FinCEN Refers Findings to Federal Investigators to Combat Fraud and Protect Taxpayer Dollars
WASHINGTON – The U.S. Department of the Treasury announced today that its Financial Crimes Enforcement Network (FinCEN) has identified approximately $270 million in suspicious financial activity potentially linked to fraud against federal student aid programs. FinCEN has referred these findings to federal investigators to pursue potential fraud schemes targeting federal student aid programs and help ensure those responsible are held accountable. These referrals underscore the Trump Administration’s commitment to eliminating fraud, protecting taxpayers, and safeguarding the integrity of federal student aid programs.
“Federal student aid is intended to expand educational opportunities, not line the pockets of fraudsters who steal from students pursuing their education and hardworking taxpayers,” said Treasury Secretary Scott Bessent. “The Trump Administration will not tolerate criminals who exploit government programs for personal gain. Treasury is working with financial institutions and law enforcement to identify these fraud schemes, recover stolen funds, and hold those responsible accountable.”
“Federal student aid is meant to support students, not fraudsters. That is exactly why we introduced the new FAFSA fraud detection tool earlier this year, which stops fraud at the start of the federal student aid process,” said Education Secretary Linda McMahon. “We are proud to partner with the White House Task Force to combat fraud, waste, and abuse across these critical programs – already saving American taxpayers more than $2 billion in less than 2 years!”
In a July 2026 Alert, FinCEN warned financial institutions about student aid fraud and asked them to report suspicious activity. That Alert explained that schools or their payment contractors often send aid refunds by electronic bank transfer and that the payment description often includes the word “refund” along with the school’s name or initials. The Alert also noted that fraudsters often move stolen aid through money mules, shell companies, and fake accounts to hide the source of the money. These red flags help financial institutions spot suspicious payments and report them to FinCEN in suspicious activity reports, as required by the Bank Secrecy Act (BSA).
Financial institutions have filed nearly 100 suspicious activity reports since the July Alert. FinCEN’s review of these reports identified more than 20,000 potentially suspicious transactions since February 2026. These reports reflect suspicious activity that has been identified and reported by financial institutions and, therefore, should not be considered a complete representation of the scope of any particular type of suspicious activity. Accordingly, FinCEN has referred this information to law enforcement as tip-and-lead information for further investigation.
Federal student aid fraud schemes often involve fraudulent enrollments designed to divert financial assistance away from legitimate students. In “ghost student” schemes, criminals steal personal information, such as names and Social Security numbers, and use it to enroll fake students in classes under a victim’s identity. Fraudsters may also use super intelligence to produce fake documents that blend stolen information with invented details, which creates what are known as synthetic identities that can pass identity checks. Victims, including minors, often do not know that someone has received student aid in their name.
In “straw student” schemes, fraud rings pay real people for their personal information, enroll those people at a school, and then keep the aid refunds issued to them. Corrupt school employees sometimes help these rings by recruiting straw students and altering their school records. Student aid fraud drains taxpayer funds, and in some cases, keeps real students out of classes that fake enrollees have filled.
Student aid fraud has real consequences for students and American taxpayers. It drains finite grant resources from deserving students, potentially prevents legitimate students from enrolling in classes occupied by fraudulent enrollees, and can leave identity theft victims responsible for debts they never incurred.
As part of the Trump Administration’s efforts to eliminate fraud, waste, and abuse across the federal government, Treasury is working with the White House Task Force to Eliminate Fraud, led by Vice President Vance, and encouraging whistleblowers to report credible information involving fraud, money laundering, sanctions violations, and tax-law violations. Whistleblower tips, combined with financial institutions’ reporting under the Bank Secrecy Act, help Treasury and its law enforcement partners uncover criminal networks, recover taxpayer funds, and hold bad actors accountable.
Treasury will continue to leverage financial intelligence, strengthen coordination across government, and pursue those who seek to profit by defrauding American taxpayers and harming legitimate students.
In My Humble Opinion:
Firstly, “potentially linked” is pretty weak sauce. FinCEN is not referring this for prosecution – they’re referring it for investigation.
