I've spoken with the FinCEN hotline and was told that since the checks were endorsed over to the business owner, HE was the only person to be listed as the beneficiary (and transactor). If I wrote a $12,000 check to Bob Smith and he in turn endorsed it over and gave it to me to cash at my institution for him, there is no proof that it really is for Bob. I'm signing for the cash, therefore I am the beneficiary as far as the CTR is concerned.
I do agree, however, that this is a bit odd. We have several small business customers that do this for their two or three employees and it never amounts to more than a couple thousand dollars, so it's never been a real issue for us.
My opinions do not necessarily reflect those of my employer.