On November 4, 2020, the Financial Crimes Enforcement Network (FinCEN) reissued their Geographic Targeting Orders (GTOs) to include the same 12 metropolitan areas issued in May 2020. GTOs are authorized under the Bank Secrecy Act (BSA) to detect money laundering and other illicit activity through the purchases of real estate.
The GTO requires U.S. title insurance companies, their subsidiaries, and agents, to determine the beneficial owners (natural person) behind certain entities used in “covered” residential real estate transactions, including cashier’s checks, certified checks, traveler’s checks, personal checks, business checks, money orders, funds transfers, or virtual currency. Previous GTOs have provided valuable information to law enforcement by following the funds used for various criminal activities, including foreign corruption, organized crime, and drug trafficking.
Real estate purchases have been a successful vehicle for laundering money for many years, particularly through shell companies, which this GTO aims to negate.