim, I'm not sure a lot of our listeners are familiar with the Financial Crimes Enforcement Network, or FINCEN as I think you like to call it. Could you describe its mission and activities for us?

MR. SLOAN: Certainly. First of all, it is referred to principally as FINCEN. And the title probably creates as much confusion as anything. But the Financial Crimes Enforcement Network is a bureau of the Department of the Treasury. And first and foremost, it's a network. It's a network of information exchange.

FINCEN, on the one hand, is a regulatory agency, and insomuch as we regulate and administer the Bank Secrecy Act, which is the laws that require the reporting of currency transactions and suspicious activity on the part of the financial services industry, which help the law enforcement community and others follow the money in their pursuit of criminal activity.

The other side of the equation is, of course, we service the law enforcement community of the United States and the federal, state, and local level with information that comes as a result of the Bank Secrecy Act, and other data base, as well as our analysis and evaluation of that data.

We are also the financial intelligence unit for the United States, in that we share information with other nations around the world when it comes to the pursuit of individuals who are engaged in financial criminal activity. So it's a pretty large mission for a relatively small agency.

MR. LAWRENCE: I was going to ask about that. Could you give us a sense of the size, the number of and the types of skills? You describe such interesting work, I'm wondering about the people.

MR. SLOAN: We have approximately 250 full-time federal employees. But we're augmented by the nature of our work with personnel from the entities that make up the network, the law enforcement community. For instance, most of the principal federal law enforcement agencies, the FBI, the Secret Service, the Customs Service, Drug Enforcement Administration, all have full-time representation at FINCEN.

We also have detailed personnel from many of the agencies that utilize FINCEN services, who work full-time and do FINCEN work. And we have a contract force, as well, that helps us with much of our activity.

The skills are principally those of analysts and technicians. FINCEN, I think it's safe to say, probably employs between 80 to 85 percent of its work force in those two skill sets. Because we are a small agency and because we deal in such tremendous amounts of data, it's important that we leverage our small work force with cutting edge technology. So we spend a lot of time and effort and money on information technology and it makes up pretty close to 50 percent of our work force.

MR. OWENS: Jim, I was wondering if you could take a moment to tell us about your role as director?

MR. SLOAN: Well, as the director of FINCEN, I, first and foremost, am directing the efforts and furtherance of the FINCEN mission and the efforts of the individuals of whom I just discussed. I mean they're wonderful men and women who have been committed to this work and dedicated to this work and I think are doing a wonderful job at the work.

But I also have the role of providing information and advice on financial crime matters to the Secretary through the under-secretary for enforcement. I also have the responsibility as director for not only administering the Bank Secrecy Act but constantly reviewing the act and being responsible for the rules and the regulations that put the Act into effect. So often times, I'll be wearing a regulator hat and other times I'll be wearing a law enforcement support hat.

MR. OWENS: All right, Jim. Now that we know something about the mission of FINCEN and your role as director, maybe you could take a few moments to talk about your career, how you arrived at FINCEN, what you did prior to this.

MR. SLOAN: I don't think I ever intended on becoming the director of FINCEN. In fact, I should point out that FINCEN is 12 years old, or will be 12 years old in April. It was created in 1990 as a collection of analysts from the IRS and the Customs Service who were intended to analyze the information that comes out of the Bank Secrecy Act, and I'll comment on that perhaps in a few moments.

But my knowledge of FINCEN was somewhat limited, as was the case for most people. I began my career in government as a private in the Johnson Administration back in 1966. I was drafted. At the time, I was working for the New Jersey Bell Telephone Company.

And in its wisdom, the Army decided that it would be a good idea for me to go to OCS. And they chose because I was a lineman for the phone company to become a communications officer. It was one of the few well-placed decisions that I encountered in my time in the Army.

But I'd like to say that I went to the military academy in reverse. I had yet not gone to college, so I took the GI bill and went to college evenings for eight years in New Jersey while I was working full-time as a police officer and a detective in Union County, New Jersey. When I finished college, I decided that I wanted to put the education to even better use and combine it with my interest in law enforcement and I joined the United States Secret Service. I started in the New York field office and spent five years in New York investigating counterfeit currency and other violations that are within the Secret Service jurisdiction, and was transferred to Washington in 1983, and was assigned to then Vice-President George Bush, in his protective detail, and stayed there for another four years, and then did some tours in the Secret Service's Intelligence Division as a staff assistant to the director, and ultimately became the assistant agent in charge of the Office of Administration, and while there, was sent off to Harvard, where I was fortunate enough to become a senior executive fellow at the Kennedy School.

