A View from the CT Foxhole: Brian Nelson, Under Secretary of the Treasury for Terrorism and Financial Intelligence.

AuthorHummel, Kristina

CTC: You assumed the role of Under Secretary of the Treasury for Terrorism and Financial Intelligence at the end of 2021. What have been TFI's priorities over the first year and a half of your tenure as pertains to the CT realm? How is Treasury responding to the shifting CT landscape?

Nelson: The Office of Terrorism and Financial Intelligence's (TFI) mission is to enhance national security by applying Treasury's unique policy enforcement, intelligence, and regulatory tools to identify, disrupt, and disable terrorists, criminals, and other national security threats to the United States and to protect the U.S. and international financial systems from abuse by bad actors. TFI marshals the Department's intelligence and enforcement functions with the dual aims of safeguarding our financial system against illicit use and also combating corrupt regimes, terrorist facilitators, weapons of mass destruction proliferators, money launderers, drug kingpins, and other national security threats.

So while TFI was formed with a specific terrorist financing focus after the 9/11 attacks, the scope of our work has really evolved over time. One of TFI's core missions is to safeguard the domestic and international financial systems from abuse and we do this by identifying and closing vulnerabilities that illicit actors use to support their networks. As such, while today's conversation, of course, is focused on CT and TF [terrorist financing], I just want to emphasize that it's hard to discuss that topic without looking at the entire anti-money laundering/countering the financing of terrorism (AML/CFT) picture. Criminals and illicit actors are using all means to raise funds, which impacts money laundering and other illicit financial activities as well.

The demands for my office's expertise have really grown quite exponentially in the last several years. CFT remains an important part of our work here, but more than ever, it's one aspect of a broad set of priorities. And it is difficult to completely separate it as other priority adversaries and criminals use similar techniques to exploit AML/CFT vulnerabilities similarly as terrorist financiers. So while some things have changed in the CT landscape, some things have stayed constant: Terrorist groups continue to try to exploit vulnerabilities in the international financial system as well as jurisdictions with weak governance to raise, move, and use those funds. Likewise, TFI continues to use our tools strategically both to disrupt the financial operations of specific networks and on a more systemic level to close the regulatory loopholes and vulnerabilities which allow these groups to use the formal financial system in the first place.

To maximize our resources and effectiveness, we have really focused our efforts on key facilitators, regional financial hubs, and building partnerships and capacity with priority jurisdictions. This has required a coordinated effort here across all components of Treasury, including our policy, intelligence, sanctions, and enforcement offices. It has also required working closely with other U.S. government agencies to develop a shared understanding of terrorist financing risks and threats, pursue opportunities to disrupt TF, and support interagency CT efforts.

Internationally, Treasury--in coordination with the departments of State as well as Justice and other interagency partners--works bilaterally as well as multilaterally to share typology and transactional information and to engage and build capacity so our foreign partners can take their own actions to dismantle TF networks and prevent terrorist access to the international financial system. Engaging our foreign partners--again, bilaterally and multilaterally--is key to increasing our collective TF risk understanding, maximizing the impact of our actions, and enabling our partners to take their own actions. Just as an example, we have prioritized building up partner capacity to identify and disrupt TF threats through our Terrorist Financing Targeting Center, the TFTC, which is a multilateral forum among the United States and the Gulf countries.

Our multilateral engagement through a variety of international fora as well as these bilateral conversations with our key partners allows us to share lead information and investigative best practices that are designed to build partner capacity. This range of engagements has resulted in better coordination and more effective sanctions and other disruptive outcomes. This is something that we looked at closely through a review of our sanctions' authorities in particular, and it has also created avenues to engage countries on other priority illicit finance issues.

CTC: Can you describe your career trajectory and how that prepared you for the role you're now in? What lessons have you learned along the way and what advice would you offer to professionals in this feld, specifically the CFT field?

Nelson: Thank you for that question. The first week I started law school was the week of 9/11, so it really shaped my desire to serve our country. Once I got out of law school, I spent a brief moment in private practice before having the opportunity to serve in the Department of Justice, working in the national security division. This was 2009, 2010, 2011 and one of my reflections was that we were seeing terrorist groups that were still plotting threats directly to the U.S. homeland. We were nine, 10 years out from 2001, but we were still seeing that they had the resources and the ability to attempt to strike us here at home. Over my time, in just three years, the capacity of those groups to do that diminished significantly. The thing I took away from that experience was, while the Department of Justice was doing incredible work with partners and colleagues, it was the Treasury Department that had cut off the money, and that really starved a lot of these terrorist groups from frankly having the capacity to attempt to strike the homeland.

I left federal service for the State of California and there worked on transnational...

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