Secondly, $270 million total? That’s a rounding error in the federal budget, assuming it’s all found to actually be fraudulent. And you know that it’s not a single borrower – it’s much more likely to be thousands, if not tens of thousands. So, the cost of the investigations are likely to rival the actual funds recovered.
If I didn’t know better, I’d guess this has something to do with the calendar….
This new licence will make it easier for UK businesses to export to trusted partners, without the need to apply for individual licences for each shipment. Importers in new destinations will benefit from reduced delays and less administrative burden when sourcing goods from the UK.
Covering items ranging from civilian aerospace components to academic research data, the licence will significantly facilitate trade and collaboration between key sectors across the globe.
This licence replicates the conditions for 2 existing OGELs in a simplified format, while also expanding the destination scope.
The additional destinations on this licence have arisen from a data-led review of historic licensing decisions, which shows that these exports are consistently approved and present low risk. The inclusion of additional destinations in the OGEL coverage for dual-use goods could save exporters from having to apply for more than 500 individual licences each year. That review continues, and new destinations may be added to the scope of the Dual-Use OGEL in future.
The UK maintains strict export controls, and all exports remain subject to robust legal and security safeguards. By channelling lower risk exports to OGELs, we can focus our expertise on the remainder, ensuring robust oversight where risks are highest.
You must register through SPIRE, the online export licensing system before using this licence. This includes stating where you will keep records of the exports or transfers, and where ECJU may inspect them.
Declaration requirements
As outlined in Notice to exporters 2026/13, when exporters register to use OGELs or GEAs, they are given a unique licence reference in the following format: ‘GBOGE20XX/XXXXX’.
For relevant exports, this code should be input into the UK’s Customs Declarations System (CDS), which includes a field where this licence reference can be entered.
Including the licence reference on CDS will bring goods exports made under OGELs and GEAs into line with standard individual export licences (SIELs) and open individual export licence (OIELs). The roll-out of this requirement across all relevant OGELs aims to deliver data that will help us maintain the appropriate balance between transparency and administrative burden, while providing insight into OGEL usage and trends.
Contact ECJU
You can contact ECJU in the following ways.
Export Control Joint Unit Department for Business and Trade Old Admiralty Building Admiralty Place London SW1A 2DY
Explain the UK’s export control licensing system, and compare and contrast it to that of the US, in language suitable for non-expert professionals. Show your sources and verify that the response is supported by the sources. If anything is less than well-supported, see if you can find sources that buttress or clarifies those points.
The response:
UK and US Export Control Licensing Systems: A Plain-English Guide
Export controls are laws that regulate what goods, technology, and services a country allows to leave its borders — and to whom. They exist to prevent sensitive or dangerous items from reaching hostile states, terrorist groups, or others who might misuse them. Both the UK and US have comprehensive systems, but they’re structured quite differently. Here’s how each works, followed by a direct comparison.
Part 1: The UK System
Who runs it?
The Export Control Joint Unit (ECJU) administers the UK’s system of export controls and licensing for military and dual-use items. It brings together operational and policy expertise from the Department for Business and Trade (DBT), the Foreign, Commonwealth and Development Office (FCDO), and the Ministry of Defence (MOD). DBT has overall responsibility for the statutory and regulatory framework of export controls and for decisions to grant or refuse an export licence. FCDO and MOD are DBT’s principal advisers, advising on the Strategic Export Licensing Criteria used to assess licence applications.
Think of the ECJU as a single front door for the whole system — but with three departments consulting behind the scenes before a decision is made.
What items are controlled?
The UK maintains the Strategic Export Control Lists, which detail military goods, dual-use items, and controlled technologies. These lists align broadly with EU and international lists but diverge in specific areas, particularly post-Brexit. The list is searchable online through the UK government website.
Controlled goods include most items which have been specially designed or modified for military use and their components, including any technology and software used in or with the item, as well as dual-use items — goods that can be used for both commercial or military purposes, such as ball bearings that use technology which could be repurposed to make ballistic missiles.