I came back, went back to protection full-time and became a supervisor on the Presidential protective division. And by this time, Vice-President Bush had become President Bush, and I was assigned as the head of the First Lady's detail, then Barbara Bush, and stayed with them until the end of their term, finished my protective assignment, moved on to other assignments in the country, assistant in charge of our Baltimore office, to Boston, where I was the head of the Secret Service operations in New England, returned to Secret Service headquarters as the deputy assistant director and representative on the National Security Council's Counter-Terrorism Security Group, and retired in 1999, and accepted the position as director of FINCEN. So I didn't zero in on FINCEN, but I made it.

MR. LAWRENCE: What is it about public service, what drew you to public service?

MR. SLOAN: I'm the brother, the grandson, the great grandson, and the nephew of law enforcement officers throughout the country. Grandfather was a policeman, great grandfather was a policeman, my brother happened to have been in the Secret Service. I'm also the son of a man and a woman who both served in the military and took great pride in it.

My father was in the Army Air Corps during World War II and my mother was in the Navy during World War II. So I think that government service was pretty well ingrained in my life and that of my siblings and it was a natural calling, I think. But it's not something that, other than that time as a phone company employee that I ever thought of doing differently, with serving in government.

MR. OWENS: When you were in the Secret Service, I understand that you worked in one of the World Trade Center's offices when you were stationed in New York?

MR. SLOAN: Right. In fact, the Secret Service was then located in the U.S. Customs House, which is 6 World Trade Center, and it moved shortly after the bombing in 1993 to the new World Trade Center building, which was 7 World Trade Center. And when the attack of September 11th of 2001 occurred, both of those buildings were destroyed. And in fact, the Secret Service lost an employee during the attack, who was killed during the attack. But they have since rebuilt and are up and running.

MR. LAWRENCE: That's a good stopping point. Rejoin us after the break as we continue our conversation with Jim Sloan of FINCEN. If you don't know what the U.S. Patriot Act is, you'll find out when The Business of Government Hour continues. (Intermission)

MR. LAWRENCE: Welcome back to The Business of Government Hour. I'm Paul Lawrence, a partner at PricewaterhouseCoopers and today's conversation is with Jim Sloan, director of FINCEN and the U.S. Department of Treasury. Joining us in our conversation is Kent Owens, a PWC consultant.

MR. OWENS: Jim, President Bush, on October 26th, signed the USA Patriot Act of 2001 to toughen existing money laundering laws, the bank secrecy act. Can you describe some of the important changes provided in this act and how it might impact FINCEN?

MR. SLOAN: Sure. The Patriot Act has had significant impact on FINCEN, as it has in many parts of the government. The greatest impact has been the recognition in the Patriot Act of FINCEN as a bureau within the Department of the Treasury.

Prior to October 26th, and the President's signing of the act, FINCEN was an agency of the Department of the Treasury without bureau status. And the reason that it has become important is, the taskings, and I'll get into the taskings in a moment to the Patriot Act, the taskings of the Patriot Act required FINCEN to have the ability to be the master of its own destiny, if you will.

Prior to October 26th, FINCEN would have to contract to other agencies for processes as simple as procurement, human resource activity. Even EEO and diversity activity for a period of time was contracted out, where the authorities of the other agencies were utilized by FINCEN in order to accomplish these activities.

So you can imagine having to go through another agency and be queued in their system for hiring, for position descriptions, for background investigations, for adjudication of backgrounds, for simply buying 10 computers, really became a problem for FINCEN.

And the Patriot Act's elevation of FINCEN to bureau status and to bureau authority pretty much changed that concern over night. We didn't suddenly get hundreds of more people in order to accomplish this. We still contract their services, but we certainly have the authorities that didn't exist prior to that time.

