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#1273495 - 10/26/09 02:37 PM Suspicious or Normal
maggie mae Offline
Member
Joined: Dec 2005
Posts: 75
Suffolk County, New York
Over time our activity assessments have been refined. In some instances, activity that we once thought suspicious has been reevaluated as a business's standard-operating-procedure. One activity, however, is of concern. Some businesses buy goods for cash (recycling aluminum / copper, etc., and the purchase of precious metals like gold). A warehouse manager recently told me that when he sold aluminum and asked for a check, he was told that they only deal in cash. I believe that, even if this is business-as-usual, there is an underlying (suspicious) reason that these business only deal in cash. Any thoughts?

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#1273525 - 10/26/09 03:12 PM Re: Suspicious or Normal maggie mae
Hrothgar Geiger Offline
10K Club
Hrothgar Geiger
Joined: Jun 2005
Posts: 10,395
Jersey Shore
My team's exposure to 'commodity' purchases is more in the trade finance arena. Even there, we tend to look at purchases of metal, sugar, coffee and even oil as having an higher than average risk of fraud and/or money laundering.

I don't think your suspicions are unwarranted.

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#1274013 - 10/26/09 08:02 PM Re: Suspicious or Normal Hrothgar Geiger
EdieT Offline
Member
EdieT
Joined: May 2009
Posts: 76
PA
I agree. Any all cash business can easily be laundering money or at least avoiding tax reporting. It merits watching.

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#1277050 - 10/29/09 06:26 PM Re: Suspicious or Normal EdieT
McGruff Offline
Gold Star
McGruff
Joined: Feb 2004
Posts: 262
Texas
I agree with everything that has been said thus far.

However, I have learned that (in my area at least) most recycling places deal only in cash. It appears to be an industry standard. I would consider it normal activity, unless there was a surge in activity. I'd give that account a little look-see on a regular basis, anyway.

As far as precious metals, I've seen precious metal dealers use cash for small purchases, and checks for larger purchases--which I find reasonable. If your guy is dealing strictly in cash, that would get me interested in digging deeper and finding out exactly where he's spending all this cash. A friendly store visit by his banking officer wouldn't be out of place.
Last edited by McGruff; 10/29/09 06:26 PM.
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