The Life and Times of a Currency Transaction Report (CTR) by Dennis Crawford
Do you ever wonder what happens to those Currency Transaction Reports (CTRs-Form 4789) and Suspicious Activity Reports (SARs) that you file with the IRS Detroit Computing Center (DCC)?
Receipt of Currency Transaction Reports
Whether filed in paper or electronic format, after the CTRs are received in Detroit, they're sorted by type and reviewed for completeness. In 1996 over 12 million (12,752,124) CTRs were reviewed and posted into the Currency Banking and Retrieval System, as well as 56,114 SARs.
Building the Currency Banking and Retrieval System (CBRS)
Approximately 60% of financial institutions file their reports via magnetic tape which is uploaded directly into the Currency Banking and Retrieval System data base. The remaining 40% arrive in paper format and are entered onto magnetic tapes by IRS and then uploaded onto the data base.
There are specific time frames in which CTRs and SARs are required to be posted to the Currency Banking and Retrieval System data base. All CTRs must be entered into the data base within 30 days of receipt and all SARs must be entered within 10 days of receipt.
All data from the CTRs and the SARs in the Currency Banking and Retrieval System can be accessed by federal, state, and local law enforcement agencies and is used as an investigative tool. During Fiscal Year 1997, authorized users completed over 57,660 queries on the system. In addition, each month there are an estimated 100,000 queries to the data base by Department of Treasury agencies.
Using a system called FinCEN's Gateway, subscribing agencies conduct their own research on the system. Subsequently, Gateway electronically captures the information gathered on incoming inquiries and automatically compares this information to prior queries. This enables state and local agencies to coordinate investigations among themselves and with Federal agencies. After obtaining the required dissemination authorization, FinCEN provides an automated report to each agency that has an interest in their same investigative subject. These reports are called "Gateway Alerts," and contain the index-level data and contact points so that the agencies involved may coordinate their investigations and share intelligence.
Analyzing the Data in the Currency Banking and Retrieval System
The combined currency information in the Currency Banking and Retrieval System is extremely important for tax administration and law enforcement. The information provides a paper trail or roadmap for investigations of financial crimes and illegal activities, including tax evasion, embezzlement, and money laundering.
IRS Criminal Investigation special agents and Assistant U.S. Attorneys can cite case after case where the in-depth review of information contained in one or more of these currency reports has led to a significant guilty plea, conviction, or asset forfeiture action.
All in all, these reports often serve as an important method of identifying leads used by our special agents in conducting investigations.
Storage and Destruction on Currency Reports
After seven years, the original CTRs and SARs are inventoried, boxed and shipped to the Federal Records Center. The documents are then stored there for an additional three years. After the total life span of 10 years, the original reports are destroyed.
The electronic data in the Currency Banking and Retrieval System is kept current for ten years. After ten years, the information is archived in Detroit to an electronic environment for needed historical research.
Does the IRS really use those reports filed by financial institutions? Within a four year period (Fiscal Years 1994, '95, '96 and '97), IRS Criminal Investigation Division initiated 1,030 investigations as a result of information reported by financial institutions.
This doesn't include the number of investigations where the CTR, or SAR, provided a roadmap to an already on-going investigation.
They have proven to be extremely effective investigative tools used in the identification of financial crimes.
Dennis Crawford is Director, National Operations Division, IRS Criminal Investigation, Washington, DC.
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