As far as the substance of the act, there are many challenges that came from the act that were placed squarely in the lap of FINCEN. For instance, by July, we are required to make available to the financial services industry a highly secure network by which they can e-file their reports under the authority of the Bank Secrecy Act, which would be currency transaction reports, suspicious activity reports, and transmit them, as I say, secure and electronically to FINCEN through our data base in Detroit Computing Center. And additionally, we are to be able to have the ability to then, in return, place alerts and other information back out in a cyber posting to the same industry. Additionally, we are required under the Act to expand some of the regulations of the Bank Secrecy Act. Some we've already been engaged in prior to the Act, only depository institutions, for instance. We're required to submit suspicious activity reporting. And that's where a bank would know, suspect, or have reason to suspect that the transaction is of a suspicious nature.

Since the Act, the Bank Secrecy Act requirements have expanded to the money services business, which are check cashers, money exchangers, currency exchangers, broker dealers in securities, and ultimately, to casinos and other financial service industry providers.

So in addition to the regulatory activity, the bureau status activity, the reporting by electronic activity, we have other reports that are required out of the Act, but it's safe to say that the Act has had a very, very significant impact on FINCEN operations.

MR. LAWRENCE: What are the challenges of dealing with the informal or non-traditional banking institutions like you described, the money exchanging and the money transfer?

MR. SLOAN: Well, you're referring to something that's commonly called hawala. Although I don't speak the language, I am familiar with the fact that hawala in Southwest Asia means trust, essentially means trust. And quite frankly, these are not all illegal operations.

There are many people in the world that transmit their money from one jurisdiction to another by virtue of a hawala. But hawala, by definition, or in the definition of some, is transferring money without actually moving money. It's based on the fact that I may call you in Chicago, and I'm located in London, and I'll say, I would like $5,000 given to a person who will identify themselves with a password or some sort of account number, and then you and I will settle up at a later date without actually transferring money through what would be the traditional wire remittance systems.

In the underground or illegal way, the hawalas certainly provide a degree of anonymity to the users. However, the money service business rules that FINCEN issued and took effect for registration purposes on December 31st require anybody to include hawalas to register with the government through FINCEN, the fact that they are a wire remitter, and once they've registered, they're bound by the same rules of any wire remitter, to issue suspicious activity reports, to report the transmission amounts and the owners of the transmission amounts, and to keep records of those activities for use by the government in a criminal investigation.

MR. LAWRENCE: Is that something they can deal with easily, the hawala? My sense is they like the informality of it and they wouldn't have the technology.

MR. SLOAN: Well, the technology is, for the purposes of registration, is essentially going to the FINCEN web page and downloading the registration form. It's either at, and the msb stands for money service business. So it's pretty easy to get the information regarding the registration activity.

And I should step back a second and tell you that the entire registration for the money service business has been a challenge in its own right. The money loaning suppression act of 1994 required that the so-called money service business be defined and then be registered for expansion by the bank secrecy act.

The money service business is a definition that applies not only to check cashers, or hawalas, or wire transmitters, or money order providers, currency exchangers, the definition actually applies even further, to all non-bank financial institutions that are not brokers, and dealers, and securities, or casinos, they might be a 7-11, or a mom and pop grocery store that transmits money. They all become money service business providers.

In fact, there's about 37 or 38,000 U.S. Postal Service facilities around the Unites States that issue money orders that are all subject to the rules because they provide a money service product.

When FINCEN embarked in this process and I inherited it in 1999, one of the first things that we had to do was to determine how large a universe we were actually dealing with before we could start the registration process.

And we acquired the services of a public relations firm, and we began to essentially go out and find out the extent of the universe. And it's conservatively estimated to be about 160,000 entities within the United States, when you don't even include the Postal Service facilities.

Many of the people who are the subject of these rules are operating businesses that in many parts of the country are the principal financial services for that community, the people who don't necessarily use a bank, but they will use these facilities to wire money and transfer money. There's certain vulnerability relative to money laundering that's inherent in this activity. In fact, we had been able to demonstrate with the Customs Service and the IRS in the past that sometimes people will use these services and exploit them to launder money.