Importantly, even if a product is not listed on the control lists, it may be subject to end-use controls if the exporter knows or suspects it will be used in prohibited applications, such as weapons development or military purposes in embargoed countries. This “catch-all” provision imposes a responsibility on exporters to obtain licences for unlisted goods if they possess knowledge of restricted end-use.
What types of licences are there?
The UK offers three main licence types, designed to suit different export scenarios:
1. Open General Export Licence (OGEL) — the simplest route. OGELs are the most flexible and commonly used licence, enabling unlimited exports to pre-approved destinations. You only need to register once to start using them. They’re pre-published, publicly available, and cover many routine, lower-risk situations.
2. Standard Individual Export Licence (SIEL) — needed when no OGEL applies. SIELs for permanent exports are generally valid for 2 years or until the quantity specified has been exported, whichever occurs first. The ECJU aims to provide a decision on 70% of SIEL applications within 20 working days, and 99% within 60 working days.
3. Open Individual Export Licence (OIEL) — for repeat business. An OIEL allows a named exporter to export multiple shipments of specific controlled goods to named destinations. It is tailored to an exporter’s specific needs and is available to exporters who have a track record in applying for export licences, or those who can demonstrate business need. OIELs are usually valid for 3 to 5 years.
How are applications assessed?
The ECJU assesses all licence applications on a case-by-case basis against the Strategic Export Licensing Criteria, which provide a thorough risk assessment framework. A licence will not be granted when it is inconsistent with the Criteria. Those criteria weigh factors including human rights in the destination country, regional stability, the risk of proliferation of weapons of mass destruction, and the UK’s international obligations.
What are the consequences of non-compliance?
It is a criminal offence to export controlled goods without the correct licence. Penalties vary depending on the nature of the offence. They can range from de-registration to fines or imprisonment.
Part 2: The US System
A more fragmented structure
The US system is notably more complex because it is split across multiple agencies depending on the type of item involved. The three principal bodies are: the US Department of Commerce’s Bureau of Industry and Security (BIS), which oversees the Export Administration Regulations (EAR); the US Department of State’s Directorate of Defense Trade Controls (DDTC), which oversees the International Traffic in Arms Regulations (ITAR) and the Arms Export Control Act; and the US Department of Treasury’s Office of Foreign Assets Control (OFAC), which administers economic sanctions and embargoes. Nuclear-related export controls are additionally administered by the Nuclear Regulatory Commission and the Department of Energy.
In practice, most exporters need to navigate two main regimes: ITAR and EAR.
ITAR — for purely military items
Administered by the US Department of State through the DDTC, ITAR governs items on the United States Munitions List (USML). This list covers a wide range of defense-related items, from firearms and explosives to spacecraft and advanced targeting systems. ITAR does not only apply to the physical objects themselves — it also applies to technical data and services related to those items. That means design documents, instructions, or even the know-how to maintain an ITAR-controlled aircraft engine are just as tightly regulated as the engine itself.
ITAR regulations place strict restrictions on who can view or handle controlled items and data. In almost all cases, only US persons (meaning US citizens or permanent residents) are permitted access unless a special licence is obtained. Even something as simple as allowing a foreign national employee to view a controlled document on a shared drive could count as a violation if no authorisation is in place.
EAR — for dual-use and commercial items
The EAR regulates the manufacture, sale, distribution and export of commercial and dual-use items, technology and information not already covered by ITAR. The governing agency is the US Department of Commerce’s Bureau of Industry and Security (BIS), and its primary document is the Commerce Control List (CCL). Each item that falls under the EAR is assigned an Export Control Classification Number (ECCN).
EAR applies to dual-use items — those with commercial applications that could also be adapted for military or security purposes, such as advanced semiconductors, encryption software, or certain chemicals. While EAR also places access restrictions, they are more nuanced. The level of restriction depends on the classification of the item, the destination country, the intended end use, and the end user.
Penalties
ITAR licences from DDTC typically take 60–90 days but can exceed 120 days for complex cases. EAR licences from BIS average 30–60 days. Civil penalties can exceed $1M per violation. Criminal penalties for wilful violations include fines up to $1M and 20 years imprisonment.
Part 3: Comparing the Two Systems
Here is where the most practically significant differences lie.
