We are required to maintain a monetary instrument log for transaction between $3,000 and $10,000. Is there any provision that allows for exempting customers in this range or is the exemption only for eligible customers whose transactions are greater than $10,000?

The sale of monetary instruments for cash cannot be exempted. You can only exempt other eligible customers who maintain deposit accounts and whose cash transactions frequently exceed $10,000. FinCEN defines "frequently" as at least 8 times per year.

Phase I exempt persons are exempted from all CTR filings. But Phase II exempt persons are only exempted from CTR filings for large cash transactions in their exemptible accounts (transaction accounts and MMDAs used in connection with the business). Cash purchases of monetary instruments (unless conducted through the exemptible accounts) would not be exempt even if over $10,000, nor would cash loan payments or currency exchanges if over $10,000.

I agree with all of the above, but since the original question was about monetary instrument logs, the answer is that you cannot exempt anyone from the requirements to record information concerning the sale of monetary instruments for cash between $3,000 and $10,000. It makes no difference whether the customer purchases the instruments directly or deposits the money into an account that is subsequently debited to purchase the instruments.

The regulations require that you keep the information; the requirement that it be kept on a log was pointedly deleted several years ago. As John and Retread indicate there are no exemptions. Monetary instrument sales involving more than $10,000 in cash generate a reporting rather than a record retention requirement; those transactions are not "exempt," they are just not covered.

It is true that they did away with this "monetary log" requirement, however the requirement to retain the information still exists. Therefore most banks continued to use the same methods to document the information, i.e. the "monetary logs". Noone is exempt from the requirement to obtain and retain the information.

If we have a long-time customer purchase a Cashier's Check with $3000 - 10,000 cash, can we state "known customer" or "signature card on file" for verification of purchaser requirement on our Log?

You don't need to have a log but you do have to be able to reconstruct and retrieve information as if you do have one. As far as ID info goes, for an established deposit customer, if you have ID info on file either from your CIP efforts or from earlier ID records all you need to record is the account number, since that will lead to the ID info.

If however, your ID info is deficient, this is an opportunity to record it, keep it, and move on.

...and don't forget about FinCEN's ruling that the tracking is still required even if the customer deposits the cash into their account and then purchases the instrument of issue with a withdrawal.

See FinCEN Guidance
Monetary Instrument Recordkeeping

Thank you so much. The site was very easy to understand and now I have some training to do.