U.S. Treasury Secretary Scott Bessent said tighter oversight of cross-border money transfers should not affect people who can document that funds did not come from state social services. FinCEN has opened probes into certain money services businesses and issued a geographic order targeting Hennepin and Ramsey counties, requiring extra reporting for transfers above $3,000. The actions come amid a broader probe of alleged welfare fraud in Minnesota and political scrutiny involving Governor Tim Walz and the Trump administration.
Treasury Says Overseas Remittances Safe If Senders Can Prove Funds' Origin
FILE PHOTO: U.S. Treasury Secretary Scott Bessent speaks during a press conference to unveil the official Trump Accounts website, at the Treasury Department in Washington, D.C., U.S., December 17, 2025. REUTERS/Aaron Schwartz/File Photo
SAVAGE, Minnesota, Jan 9 (Reuters) — U.S. Treasury Secretary Scott Bessent said the Treasury Department's move to tighten oversight of cross-border money transfers should not penalize people who can document that their funds did not originate from state social service payments.
FinCEN Probes, Geographic Order and IRS Audits
Bessent announced that the Treasury's Financial Crimes Enforcement Network (FinCEN) has opened investigations into certain money services businesses as part of a broader effort to crack down on alleged abuses of federal social benefits in Minnesota. He also said the Internal Revenue Service will audit some banks amid allegations of money laundering.
FinCEN issued a geographic order increasing scrutiny of banks and money transmitters operating in Hennepin and Ramsey counties. The order requires firms in those areas to provide additional information on funds sent outside the United States, including additional FinCEN reports for transactions above $3,000.
Assurances for Legitimate Remittances
When asked whether the stepped-up checks could chill legitimate remittances sent by migrants to families abroad, Bessent said the policy is not intended to target lawful transfers. He told Reuters after touring the Minneapolis-area engineering facility of Winnebago Industries:
"No, it shouldn't. Anyone who can prove where the money has come from ... is fine."
Bessent added that transfers by people living legally in the United States typically move through the regulated banking system and reiterated the administration's position against using public benefits for cross-border transfers that would be improper.
Political Context and Local Impact
Remittances account for large shares of GDP in several poorer countries, including El Salvador and Somalia. The enforcement actions come amid a wider political and legal spotlight on Minnesota, where allegations of welfare fraud involving some nonprofit groups that administer state childcare and other federally funded services have drawn criticism from the Trump administration.
Minnesota Governor Tim Walz, a Democrat who had been mentioned as a potential 2024 vice-presidential candidate, announced this week he will not seek a third term and will instead focus on responding to the fraud allegations. At least 56 people have pleaded guilty since federal prosecutors began bringing charges in 2022.
(Reporting by David Lawder; Writing by Andrea Shalal; Editing by Chris Reese)
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