1. Single agency vs. multiple agencies
The UK channels everything through one body — the ECJU. The US divides responsibility between at least three major agencies (State, Commerce, Treasury), plus others for nuclear matters. The US regime has more jurisdictions, more categories of items, and more combinations of restrictions, exceptions, exemptions, and governing authorities. Overall the US regime is similar to but more restrictive and burdensome than the UK regime.
2. The “deemed export” rule — a major US-specific concept
This is one of the most significant differences for organisations employing international staff or collaborating across borders. The US export control regime recognises that certain disclosures or transfers of controlled items to certain individuals (typically foreign nationals that are not exempt) may be deemed to be an export or re-export. In plain terms: showing a controlled document to a foreign colleague in a US office can constitute an “export” requiring a licence.
By contrast, the UK regime has no concept of “deemed” exports — disclosures and transfers under UK law are nationality-agnostic. The UK regime applies to transfers and disclosures of controlled items made from within the UK to destinations and recipients outside of the UK. This is a substantial practical difference for universities, research institutions, and multinationals.
3. Extraterritorial reach — the US casts a much wider net
US regulations routinely apply to items after they’ve been exported from the United States, and in many cases to items that have never touched US soil. For example, foreign-made products or software that contain US components, or are produced with the benefit of technology or software originating in the United States, may be subject to US export licence requirements.
The US export control laws have a wide-ranging extraterritorial reach and the US government seeks to penalise companies and individuals who breach the export control laws, regardless of where they are located.
The UK, by contrast, focuses primarily on exports departing from UK territory. EU and UK sanctions apply within the territory of the United Kingdom, aboard aircraft or vessels under their jurisdiction, to UK nationals, and to entities constituted under UK law. To date, neither the EU nor the UK has aggressively enforced sanctions against foreign persons processing transactions through their financial systems, in contrast to the United States.
4. Licence types and flexibility
The UK regime currently makes more extensive use of open licences and general authorisations (OGELs) for exporting predefined items to eligible destinations. These function as standing pre-approvals for common, lower-risk scenarios, reducing the burden on exporters. The US has analogous “licence exceptions” under the EAR, but commentators generally find them less accessible. Exporters with experience in both systems generally find the EU/UK system easier to navigate.
5. End-use controls
The UK regime has more widely defined end-use controls for unrated items — meaning UK exporters face a broader “catch-all” obligation to seek a licence even for items not on any formal list if they have reason to believe the end-use is problematic. The US end-use controls are similarly broad, though organised differently by item and destination.
6. Shared international foundations
Despite their differences, both systems rest on the same multilateral foundations — chiefly the Wassenaar Arrangement (conventional arms and dual-use), the Nuclear Suppliers Group, the Australia Group (chemical and biological), and the Missile Technology Control Regime. This means the categories of controlled goods are broadly similar; the differences are procedural, institutional, and in the breadth of jurisdiction.
Summary Table
Feature
UK
US
Central body
Single agency (ECJU)
Multiple agencies (BIS, DDTC, OFAC, others)
Main licences
OGEL, SIEL, OIEL
Licence exceptions (EAR), DDTC licences (ITAR)
Military items
UK Military List (via ECJU)
USML / ITAR (via DDTC/State Dept)
Dual-use items
Strategic Export Control List (via ECJU)
Commerce Control List / EAR (via BIS/Commerce)
Deemed exports
Not applicable — nationality-agnostic
Yes — disclosures to foreign nationals in the US can require a licence
Extraterritorial reach
Primarily territorial
Broad — applies to US-origin content worldwide
Ease of navigation
Generally simpler
More complex; multiple overlapping frameworks
Penalties
Criminal fines and imprisonment
Civil fines up to $1M+; criminal fines up to $1M and up to 20 years imprisonment
Practical takeaway: If your organisation exports from the UK, you are dealing with one agency applying one set of criteria. If you work with US-origin technology or employ non-US nationals on US-controlled projects — even in the UK — US rules may apply to you regardless. Any organisation operating internationally should be aware that the two systems can overlap, and compliance with one does not guarantee compliance with the other.
