By Andrew Weiner and Jay R. Nanavati
Law360
September 6, 2023
On Aug. 15, the Financial Crimes Enforcement Network within the U.S. Department of the Treasury issued Notice FIN-2023-NTC1 to advise U.S. financial institutions of the need to report payroll tax evasion and workers’ compensation fraud involving shell companies prevalent in the construction industry.
While FinCEN’s role safeguarding and increasing domestic and international financial transparency often overlaps with tax enforcement priorities, FinCEN does not generally issue notices on tax evasion. The release of Notice FIN-2023-NTC1 raises questions about whether FinCEN is taking an increased interest in tax enforcement and plans to work more closely with the Internal Revenue Service on these issues.
Given FinCEN’s existing portfolio and budgetary constraints, that remains to be seen, but the notice clearly demonstrates that employment tax violations remain a top priority and foreshadows increased enforcement in the construction industry.
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