First let me say I have searched all the forums on this topic here and came up with nothing...

Recently over the past few years the FDIC has come down hard on banks and privately owned ATMs. They’re want us to do detailed EDD which goes deeper into having to ask the customer's for their dr/cr journals on the machines. If we're fortunate enough to get those documents they want us to calculate percentages of fees vs what goes in and come out of the machine.
My probably with this is none of this is "in writing" per say and seems the examiner makes it more something they want to see. In my thinking, if you don’t have it in writing I’m not doing it per say just to appease an auditor. Generally, in the past, monitoring ATM's was simple as having a designated ATM account and reviewing the debits/credits of the account. Also you would get a contract agreement or something of sorts.

Does anyone else have to do this?

How do you monitor your ATM accounts?

I second this request... Recently became aware that a customer has an on-site ATM that they own and replenish cash of varying amounts and frequency from store proceeds. But all deposits go to their main operating account at another bank along with the deposits for all their other locations. If we request a separate account at our bank for just those deposits we'll most likely lose the account. If we asked for the last three months statements of the other account, we most likely won't be able to differentiate between locations. If we ask for a breakdown of deposits from their processor for just that location, we're still only relying on their stated replenishment volumes to match to the deposits from the processor since they don't actually do a withdrawal specifically for replenishing their ATM. We feel like the business is low risk for any money laundering concerns but how do we document this? Will examiners be ok with just our gut feeling because they've been a customer for 15 years? What level of documentation is sufficient but not overkill and running customers off from their accounts at community banks?

Will examiners be satisfied with your gut feeling, even for a 15-year customer? Not likely. Examiners aren't big on character witnesses. Bankers I have corresponded with agree that without the complete banking packing in your bank, your monitoring for the ATM activity just isn't going to be worth much.

This may be a case where you have to pull the customer all-in or let it go.

To answer the first 2 posts, in my opinion if the account with your bank is used only for the ATM and all other business activity goes to an account at another bank I would insist on cash withdrawals to agree with the ACH credits for the ATM usage and there would not be any room for negotiation. If the account with your bank has all of their business activity you would need to feel comfortable with the customer's ability to receive enough good quality $20 bills in their normal course of business to replenish the ATM and this is where it gets tricky. A site visit would certainly help.

Are there any suggestions for how this can be done if the account is at another institution?

My clients do all their business here and we don't have to deal with another bank.

Most of the banks that I deal with when it comes to the typical MSBs, private ATMs, etc., its an all or none proposition.

I understand its an all or none thing and we do treat them as MSB's. What I want to know is how do you monitor/review them?

Private ATMs are of interest because of the ease they present for laundering money. Your gut feeling won't convince an auditor or examiner that the customer is not laundering money.

Why do you feel it is low risk for laundering? It is actually a great way to launder funds, hence the interest.

You will have to show that the dollars make sense. Is there sufficient traffic in the location to support the alleged funds for the ATM? Does the business itself generate the funds that are going through the ATM? Those are the types of thought patterns you have to walk through. If you are willing to allow some accounts at another bank, condition that on copies of statements. Sure they can be faked, but it is at least an attempt to get your arms around the situation, versus trying to defend a gut feel.

Like you do any high risk customer. You look at all inflows and look at all outflows and determine reasonableness based on type of business, business model and expected activity.

If they run a small mom and pop convenience store and they have $100,000 a month in ATM ACH credits posting to their account and have a ATM that dispenses only $20s and they don't get a single $20 bill from the bank, then they better have enough retail volume to generate $100,000 in $20 or you have an issue.

I do treat them like any other high risk customers and monitor the dr/cr flows. However I am asking does anyone else have to get statements from them and calculated ratios/percentages for your auditor?

As indicated in the responses, what you say you are doing is largely what is expected. What is being asked of you:



is largely ridiculous; it proves something between very little and nothing at all.

Consider the possibility that you are acting on the whims and implementing the personal opinions of a single examiner. I had one banker whose examiner thought the bank was required to verify that CDD information obtained at account inception was accurate for every customer.

Generally, all that can be done is that you say you're satisfied with your results and offer them the chance to write it up...it's better than chasing your tail to please one person.

Ken my opinion is right there with yours. Unfortunately I'm in the co-polite's role where I am and the Pilot is doing what that "one" examiner is asking for. My stance has always been what I'm doing now is sufficient and if they want more show it to me in FinCEN writing..

You're flying in the wrong jet. You might want to find a new airline if your pilot has no clue on how to land a plane.

Some advice for MBank: Having 2,500 hours flying AF jets, I'd advise never to fly a jet without a parachute.
Additionally, it's the copilot's job to save the pilot from doing stupid stuff and getting everyone killed. Just saying.

We require a copy of their bank statements from the other bank. Fortunately we only have one ATM owner where due to our branch locations, banks that account elsewhere.

While on the subject of Privately Owned ATMs - does anyone know if all privately owned ATMs have to be registered with the state they are located in?

This will vary by state law.

Call your state's department of banking/financial institutions. I called in one state and the best answer I could get out of them was "Not that I know of."

Then, I called an ATM vendor and asked the same question as if I was a prospective purchaser. The answer was an emphatic "No." Then I asked about an adjacent state where I was familiar with the requirements and got an emphatic "Yes" which I knew to be correct. That added some credibility to the previous "No."

This is priceless! I have over and over and its like talking to a brick wall... i'm jumping