Here's the situation- A customer purchases a large cashier check with a closing withdrawal from his savings account. Every so often he will redeem the cashier check, deposit a small amt in his checking, take an even smaller amount in cash and purchase another cashier check. He does this numerous times. To me this appears to be like he is using the cashier checks as savings. Does this warrant a SAR? Is this illegal? I don't know the reason he is doing it but I do feel like he just is holding the money. Thanks for any advice.

Yes, this is called "rolling a cashiers check" and is a method to hide money. We would file a SAR.

We have added policies which don't allow this. If he has an account we require him to run the cashiers check through his account to purchase the new one to leave a paper trail. If he is not an account holder we would have him cash the full amount of the check and don't allow him to purchase another.

We had almost an identical situation and filed a SAR.

Thanks for the input.

Ok, as I started to research further, the customer does appear to run the cashier checks through his account, less cash which actually is only a small amount of cash and the rest purchases another cashier check, with depositing a small amount in the checking acount as well. Knowing this, would this still warrant a SAR?

Has anyone actually taken the time to talk to this customer and ask him about these transactions? It almost sounds like someone who does not trust banks right now and doesn't want to keep his savings in a bank. Instead of the old "cash under the mattress" solution or keeping loads of cash in a safety deposit box, he chooses to keep it in a cashier's check and these transactions are his withdrawals from savings.

It sounds like someone might want to have a conversation with this gentleman. If he's worried about the bank being shut down, holding a cashier's check issued by the bank would not necessarily make things safer or easier on him.

I personally feel that a SAR is not yet warranted, but that's just based on the information you gave. Based on that, I don't think he's trying to hide any money, this is just his way of having his money with him (instead of in the bank) at all times.

But I would definitely document everything, have someone at the branch talk to the customer, and keep a file. As soon as the behavior crosses into "suspicious" territory (or his explanation is suspicious), I would file.

Actually, when I first got into this, that was my first thought. That he was using the Cashier Check as a Savings per say. I will defintiely get an officer to talk to him and see what his thought process is concerning this. Thanks for all the answers.

I just found out it was to keep the money from his wife so she won't spend it, which is not illegal just weird. So based on all of this, I do not think I need to file a SAR. Am I correct?

There really isn't a "yes" or "no" response. You're correct in your assumption about hiding assets from his spouse. I don't believe that is in fact illegal. However, this transaction is unusual. Given the customer's response, do you feel the transaction(s) is/are suspicious? During your research of the account(s), were there any other transaction(s), which when combined with the aforementioned ones, make this seem suspicious? If so, file the SAR. If not, do not file the SAR.

Either way make sure to document your rationale for whatever course of action you take. This is my opinion, but I don't think that most regulators would have an issue with you not filing in this particular case.

I agree with ACB. Take a look at the whole picture with this customer. If you decide not to file, document the heck out of it. In my experience, as long as you have documentation and a valid explanation for not filing, it's unlikely the examiners will hold that against you.

Smart gut...I'm surprised more guys do not do this!

I had a guy that hid boxes of coin in his attic to keep money away from his wife. That was his saving- $100 a paycheck.

There's a difference between harmless stupidity and malicious stupdity. Sometimes, its a fine line. This sounds like harmless stupidity to me. Just have a talk with him, and see if there is a less stupid way to accomplish his goals.