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December 19, 2014
PREPAID PRODUCTS - Understanding the CFPB Proposal
John Burnett

January 6, 2015
Business Accounts Documentation and Procedures with Beneficial Ownership
Deborah Crawford

January 6, 2015
FFIEC Cybersecurity Initiatives and Observations from the 2014 Assessments
Susan Orr

January 15, 2015
The ABC's of IRAs - The Basic Ingredients
Patrice Konarik

January 20, 2015
B & Z Appraisal Rules - Getting Them Right
Jack Holzknecht

January 21, 2015
HMDA Soup to Nuts
David Dickinson

January 22, 2015
Navigating the Treacherous Waters of IRA Rollovers, Transfers and Beneficiary Payouts
Patrice Konarik

January 28, 2015
Mortgage Life Cycle
Part I
David Dickinson and Jerod Moyer



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#1661105 - 02/06/12 01:50 PM Would you file a SAR?
Polo Offline
100 Club

Registered: 02/18/03
Posts: 178
If the bank determined that our customer was paying a building contractor, per the contractor’s request, cash amounts directly under the reporting threshold would the bank have the responsibility to file a SAR?
The customer claims to be ignorant of the reporting threshold and claims that the contractor did not say anything about CTR threshold or avoiding taxes.

Assuming the customer was simply paying the contractor the requested amounts (multiple times & over $50,000) until the job was finished would the bank be liable to report this on a SAR?
Thank you

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BSA/AML/CIP/OFAC
#1661221 - 02/06/12 03:25 PM Re: Would you file a SAR? [Re: Polo]
BC78a Offline
Gold Star

Registered: 05/05/06
Posts: 294
Loc: New York
At a minimum I would file a SAR on the contractor, and list the customer in the narrative. However, I find it hard to believe that in this day and age, any businessperson does not know of the reporting requirement. Better yet, why was the customer paying in cash instead of by check?


Edited by BC78a (02/06/12 03:34 PM)
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Just my opinion for what it is worth

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#1661223 - 02/06/12 03:29 PM Re: Would you file a SAR? [Re: Polo]
Doug Hendrickson Online
Power Poster

Registered: 10/01/09
Posts: 3426
Loc: NE New Mexico
I would file the SAR on the customer, if it is the customer who is withdrawing the cash from his/her account. I would certainly name the contractor (giving as much identifying information as possible) in the narrativ; but since he/she is not the customer in this instance, I would not file on them as such.

I pretty much can assume why the contractor wants cash, but the customer should be paying by check so that they have a formal record of payments. If the contractor wants cash, let them cash the check.
_________________________
I hear and I forget. I see and I remember. I do and I understand.--Confucius

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#1661287 - 02/06/12 04:25 PM Re: Would you file a SAR? [Re: Polo]
AquaMarine Offline
100 Club

Registered: 06/23/11
Posts: 141
Loc: New York, NY
Having knowledge or not is irrelevant. It is hard to believe the customer was not aware of such common banking law. File a SAR on your customer and mention the contractor in the narrative and move on.
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"Give thanks in all circumstances; for this is God’s will for you in Christ Jesus." -Thessalonians 5:18


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#1661291 - 02/06/12 04:44 PM Re: Would you file a SAR? [Re: Polo]
BrendaC Offline
Power Poster

Registered: 09/18/01
Posts: 6029
Loc: Sweet Home AL
Wanna bet the customer got a little "discount" for paying in cash? He knew exactly why the contractor wanted cash.

I agree - file a SAR and move on. The why's aren't really your problem, let law enforcement decide if they want to dig deeper.
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Life without Jesus is like an unsharpened pencil - it has no point.

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#1661382 - 02/06/12 07:27 PM Re: Would you file a SAR? [Re: Polo]
ItNeverEnds CRCM Online
Platinum Poster

Registered: 10/27/06
Posts: 633
Loc: Looking for my sanity
Diputs - just for clarification, are the funds actually coming out of (or in to) an account with your bank? Or are these cash payments directly from the customer to the contractor and don't involve your bank? I just wasn't sure from your post. If the funds involve your bank and there's evidence of structuring, then yes I agree file a SAR on the customer as Doug states. But if this is just based upon having knowledge that the customer is paying the contractor in amounts under 10k (cash not involved with the bank), I don't know that a SAR would be appropriate because you have no actual knowledge or information of payments, withdrawals, etc, and there's no transaction conducted through the bank.
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"The reason I talk to myself is because I’m the only one whose answers I accept."
- George Carlin

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#1661406 - 02/06/12 11:01 PM Re: Would you file a SAR? [Re: Polo]
rlcarey Offline
10K Club

Registered: 07/16/01
Posts: 51218
Loc: Galveston, TX
I have seen this before. Multiple $9,000 or $9,900 checks written either at one time or over a short period of time, all negotiated at local check cashers. They are both guilty (well at least suspects smile ), file the SAR.
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The opinions expressed are my own, take them or leave them.

