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Question & Answer
Question: Some of our customers have indicated that they plan to withdraw cash to be "ready" for Y2K. Should we file SARs if they withdraw unusual amounts cash during the next month?
Answer: It depends. Certainly, if any customer withdraws more than $10,000 in cash, you should file a CTR. There is no question about that. Filing a CTR is triggered only by the amount of cash involved in the transaction. Reasons offered by the customer are irrelevant.
The SAR is a bit less clear. However, here's what we think. Any cash withdrawal that appears reasonable, legal, and consistent with the customer's explanation would probably not need to be reported on a SAR. Making the determination that the transaction passes the smell test may require some "know your customer" work. You should probably consider whether the nature and amount of withdrawal is consistent with the customer's general banking patterns. Taking precautions to be able to meet expected expenses in January, 2000 is reasonable.
However, some customers may do some downright peculiar things that can't be explained to anyone's satisfaction. These transactions probably should be reported on SARs. It is unwise to assume that the approaching Y2K can explain away any peculiar action. Crooks may be counting on this. So file the SAR whenever in doubt!
Copyright © 1999 Compliance Action. Originally appeared in Compliance Action, Vol. 4, No. 13 & 14, 11/99
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