Rising use of fraud related to counterfeit passport cards impels notice to banks to be on alert

Fraud schemes related to the use of counterfeit U.S. passport cards has prompted a notice to financial institutions from the Treasury’s financial crimes enforcement unit, the agency said in a notice issued Monday.

According to the Financial Crimes Enforcement Network (FinCEN), the notice provides an overview of typologies associated with U.S. passport card fraud, highlights select red flags to assist financial institutions in identifying and reporting suspicious activity. The notice also and reminds financial institutions of their reporting requirements under the Bank Secrecy Act (BSA), FinCEN said.

The agency said that over the past five years (from 2018 to 2023), U.S. passport card fraud caused $10 million in actual losses and $8 million in additional attempted losses with more than  4,000 victims in the United States.

“However, DSS (Department of State’s Diplomatic Security Service) and other law enforcement agencies assess losses associated with U.S. passport card fraud and associated identity theft are likely significantly greater and seek increased reporting by financial institutions to identify additional illicit activity,” FinCEN said in a release.

The agency asserted that fraud, including financial crimes related to the use of counterfeit U.S. passport cards, “is the largest source of illicit proceeds in the United States and represents one of the most significant money laundering threats to the United States.”

FinCEN Issues Notice on the Use of Counterfeit U.S. Passport Cards to Perpetrate Identity Theft and Fraud Schemes at Financial Institutions