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#1661435 - 02/07/12 08:32 AM Re: Would you file a SAR? [Re: Polo]
Ken_Pegasus Offline
10K Club

Registered: 08/30/01
Posts: 17570
Loc: Another trip around the sun
Two subjects/suspects. File the SAR.
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"Oh God, thy sea is so great and my boat is so small." Breton fisherman's prayer in JFK's office.

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#1661472 - 02/07/12 09:22 AM Re: Would you file a SAR? [Re: Polo]
ACBbank Online
Power Poster

Registered: 07/26/06
Posts: 2690
Loc: New York City
To continue the conga line, file the SAR.
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"100 victories in 100 battles isnt the most skillful. Subduing the other's military w/o battle is the most skillful." Sun-Tzu

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#1661479 - 02/07/12 09:34 AM Re: Would you file a SAR? [Re: Polo]
Kathleen B Online

10K Club

Registered: 12/27/00
Posts: 17856
I have also seen this done where the customer writes the checks for $8,000 or $9,000 regularly for cash and tells the bank/writes in memo line that it is for a contractor. The bank knows that the customer has construction being done on their home.

While the contractor may very well want cash to avoid the issue of bad checks, it is still structuring and should be reported.
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Kathleen Blanchard CRCM "Kaybee"
Lending/CRA/HMDA/Mapping/Consulting
www.kaybeescomplianceinsights.com

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#1661545 - 02/07/12 11:08 AM Re: Would you file a SAR? [Re: Polo]
ItNeverEnds CRCM Online
Platinum Poster

Registered: 10/27/06
Posts: 633
Loc: Looking for my sanity
I don't disagree about the SAR filing in any of these circumstances. I just read Diputs post a little different and I was just trying to understand how the transactions were being conducted. Was the customers account at the bank involved or did the customer tell someone at the bank they were doing this? If it was just something the customer said to an employee, but a review of the account doesn't show any checks written, transfers, withdrawals, etc, does that change anything? I mean what if they're doing this with money they already have in their home or something, does the bank still file a SAR? If the bank has knowledge, but can't find record or see any transactions? I'm not saying that the bank shouldn't file in that circumstance, but I don't know. I just want to understand for myself how it should be handled.
_________________________
"The reason I talk to myself is because I’m the only one whose answers I accept."
- George Carlin

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#1663880 - 02/11/12 01:42 PM Re: Would you file a SAR? [Re: Polo]
patsfan Online
Gold Star

Registered: 04/17/09
Posts: 251
I wouldn't file a SAR. Nothing to see here.

Just kidding, this is a pretty easy one.
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CFE, CAMS

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#1664132 - 02/13/12 11:48 AM Re: Would you file a SAR? [Re: Polo]
Polo Offline
100 Club

Registered: 02/18/03
Posts: 178
Thank you all for your astute comments and observations.
I personally feel that structuring has occurred regardless of whether it was on behalf of another or just by our customer. However, the SAR committee is sighting “the bank knows of no reasonable explanation for the transaction after examining the available facts” from the SAR guidance and says that the statement from the customer regarding the payment for work done, is a “Reasonable Explanation”.
Where does one draw the line when it comes to a “Reasonable Explanation”? Anyone caught structuring would be willing to give any explanation that might sound reasonable. When does the bank determine that an explanation is not reasonable and is unreasonable?

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#1664140 - 02/13/12 12:10 PM Re: Would you file a SAR? [Re: Polo]
BrendaC Offline
Power Poster

Registered: 09/18/01
Posts: 6029
Loc: Sweet Home AL
The question here is not whether the work was done. The question is whether the series of transactions just under $10k represent a logical payment pattern for this business transaction; understanding how/why they do not appear to be transactions structured in such a way as to prevent the filing of a CTR.
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