But I must also tell you that the vast, vast majority of the people who are registered as money service businesses are tremendously honest people who are simply providing a much needed service in their community. And we've also had to rely very heavily on their cooperation through the registration process, because many of them don't speak English as their principal language and they've had little or no impact with the federal government as a regulator in the past, although many of them have been regulated by state bank regulators.

The idea that they are now required to do certain things for the federal government is coming as news to them. But without the cooperation of the industry, the industry representatives, and actually the people who work in this environment, we wouldn't have been able to accomplish as much as we've been able to accomplish in less than two years since these rules have rolled out.

MR. OWENS: What is the role of technology in FINCEN carrying out its mission?

MR. SLOAN: As I mentioned earlier, we invest a great deal, both in human resources and in technical resources at FINCEN in the area of information technology. At FINCEN, we get approximately 12 million currency transaction reports a year.

Now, these currency transaction reports are the reports that banks and other financial institutions that take in $10,000 or more in cash or monetary instrument must report the name and the identifiers of that person who's conducting the transaction.

I'll be the first to tell you that many of those reports are probably not of a great deal of use to us, and we have exemption procedures in place to avoid that reporting.

But as we go on in a few minutes, I'd like to discuss what we are doing relative to leveraging technology to try to take great advantage of technology and make sense out of all this reporting.

MR. LAWRENCE: Well, you must have anticipated, we've got to stop for a break, so thank you. Rejoin us after the break as we continue our conversation with Jim Sloan of FINCEN. We'll continue our discussion of how technology is used. Find out when The Business of Government Hour continues. (Intermission)

MR. LAWRENCE: Welcome back to The Business of Government Hour. I'm Paul Lawrence, a partner at PricewaterhouseCoopers. In today's conversation with Jim Sloan, director of FINCEN, at the U.S. Department of Treasury. Joining us in our conversation is Kent Owens, a PWC consultant.

Well, Jim, in the last segment we were talking about technology, and you were describing how technology is used at FINCEN.

MR. SLOAN: Well, Paul, I think actually what I was talking about was the volume of information that we get in, and there were two points I was trying to make, in that we were trying to obviously make certain that the information that we do get is of value and utility to the people that we provide a product to. The same point, the fact that the volume of information requires us to exploit technology perhaps as much, if not more, than most agencies.

With a small staff, leveraging that staff and the data with what I think is cutting edge technology has become very important. By the same token, we want to make sure that we're not creating technological instruments that we can't replicate, because we also need to be able to take technology and allow our customers, if you will, to be able to use the data with some technology that we can provide them. So oftentimes we will take off the shelf technology and convert it to our use and modify it in a way that makes sense to our needs.

But chief among that area would be the use of artificial intelligence and the ability to zero in on the information that's provided in these reports that would come in a narrative form and be able to connect the dots.

The value of our analytical activity is that we are connecting dots. We get 13 million -- 12 or 13 million currency transaction reports, we get currency monetary instrument reports of the money that flows back and forth across the border that customs collects, we get information at a rate of about 10,000 a month from financial institutions on suspicious activity reporting.

We have to have the ability to make sense of this data. We will probably never be able to say that one particular report leads to one particular event in law enforcement. But I do think that we are at the point now where our technology allows us to go through that data and develop patterns and trends that can give clues to law enforcement with regard to money laundering, whether it's in terrorism, whether it's in narco activity, fraud activity, that might not have been readily evident to the law enforcement community prior to that analysis with our technology. So the bottom line is that technology plays a tremendously important role at FINCEN in order to deal with the amount of data that we're required to deal with.

MR. OWENS: Jim, since September the 11th, I imagine that FINCEN has experienced a significant increase in workload. What challenges has this created and what steps are you taking to meet the growing demand for your services?

MR. SLOAN: Well, we're working very closely with the Department of the Treasury, particularly the Office of Enforcement and the Office of Management, to make certain that as our work load increases, that we are able to keep our head above water and that we've got the resources that we need in order to satisfy our mission, to include the mission that has expanded somewhat as a result of the Patriot Act.

But to get back to the first part of your question, I think we calculated shortly after September 11th that about 30 percent of our activity, at least 30 percent of our activity was diverted from what then had been our core function, to issues dealing with a direct result of the attacks, in which we would probably call counter-terrorism or terrorist related activity. In fact, our stock and trade, of course, is information, and a lot of the information that we received prior to September 11th and then after September 11th was from suspicious activity reporting from financial institutions.

