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#1299374 - 12/04/09 09:15 PM Phase II Exemption problem
goneyard Offline
New Poster
Joined: Jan 2006
Posts: 23
Mid USA
Here's my situation.....

Reviewing BSA and found that an exemption has been filed for an account that is not yet eligible. How should we handle this?

Account had been opened for the required 12 months, but had not reached the minimum threshhold of "frequent" reportable transactions (which was 8 per year and is now 5 per year).

What should I do? I assume that I need to withdraw the exemption? Have never been faced with this before; does anyone know that process?

Now it gets uglier...since the exemption was filed, there were two instances where the incorrectly exempt business would have had reportable transactions exceeding $10,000. Of course they were not reported due to the exemption. After I withdraw the exemption, I assume we need to go back and report these transactions that should have had CTR's, even though they are now late?

Any thoughts or suggestions would be sincerely appreciated...I'm sure I'll get the old "Well, it's good that you caught it yourself, but it is a violation" from the examiners.

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#1299451 - 12/04/09 09:49 PM Re: Phase II Exemption problem goneyard
Elwood P. Dowd Offline
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Elwood P. Dowd
Joined: Aug 2001
Posts: 21,939
Next to Harvey
You need a backfiling determination. Prior thread.
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#1299802 - 12/07/09 03:10 PM Re: Phase II Exemption problem Elwood P. Dowd
goneyard Offline
New Poster
Joined: Jan 2006
Posts: 23
Mid USA
OK, Ken....thanks.

I understand about the backfiling determination...but how about the exemption? How do I go about withdrawing the exemption, which is what I assume needs done?

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#1301680 - 12/09/09 04:01 PM Re: Phase II Exemption problem goneyard
nemsi Offline
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Joined: Nov 2005
Posts: 383
I would file CTRs on any reportable transactions occurring within the last 15 days (25 if you're efiling). Once you start filing the CTRs the exemption is revoked but you can use the form 110 to revoke the exemption if you want a copy for your records. Have you contacted Detroit about a backfiling determination? i would get the ball rolling on that, it may be fairly simple to correct but you wont know until you talk to them. once you've taken care of the backfiling and filed the required 5 CTRs you can exempt this customer.

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