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#1592490 - 08/16/11 06:18 PM Structuring - Notice to Customers
Dallas Fan Offline
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If you suspect someone is possibly structuring can you provide them with the FinCEN handout entitled -
Notice to Customers: A CTR Reference Guide?

I recently heard an argument that maybe the individual (customer) has deposited $9,900 due to the fact that last time they deposited over 10K they had to wait and answer questions due to the filing of the CTR. Maybe the customer does not know that what they are doing is illegal and they are just trying to save time.

The law states the following: “No person shall, for the purpose of evading the reporting requirements [of the BSA], structure or assist in structuring . . . any transaction with one or more domestic financial institutions.”

I guess the key is "for the purpose of evading."

Not sure I buy the argument but I supopose it is plausible. Any thoughts appreciated.

Thanks

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#1592497 - 08/16/11 06:30 PM Re: Structuring - Notice to Customers Dallas Fan
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Yes, you can provide them with the FinCEN handout.
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#1592533 - 08/16/11 07:24 PM Re: Structuring - Notice to Customers ACBbank
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FinCEN created the handout specifically to help banks address situations similar to what you posted.
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#1592534 - 08/16/11 07:25 PM Re: Structuring - Notice to Customers ACBbank
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That is why FinCEN created that brochure, though I find it comical that we would actually advise someone on how to structure and that it is illegal. But yea, you are safe to distribute that brochure.
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#1592564 - 08/16/11 07:55 PM Re: Structuring - Notice to Customers J2C
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Frankly I wish they would just use a more "plain English" brochure that says something along the lines of:

Quote:
Look - If you intentionally deposit less than $10,000 to avoid a CTR, we're going to know it and will be forced to file a much more sinister report on you so KNOCK IT OFF ALREADY!
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#1592590 - 08/16/11 08:17 PM Re: Structuring - Notice to Customers Princess Romeo
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grin

Like!

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#1592699 - 08/16/11 10:35 PM Re: Structuring - Notice to Customers kw004h
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LOL!

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#1592979 - 08/17/11 04:55 PM Re: Structuring - Notice to Customers Underthebus
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Has any BOL'ers mass mailed the notice to all customers via stmt stuffers? We've instructed our front-line over & over again to provide this notice in these situations and to inform us of the action so we can document it. If the customer transacts his future cash activity in the same manner again, then we know that he/she was deliberately evading the reporting requirement. But instead of giving the notice, the front-line will report the repeated activity to the BSA dept.
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#1593415 - 08/18/11 01:22 PM Re: Structuring - Notice to Customers AnnRoy
Elwood P. Dowd Offline
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I would question the cost effectiveness of mailing the pamphlet to all customers as only a minute portion of them would have reportable transactions. On the other hand, sending it as a statement stuffer to all cash intensive customers on an annual basis might be prudent.

If you record the dates it is distributed each year you can recap that information in any structuring related SARs you file.
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#1593651 - 08/18/11 04:44 PM Re: Structuring - Notice to Customers Elwood P. Dowd
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Originally Posted By: Ken_Pegasus
I would question the cost effectiveness of mailing the pamphlet to all customers as only a minute portion of them would have reportable transactions. On the other hand, sending it as a statement stuffer to all cash intensive customers on an annual basis might be prudent.
If you record the dates it is distributed each year you can recap that information in any structuring related SARs you file.


When I brought up mailing the pamphlet to our customers who may or may not be structuring, both the OCC and IA advised against it. They felt unless every customer gets one, we could be advising the customer's on how to make their deposits or withdrawals. Any thoughts on this?
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#1593658 - 08/18/11 04:51 PM Re: Structuring - Notice to Customers ACBbank
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I would fear that a general mailing might result in an increase in structuring because customers that were not aware of the reporting become aware and think they can beat the system by going to different branches, etc.
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#1593664 - 08/18/11 04:55 PM Re: Structuring - Notice to Customers ACBbank
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I'm not surprised that OCC would advise against it. Before the FinCEN pamphlet, there was a privately produced pamphlet about the CTR reporting requirements. OCC also advised against that saying it was advising customers on how to avoid CTRs. However, the same basic information is available to anybody who wants to read the regulations. The OCC website is one place where anyone can go and read those regulations. The private pamphlet was endorsed by the ABA and the FinCEN pamphlet is produced by the agency ultimately charged with enforcement of the BSA. OCC only enforces BSA rules because that authority was delegated to the agency by FinCEN. If there was something sinister about it, do you think FinCEN would make it available for banks to give to customers. Common sense dictates that you would give it to the people most likely to structure, not your every day Joe who probably only wishes he had enough cash to structure his deposits. (Rant for the day.)
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#1593670 - 08/18/11 04:59 PM Re: Structuring - Notice to Customers ACBbank
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Frankly, I've heard field examiners from each of the bank regulatory agencies grumble about the pamphlet since the day it was published. Whatever their individual opinions might be, the OCC itself has not said that banks should not distribute the pamphlet.

Since it's FinCEN's regulations that prohibit assisting in structuring and its FinCEN's pamphlet, any argument that its distribution constitutes assisting in structuring simply doesn't hold water.
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#1593671 - 08/18/11 04:59 PM Re: Structuring - Notice to Customers Retread
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I agree with you Retread. However, this one just one of those battles I didn't feel was worth the effort.
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#1593828 - 08/18/11 06:44 PM Re: Structuring - Notice to Customers ACBbank
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IMHO - I think you should call FinCEN and give them the name of the examiner and his or her field office supervisor that is telling you not to use the pamphlet and ask if they have any recommendations for you. If possible, see if they will e-mail that information to you.
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#1596545 - 08/25/11 05:03 PM Re: Structuring - Notice to Customers J2C
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Originally Posted By: jennyfromthebloc
That is why FinCEN created that brochure, though I find it comical that we would actually advise someone on how to structure and that it is illegal. But yea, you are safe to distribute that brochure.