We immediately began, the week after the attack, operating 24 hours a day, 7 days a week, something that we had never done. And the reason for that was that we established a hotline, if you will, for financial institutions to report to us the essence of suspicious transactions in more real time.

The law for suspicious activity reporting will allow a financial institution between 30 and 60 days to report to us in the normal course of business. I think it was clear to everybody that the events of September 11th made real time reporting of greater importance and urgency.

So that alone required us, and to this day, requires us to expend more resources in the efforts following September 11th than we probably had planned, as we were looking forward and estimating what our resource requirements would be as we entered '02.

MR. LAWRENCE: As you've talked about the different things FINCEN does, I heard you sort of describe yourself as part of the financial community, the law enforcement community, and even the regulatory community, and so I'm just sort of curious how you manage issues across that group that perhaps might have different perspectives at some times?

MR. SLOAN: Well, we've got a lot of stakeholders, and that's why we are called a network. In fact, when we became a bureau, there was some discussion as to what would we call ourselves, the Bureau of Financial Crimes Enforcement Network, it just didn't seem to fit. Because it was important to me, and I think to most of the people who work at FINCEN, that we retain within our title the term network.

We network a lot of the stakeholders in ways that don't become evident until they've received a phone call or a tap on the shoulder, if you will, from FINCEN. I mean to give you a perfect example, we have a process at FINCEN known as gateway, in which the state governments, all trained by FINCEN and all audited by FINCEN for the integrity of the data, can come to FINCEN and share in some of the information for criminal investigative activity that the Bank Secrecy Act provides.

If, for instance, the attorney general's office in Missouri were to come into FINCEN looking for information about Mr. X, and the FBI were looking for information on the same person because they were working two different types of cases, the FBI might be working a terrorism case, and the state of Missouri might be working a narcotics case, and of course, there's a link, and we will be able to alert both of them by making sure that they aren't working at cross purposes and they understand that they may want to join forces and go after the same person.

But we also are a network because we are very heavily involved with our partners in the regulatory community, the bank regulators, the Federal Reserve, the FDIC, the controller of the currency, supervision, the National Credit Union Administration. We must network with the examination functions in the money service business, which is the IRS exam, or with the securities exchange commission, and the self-regulating organizations in the securities industry, the New York stock exchange, and the NASD.

We also have networking responsibilities with congress. We can supply to congress for their oversight responsibility, or GAO for its investigative responsibilities, information that might help move them in the directions that might otherwise be unseen relative to money laundering activity or terrorist activity or fraud activity. So we have a lot of clients and customers, some of whom probably don't come to the same table anywhere else in government, but do at FINCEN. And the beauty of FINCEN, I think, or one of the beauties, is that we investigate nothing on our own. Our success is measured in the success of all of those agencies.

And I think there's an understanding that because we do not investigate anything on our own, and that we are there to share information and to make certain that everybody is sort of working together and not at cross purposes, we probably find ourselves in a unique role in government, where turf battles don't exist at FINCEN, it's counter to our mission.

And I think everybody who enjoys our services, all 150 who are there full-time in agencies, or the ones that come in through the states, or the ones that come in on a part-time basis, understand that, and I think it's one of the things that we're most proud of.

MR. OWENS: Given this interagency coordination that you speak of that takes place, what mechanisms at FINCEN do you have in place to sort of make sure these happen and coordinated across these agencies?

MR. SLOAN: Well, we have several, of course not the least of which is the one I just mentioned about an alert system and a pointer system to make certain that we are not having two agencies conflict with one another. In fact, we might consider ourselves a deconfliction tool. I mean certainly there are cases in which we wouldn't do that. I mean public corruption cases or national security cases, we're certainly going to default to the agencies that are working those cases to make sure that we don't damage the case by sending the information off into the network and somehow causing the case to be contaminated in some way.

But for the most part, we share the information by sharing leads and pointing one agency in the direction of another if they're working the same case. But beyond that, I think that the greatest sense of cooperation comes from the fact that we oftentimes will proactively develop leads.