What a way to end the quarter – 9 regulatory updates in the sanctions and export control realm. Yeah, 1 was OFSI’s blog post for its 10th anniversary. Eight substantive posts in a day is still a ton…
Time for us all to kick our heels up and take 5, right?
Compare and contrast podcasts that spend significant portions of their episodes on sanctions and export control topics. Provide a list of the platforms which provide each, and the URL to the podcast’s page (not the URL of any particular episode or recording). include in the analysis the level of detail and sophistication of the content, the range of the topics covered, and the target audience.
The response:
Below is a comparative analysis of podcasts that dedicate significant coverage to sanctions, export controls, and trade compliance. The selected shows range from legal deep dives to high-level geopolitical policy discussions.
Platforms: Apple Podcasts, Spotify, Google Podcasts, Podbean.
Content & Sophistication:
Level: High/Expert. The tag line is “Intelligent talk for trade nerds,” and it lives up to it.2
Focus: This podcast is arguably the most granular regarding legal analysis. Hosts (typically attorneys) dissect specific OFAC (Office of Foreign Assets Control) and BIS (Bureau of Industry and Security) regulations, court cases, and enforcement actions.
Topics: Detailed reviews of new sanctions packages (Russia, Iran, Venezuela), analysis of “complex” regulatory definitions, and enforcement trends.3
Target Audience: Trade lawyers, compliance officers, and export control specialists who need to understand the letter of the law.
2. Sanctions Space
Produced By: ACAMS (Association of Certified Anti-Money Laundering Specialists)4
Platforms: Apple Podcasts, Spotify, ACAMS website.
Content & Sophistication:
Level: Professional/Industry Standard.
Focus: The perspective here is heavily skewed toward financial crime and banking compliance. It focuses on the operational challenges of screening, financial flows, and the intersection of sanctions with anti-money laundering (AML).
Topics: Global sanctions regimes (UK, EU, US divergence), evasion typologies, and interviews with high-level regulators and bank compliance heads.5
Target Audience: Compliance officers in financial institutions (banks, fintechs), risk managers, and financial crime investigators.
3. The Trade Guys
Produced By: CSIS (Center for Strategic and International Studies)6
Focus: While broader than just sanctions, it regularly covers export controls (especially regarding China and semiconductors) and tariffs as tools of foreign policy.7 It is less about “how to file this license” and more about “why is the White House doing this?”
Topics: Geopolitics of trade, Section 301 tariffs, the tech war, and supply chain decoupling.
Note: The tone is conversational and polished, making complex policy accessible to non-lawyers.
Target Audience: Policy wonks, business executives, journalists, and anyone interested in the intersection of national security and economics.
Focus: This is a distinct format—often short, AI-enhanced or AI-generated summaries designed to give listeners a quick download of recent enforcement actions and regulatory updates.9
Topics: Specific enforcement penalties (e.g., “Company X fined $1M for Y violation”), updates to the Entity List, and brief regulatory summaries.
Target Audience: Busy trade compliance professionals who need a “daily briefing” style update rather than a deeply researched hour-long discussion.
Summary Comparison Table
Podcast
Best For…
Tone
Primary Lens
Embargoed!
The “Trade Nerd”
Witty, Legalistic, Detailed
Legal & Regulatory Interpretation
Sanctions Space
The Bank/FinCrime Pro
Professional, Interview-based
Financial Crime & Banking Compliance
The Trade Guys
The Policy Watcher
Conversational, High-level
Geopolitics & Economic Strategy
Trade Compliance Brief
The Busy Practitioner
Concise, Rapid-fire
News & Enforcement Updates
Note: I had a sanctions podcast some years ago. It was called DesigNation. It was really hard to maintain a regular cadence of shows – and make it entertaining.
I hope you have more fun on New Year’s Day than I will. I’ve discovered that the prompt I use to parse OFAC updates is not great – at a minimum, with cargo vessels. So, I’m going to re-engineer the whole thing to properly identify the various data elements – like the cargo vessel call sign, which I only noticed for the first time today.
I will go back and update the affected posts when I get this right… thank goodness I only started doing this in early December.
