IRS Criminal Investigation Unit Launches CI-FIRST Initiative to Strengthen Collaboration with Financial Institutions

The Internal Revenue Service’s criminal investigation unit (IRS-CI) has introduced a new initiative aimed at enhancing collaboration with financial institutions. The program, known as Feedback in Response to Strategic Threat (CI-FIRST), was officially announced on Friday and is designed to streamline subpoena requests, provide banks with improved data, and expedite financial crime investigations. Under the Bank Secrecy Act, financial institutions are required to report potential cases of money laundering and terrorist financing through Suspicious Activity Reports. CI-FIRST seeks to enhance this reporting process by improving data-sharing between banks and law enforcement agencies. The initiative is particularly focused on cases connected to fentanyl trafficking, drug trafficking, and human smuggling.

“Public-private partnerships thrive when everyone mutually benefits,” stated IRS-CI Chief Guy Ficco, underscoring the importance of cooperation in combating financial crimes.

Along with the announcement of CI-FIRST, IRS-CI also disclosed new data regarding its enforcement efforts over the past two years. Between 2022 and 2024, the agency identified $21.1 billion in tax and financial fraud, seized $8.2 billion in criminal assets, and recovered $1.4 billion in restitution for victims. “Behind all of these metrics are real crimes with real victims,” said Lauren Kohr, IRS-CI’s strategic engagement adviser. She emphasized the vital role of Bank Secrecy Act data in tracking illicit financial activities and dismantling criminal networks. “When illicit money moves, it’s these BSA reports that tell us the story,” she added, reinforcing the significance of financial reporting in law enforcement investigations.

IRS-CI agents conduct nearly one million searches each year using Currency Transaction Reports, which banks are required to file for cash transactions exceeding $10,000 in a single day. These reports play a crucial role in financial crime investigations. Over the past three years, 67% of IRS-CI cases involved at least one Currency Transaction Report below $40,000, with half of them reporting amounts under $22,230. However, there has been increasing pressure from banks to raise this reporting threshold.

A group of Republican lawmakers has proposed the Financial Reporting Threshold Modernization Act, a bill aimed at increasing the reporting limits to $30,000 for Currency Transaction Reports and $10,000 for Suspicious Activity Reports. Additionally, the legislation calls for adjusting the Currency Transaction Report threshold for inflation every five years. A key House subcommittee is scheduled to review and discuss the proposal during a hearing on April 1.

In a related development, a report from the Government Accountability Office published in December recommended that the U.S. Treasury reduce the number of unused Currency Transaction Report filings. The report suggested either raising the transaction threshold or expanding exemptions to minimize unnecessary reporting while maintaining effective oversight of financial crimes.

By fLEXI tEAM