I mentioned earlier that the FINCEN Office of Strategic Analysis will look through this massive database, look for trends and patterns, and develop a lead. We will then take those leads and provide them to what we call an inner-agency coordinating group at FINCEN.

If you recall, just about every agency of the federal government that has a need for this information sits at FINCEN. And we meet regularly, and we share the information with them, and determinations are made as to how best proceed with that type of lead or information.

MR. LAWRENCE: That's a good stopping point for this segment. Rejoin us after the break as we continue our conversation with Jim Sloan of FINCEN. In the last segment, we'll ask him to pull out his crystal ball and tell us what the future holds for them. This is The Business of Government Hour. (Intermission)

MR. LAWRENCE: Welcome back to The Business of Government Hour. I'm Paul Lawrence, a partner at PricewaterhouseCoopers. And today's conversation is with Jim Sloan, director of FINCEN in the U.S. Department of Treasury. Joining us in our conversation is Kent Owens, PWC consultant.

Well, Jim, we know FINCEN employees, and you've described technology specialists, intelligence professionals, and enforcement workers. This is a highly skilled and highly educated work force. What are the challenges of managing these types of employees?

MR. SLOAN: Paul, the biggest challenge is remembering that they are highly skilled, highly motivated, and in most instances, know far more about technology and analysis than I ever will. In fact, I learned a lesson a long time ago when I was overseas in the Army in the '60's as a lieutenant in the signal corps, that the best thing I could do was have as my sidekick, if you will, as I traveled around the signal sites was a specialist who knew far more about communication electronics than I could ever learn, so that when we encountered problems, I had somebody there who could assist me in sort of troubleshooting whatever the problem might be, and I have never forgotten that.

And I have been very fortunate to inherit when I came to FINCEN a work force that is skilled, as you say, motivated, as you say, and my job is to make sure that I can continue to give them the tools to stay skilled and motivated. And if those tools are touting their skills to the rest of the world, touting the utility and value of the FINCEN product to the rest of the world, speaking before Congress and the department about the resources that they need to get the job done, and making sure that they have an environment that's safe, secure, in accordance with the human resources practices, whether it's at EEO or just in promotions and other management activity, I provide them with those tools, they provide the United States with a highly motivated and skilled product.

MR. OWENS: Jim, given your organization's requirement to have employees with these specialized skills, talk to us a little bit about the recruiting process, how candidates come through prior to joining the organization, and what steps do you do to retain those employees once they arrive.

MR. SLOAN: Unfortunately, the events of September 11th have put FINCEN at a higher profile than we were prior to September 11th. And I think it's safe to say that given our role in the terrorist money investigations, we have seen more people interested in joining government and in joining in that effort, and I applaud them for wanting to do it, and we are constantly seeking out well-qualified men and women for roles as analysts and information technology specialists.

But we still have to provide incentive. We still have to recruit, we still have to find people who are willing to come and serve government in this capacity. And we've had some success in dealing with colleges in sort of the East Coast area in helping develop programs for analysts in this area.

In fact, one comes to mind, Mercyhurst College up in Pennsylvania, that has worked with FINCEN in developing a course on this sort of activity. And then we can hopefully develop an interest in intelligence and criminal intelligence analysis when the skills are being developed in school and in college and convince the products of those schools that coming to work for an agency like FINCEN is in their best interest, our best interest, and the nation's best interest.

MR. LAWRENCE: How about retaining employees? One can't help but think by the time they've gotten in FINCEN and been there a while, they're very valuable, perhaps in the private sector, as well as in other organizations you deal with; how do you keep them there?

MR. SLOAN: Well, we are in competition with the private sector. I mean we really have a need, and we are fortunate, as I said, to have highly skilled, highly motivated, and very talented people, principally in the criminal analysis, criminal investigative analysis area, and in the financial area, both in technology and in analytical skills.

I mean we have people who we need at FINCEN who are as familiar with the banking industry as people who work in the banking industry. But there is a great deal of motivation. As I mentioned earlier, since the attacks on the United States on September 11th, there are people who are motivated by their dedication to the government and its need to be successful in the current effort. But I also have to pay attention to the retention by making sure that we have a workplace that causes the people who work at FINCEN to recognize that their product is of great value to the United States, whether it's in narcotics investigations, fraud investigations, or terrorist investigations.

