I was reviewing the activity of a new MSB customer and noticed that they had cashed a $12,000 check. I called and asked the owner about CTR filing, and the owner told me that his previous bank told him he didn't have to file CTRs.

I'm doing a site visit today and taking a FinCEN brochure that outlines his responsibilities, including filing CTRs. Has anyone else run into this?

MSBs have their own BSA/AML reporting requirements, which is very similar to the banking standards. If your customer is filing the CTR on their end, the bank, as a intermediary, does not need to file another CTR. Why would you want to do their work and also create a duplicate workload? You should check with your customer if they have a reasonable AML program and procedures in place.

I usually avoid providing guidance to MSB customers. I would do exactly what you have planned. Drop off the documentation and suggest they check out FinCEN's website.

If you know they are not complying with the guidance, you need to make a business decision on how to handle the relationship.

I don't think that the question was about the bank's filing of CTRs. It was about verifying with the MSB that it was complying with the regulatory requirement that it file one.

If the bank comes to the conclusion that the MSB is failing to file CTRs, it should consider whether to file a SAR on the MSB, even though its failure to do so is not in any way related to the bank.

Wouldn't the filed form be the FinCEN Form 8300 / IRS Form 8300, Report of Cash Payments Over $10,000 Received in a Trade or Business?

Yes, John and ACBbank, that was the question. While on site, I made a copy of his check cashing procedures which was highlighted to not cash checks over $10,000 or an IRS form was required, lol.

He seemed to understand, so I will monitor it going forward.

John - I know that an MSB not being registered is something we would file a SAR on. Is there any reading I could provide to my SAR committee about filing a SAR when other portions of regulatory requirement is not being followed(i.e. CTRs)?

That's not correct. There's no "waiver" and a bank would have no way of verifying prior reporting anyway.



No. An MSB is a financial institution (albeit a non-bank financial institution) and it files Form 104.