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#1391987 - 05/17/10 04:33 PM CTR Exemption Savings Account
Kathy Brooks Offline
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Kathy Brooks
Joined: Dec 2002
Posts: 95
Will one of you experts explain Federal Reserve Act's definition of transaction account Section 19 (b)(1) (C)'s statement " Such items includes...savings deposits subject to automatic transfers." An example might help me understand how a savings account might be CTR exempt. Thank you.
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#1392473 - 05/18/10 02:13 PM Re: CTR Exemption Savings Account Kathy Brooks
newbietoo Offline
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I'd be interested in the answer because we asked FinCEN sometime last year about savings accounts and they told us that savings accounts could not be exempted.

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#1392723 - 05/18/10 05:15 PM Re: CTR Exemption Savings Account newbietoo
nemsi Offline
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You would be exempting the customer and not the account. On a phase II exemption you can only exempt the transactions conducted through a "transaction" account-demand deposit or money market. A savings account is not a transaction account. That's my opinion. Others may disagree.

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#1392860 - 05/18/10 06:39 PM Re: CTR Exemption Savings Account nemsi
Kathy Brooks Offline
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Kathy Brooks
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nemsi-I agree, that is what I've always known it to be. But, when the language directs you to the definition I stated at the top I am lost on what it means (in bold) and can't say that I ever noticed it before now. What is 'savings deposits subject to automatic transfers'? And, would it also apply to Phase I?
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#1393199 - 05/19/10 01:41 PM Re: CTR Exemption Savings Account Kathy Brooks
John Burnett Offline
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Phase I exemptions cover all cash transactions of the exempt person, as long as they are not conducted on another person's behalf.

The restriction to transaction accounts only applies to Phase II exemptions.
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#1393211 - 05/19/10 01:49 PM Re: CTR Exemption Savings Account John Burnett
John Burnett Offline
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The reference to "savings accounts subject to automatic transfers" is to ATS accounts, which are interest-bearing savings accounts that are classified as transaction accounts because they have no monthly transfer caps. ATS accounts were the interim response to NOW accounts when NOW accounts were not permitted in most of the country. Although the justification for ATS accounts disappeared with the enactment of the Monetary Control Act of 1980, which authorized NOW accounts nationwide, some banks still offer ATS accounts.

ATS accounts are legally available only to individuals. Presumably, they can be used by sole proprietorships, and thus it's possible (unlikely, but possible) that one of your Phase II exempt customers could have one.
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John S. Burnett
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#1393295 - 05/19/10 02:48 PM Re: CTR Exemption Savings Account John Burnett
Kathy Brooks Offline
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Kathy Brooks
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Mr Burnett, thank you so much!
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#1393428 - 05/19/10 04:49 PM Re: CTR Exemption Savings Account Kathy Brooks
John Burnett Offline
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You are most welcome, Ms Brooks. Glad to be of help.
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