And as I mentioned earlier as well, when you measure your success and the success of the agencies that use your product, and we hear more and more of that lately, it becomes an incentive in its own right. And our people appreciate that, I certainly appreciate it, but I guess it's best summed up when you have the President of the United States and three of his senior cabinet officials show up at FINCEN for several hours, as he did in November, and he tells the men and women at FINCEN that they're on the front line of the current activity, and that the things that they do are wonderful and valuable and important to the United States, that's worth an awful lot as far as incentive is concerned.

MR. LAWRENCE: All I say is that's a pretty powerful experience to talk about, but what advice do you give to a young person who's interested in a career in FINCEN?

MR. SLOAN: He or she may not take or may not want to take such a circuitous route as I took to get there. You can get there a lot easier than I did. We certainly would like to speak to you if you have an interest in wanting to come to FINCEN. We have a pretty good website that posts our employment opportunities, and I'm going to take it from memory that it's And if I'm wrong, I'm sure that if you go on a web browser and you put FINCEN, you'll find it. You might find bad things said about us, too, but you'll find us. Or if you go to the treasury home page, there's certainly a link to FINCEN.

We explain on there FINCEN's mission, its responsibilities, and we encourage anybody interested in such a position to log on and look at the positions that are open. We are really talented men and women for positions in this area.

MR. LAWRENCE: What's your vision for FINCEN over the next 10 years?

MR. SLOAN: When I came to FINCEN, I recognized that it had great potential. Now that I've been there for almost three years, it's clear that they've not only got great potential, they're currently doing wonderful things. There are still a lot of people, a lot of entities out there that need to be informed of FINCEN. I mean a presentation like this or a broadcast like this certainly helps a lot of people in the Unites States understand that there is an organization like FINCEN that I think is doing wonderful things.

But in the long run, I think when the law enforcement community or the regulatory community, law enforcement looking to follow the trail of a drug dealer or a terrorist or somebody committing fraud, or the regulatory community looking to enhance their ability to make certain that financial institutions remain safe and sound, I want FINCEN to be at the top of their "to do" list.

When I started in law enforcement as a police officer and a detective in New Jersey, I was a homicide detective for five years; there was no question that the place you went with your need to get forensic services was the FBI lab. They were, they are, and they remain the best in the business as far as forensic activity in criminal investigations.

I'd like to think that FINCEN will be the equivalent, perhaps not forensically, but as far as a resource for the law enforcement and the regulatory community, and we are that, and I think that we'll be even more recognized in that regard.

MR. LAWRENCE: I'd be interested in your reaction to an observation I made during our conversation today, which is, we've talked a lot about the need for technology, the use of technology and artificial intelligence, and yet everything has also been linked to people. So I'm kind of curious as to how you see that going forward in the future, how that linkage will continue to work.

MR. SLOAN: Paul, I'm delighted you asked the question, because it's an important part of any discussion that I have about FINCEN. I mentioned, I think at the outset of the discussion that about 85 percent of our work force is either made up of analysts or technicians. None of our technological skills are worth anything without the human analysts working them, and the human analysts would have a very difficult time working without the technological skills.

But if I had one over the other, I must tell you that the key to our success are the ability of the analysts who can look at information, and based on their skills, their training, their experience, are able to pull out of data that many others, myself included, might not necessarily see. And it's the human input into this entire equation that becomes the key to our success. We could spend a billion dollars a year, and we don't, by the way, a billion dollars a year on technology, and if we didn't have the analytical skills that come from our human resources, it would be meaningless.

MR. LAWRENCE: That's a good final point, because I'm afraid we're out of time, Jim. Kent and I want to thank you for spending time with us this morning.

MR. SLOAN: Well, thank you very much. I've enjoyed it a great deal.

MR. LAWRENCE: This has been The Business of Government Hour featuring a conversation with Jim Sloan, director of FINCEN at the U.S. Department of Treasury. Be sure and visit us on the web at There you can learn more about our programs. You can also get a transcript of today's very interesting conversation. Again, that's This is Paul Lawrence. See you next week.

James Sloan interview
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