In the meantime, party hearty, but stay safe this New Year’s Eve. I’ve got Andy and Anderson recording on CNN for when my wife and I get back from dinner… don’t we have the best life?
So, I asked some friends and co-workers for some feedback about this site, and a former co-worker asked me what the purpose of it was. I recognized this was a real gap – after all, while “Mr. Sanctions” is catchy, should folks read it, and why?
In fact, even naming this page was a bit of a challenge. I considered “Why Read Mr. Sanctions?”, but part of me didn’t want to make this a marketing “sell” – other than informing folks. For the same reason, “Is this for me?” and the like ended up in the trash can (Mac guys don’t use Recycle Bins).
So… is this for you? Depends on what you’re looking for, of course.
I am not a lawyer nor do I work for the U.S. Treasury and the like. What I have been for much of my career is someone who tries to make the complexity of sanctions accessible. And that’s really what this site strives to be: a way to read sanctions-related info in a more easy-to-digest way, removing layers of complexity, reformatting information so the pieces you care about are easier to identify, and using summarization to provide quicker reads. Of course, we provide the links to the original in case you want more detail.
This is also a working space for leveraging AI tools (most notably, Google Gemini) to find insights and trends. The ability of these tools to scour for information and organize it is impressive – no way could I have come up with the insights derived about Executive Order 14024 by myself.
As you may have seen, my first attempt to find parallels between enforcement actions wasn’t awful, but could surely use refinement. As I’ve already seen, trying to build all the most basic models is, at best, a matter of trial and error. And, as my wife reminds me, the more you direct a model, and the less you leave it free to “experiment”, the more predictable the results are. I will be sharing the technical details, like my prompts, for those who want to experiment on their own dime.
Oh, and the image on the home page? Also Gemini – but the first output had 2 left hands and 1 right hand Easy enough to fix, but it gave me a chuckle.
First, a confession: when I stopped posting there, I didn’t hold onto the domain name and, as is typically the case, someone swooped in and is holding it hostage.
But, perhaps more importantly, MrWarchlist.com was a little too broad. Sanctions has always been my first love, so it only makes sense that, when I recently decided I wanted to blog again, it was only natural to cut out that which did not spark joy. So, goodbye to AML stuff, anti-bribery and corruption stuff, unauthorized firm stuff…
Now, will this be different in other ways? Yeah – I want to leverage some of the AI tools to pull out some insights from the available online info, and post that value-added info alongside the actual regulatory text. Some of the stuff is pretty basic: I got a prompt working where you can nicely pull out what changed in those OFAC listings (I hate trying to compare them). Other insights are more aligned with my love of enforcement actions: finding not only trends in yearly actions and across regulators (although it’s still really only OFAC and OFSI at this point), but also trying to find what previous actions the new one is most like. Won’t that be fun? I sure think so.
OMG – I just realized some of you actually have no idea who I am. I’m Eric A. Sohn, formerly CAMS and CGSS-certified, formerly a frequent author for industry publications and an occasional presenter to conferences and customer groups. While I currently manage some sanctions analysts for a firm which supports the securities industry, I have done stints in VendorWorld for Accuity (as a professional services consultant) and Dow Jones (authoring a weekly sanctions newsletter, doing a vendor selection for name matching software, and being the pre-sales SME). And I am diving back into the professional association world, having just joined ACSS.
In my spare time, I an a rabid Philadelphia Eagles fan, and spend lots of time walking and playing with my 5-year old rescue dog (Pug/Shih Tau/Pekingese mix). The family: wife of 32+ years, and two adult offspring.
It’s been a long time since I set up my last blog – MrWatchlist.com. I’m guessing it will take a while to figure out which bells and whistles I really need.
In the meantime, I went and subscribed to email updates from OFAC, OFSI, OSFI, the EU, UN, Canada (OSFI and Global Affairs Canada), and the Australian Sanctions Office. Probably should add BIS and the Export Control Joint Unit (I know, not strictly sanctions, but it’s not infrequently screened), and FinCEN (for Section 311 additions) and… I can smell the scope creep. Maybe I will let sleeping dogs lie, for now.
