Government watchdog chides FinCEN for pushing hiring of attorneys in revamp for investigator slots

By Brian Monroe
bmonroe@acfcs.org
May 19, 2017

A United States government watchdog group has criticized the U.S. Treasury bureau responsible for administering the nation’s financial crime compliance defenses, stating the agency pushed to require applicants have prosecutorial experience as attorneys, something not in official hiring rules.

The report made public Wednesday by the U.S. Office of Special Counsel (OSC) is rare criticism for the Financial Crimes Enforcement Network (FinCEN), which in recent months has found itself feted by lawmakers, who openly queried if it needs more resources or assistance in a recent Congressional hearing.

At issue is that when FinCEN was reorganizing itself in different divisions to make data analysis, enforcement and overall communication and coordination more efficient and effective, both inside and outside the agency, it was screening applicants for several top investigator positions based on if they were attorneys, and even more desirable, former prosecutors.

But the official prerequisites for those government investigator positions had no such attorney or prosecutorial experience requirement, meaning that FinCEN requiring such unwritten qualifications was not fair to the broad universe of seasoned applicants applying for the few and choice spaces available at the agency – and also potentially cut out many longtime insiders.

The joint audit performed by the U.S. Treasury and Office of Personnel Management comes after a revamp of FinCEN by its former leader Jennifer Shasky-Calvery, who left for a top anti-money laundering (AML) compliance position at HSBC last year.

She is credited with being a positive, transformative force at FinCEN, making the department leaner, meaner and more relevant, but also chafed some longtime staffers with her focus on bringing in experienced, qualified outsiders with a deep knowledge of complex financial crime investigations and prosecutions – a foreshadowing of a greater focus on enforcement that would come under her leadership.

OSC found that during an organizational-wide revamp occurring in mid-2013, FinCEN’s hiring actions “did not comply with federal hiring rules and regulations regarding merit system principles, which constitutes a violation,” according to the report.

In mid-2013, FinCEN was in the process of reorganizing into six divisions based on key functions: Enforcement, Policy, Intelligence, Liaison, Technology, and Management. Among other vacancies, three new supervisory positions were announced, according to the report.

“Both the position descriptions and vacancy announcements identified these jobs as GS-1801 investigator positions,” according to the report. “Nevertheless, FinCEN leadership determined that they wanted attorneys to fill the positions.”

In addition, by “misleading applicants about the qualifications required for the jobs, FinCEN willfully obstructed the right of applicants without attorney experience and with no prior federal service to compete for the positions,” according to the report.

By the time OSC issued its report, the Treasury Department “had already taken steps to regularize the appointments in question.” OSC also recommended that “all FinCEN managers and human resources staff receive appropriate training.”