This has been my experience here. They ask about CTRs and the tellers give them the brochure and asks them to read it. They even point out the section that says it's a federal offense and punishable by fine and prison time. THEN - the customer proceeds to structure because the brochure just told them how to do it. It's a catch-22 in my opinion.
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#1600524 - 09/07/11 04:25 PM Re: Structuring - Notice to Customers CantBeShocked
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To be quite honest, I think it produces more questions than answers. It basically 'tells' you how to structure, so we don't mass mail and don't even have it on hand at the branches.

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#1600606 - 09/07/11 06:17 PM Re: Structuring - Notice to Customers newbietoo
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Originally Posted By: newbietoo
To be quite honest, I think it produces more questions than answers. It basically 'tells' you how to structure, so we don't mass mail and don't even have it on hand at the branches.


Hence my suggestion for the more plain language approach!
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#1600647 - 09/07/11 07:07 PM Re: Structuring - Notice to Customers Princess Romeo
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We keep it on hand at branches so that staff can hand it to an inquiring customer rather than get into a conversation about structuring. To us, if someone (or something) is going to advise the customer on structuring, we'd rather it be FinCEN's brochure than our staff.

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#1600654 - 09/07/11 07:12 PM Re: Structuring - Notice to Customers banker bee
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Originally Posted By: bethel41
We keep it on hand at branches so that staff can hand it to an inquiring customer rather than get into a conversation about structuring. To us, if someone (or something) is going to advise the customer on structuring, we'd rather it be FinCEN's brochure than our staff.


Exactly. The bank may not enter into conversations about reporting/structuring.

In my experience, the customers already knew how to structure..they ask questions to confirm. There are rumors, old wives tales, websites that all revolve around the $10,000 limit.

The brochure puts them on notice that it is against the law, that there are fines and penalties including imprisonment and tells them that if they structure another report (unnamed) may be filed.

They can't say they weren't told and didn't know what they were doing.
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#1678246 - 03/15/12 07:19 PM Re: Structuring - Notice to Customers Dallas Fan
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A question related to this topic from last year: does anyone send an accompanying in-house produced letter of their own with the Brochure (i.e. something that basically instructs them to see the accompanying Brochure and provides a name of someone they can contact at the Bank if they have questions)? If so, does, or should, that Letter contain specific examples of transactions that the customer actually conducted so that they will know what "triggered" the Letter? It seems that just mailing the Brochure to them with no explanation may cause some confusion, especially if the person truly wasn't structuring.

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#1678419 - 03/15/12 11:49 PM Re: Structuring - Notice to Customers Dallas Fan
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I would not touch a letter like that with a ten-foot pole and I can guarantee that your legal counsel would not either. If the customer has questions, the customer should contact their own legal counsel and not the bank.
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#1678454 - 03/16/12 10:51 AM Re: Structuring - Notice to Customers Dallas Fan
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I agree with rlacary except for one thing. Where he says "I can guarantee that your legal counsel would not either", I would change that to say "competent legal counsel". Remember, some bank attorneys have no problem disclosing SARs.

In reference to explaining structuring to customers, the less you try to explain verbally, the better. Too much explanation can be dangerous.
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#1678539 - 03/16/12 01:50 PM Re: Structuring - Notice to Customers Dallas Fan
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We have trained our tellers that when someone makes a large cash deposit, usually between $9,000 and $9,900 for example, OR if they have started seeing a pattern of cash deposited that indicates the customer is avoiding a CTR, they should provide the customer with the brochure and tell the customer "Here is some information that we give ALL our customers that make large cash transactions. If you have questions, our Branch Manager will be happy to review this with you." The Branch Managers are also instructed to only review the information in the brochure and not engage in any other discussion. Notifying the customer that their activity is illegal is a key point with law enforcement. We put a note on the account when the brochure has been provided and then any subsequent activity indicates "intent". We recently were involved in a case involving structuring where a Non-customer was cashing on-us checks but he was assisted in structuring by our customer who was issuing the checks. A key point in the trial was that the non-customer had been provided the brochure and a copy of the brochure was even entered in as evidence. This guy was found guilty on 70 out of 85 counts of structuring even though the funds were legit. He is awaiting sentencing now.

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#1678617 - 03/16/12 03:01 PM Re: Structuring - Notice to Customers AML247
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Originally Posted By: Nu2BSA
We have trained our tellers that when someone makes a large cash deposit, usually between $9,000 and $9,900 for example, OR if they have started seeing a pattern of cash deposited that indicates the customer is avoiding a CTR, they should provide the customer with the brochure and tell the customer "Here is some information that we give ALL our customers that make large cash transactions. If you have questions, our Branch Manager will be happy to review this with you." The Branch Managers are also instructed to only review the information in the brochure and not engage in any other discussion. Notifying the customer that their activity is illegal is a key point with law enforcement. We put a note on the account when the brochure has been provided and then any subsequent activity indicates "intent". We recently were involved in a case involving structuring where a Non-customer was cashing on-us checks but he was assisted in structuring by our customer who was issuing the checks. A key point in the trial was that the non-customer had been provided the brochure and a copy of the brochure was even entered in as evidence. This guy was found guilty on 70 out of 85 counts of structuring even though the funds were legit. He is awaiting sentencing now.


Sounds like a good policy. You are right about the "intent" part. We have been repeatedly told by law enforcement that customer receipt of the brochure is important evidence.
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