Skip to content
GeoDataVision
Thread Options
#1897536 - 02/14/14 08:30 PM Cash Deposits
BAY Offline
100 Club
Joined: Jan 2006
Posts: 145
I've heard that some banks are no longer accepting cash deposits into an account unless the depositor is a signor on the account. I'm not quite understanding why that would be the case. I can see setting a threshold for AML and KYC purposes (ie...you cannot deposit more than X in cash if you are not on the account)...but I'm having problems with the smaller dollar amounts such as parents depositing into students account. Can anyone elaborate.

Return to Top
Deposits and Payments
#1897562 - 02/14/14 09:09 PM Re: Cash Deposits BAY
BrianC Online
Power Poster
BrianC
Joined: Nov 2004
Posts: 6,316
Illinois
This is purely a risk based decision some banks have chosen to make. It doesn't mean that yours has to follow suit.
_________________________
Sola Gratia, Sola Fides, Sola Scriptura, Solus Christus, Soli Deo Gloria!
www.tcaregs.com

Return to Top
#1897566 - 02/14/14 09:12 PM Re: Cash Deposits BAY
Elwood P. Dowd Offline
10K Club
Elwood P. Dowd
Joined: Aug 2001
Posts: 21,939
Next to Harvey
This thread from the BSA Forum discusses the HSBC changes, but it also links to the Chase thread which has apparently spurred your actions.

To start: I know nothing about your bank or your clientele...

In my opinion, requiring ID on small amounts of cash is nothing short of silly. Instituting a threshold of $2500 or $3000 will generate enough pushback as it is. If I was the CEO and a BSA officer came to me with the $2500 to $3,000 idea, I would ask for some statistics to demonstrate that it had value and was something more than a stunt.

For example, look at cash transactions in the last 30 days and tell me 1) how many times you would have required people to produce ID and 2) how many CTRs would have been affected; i.e. how many additional CTRs would we have filed and how many CTRs would have been filed for different amounts.
_________________________
In this world you must be oh so smart or oh so pleasant. Well, for years I was smart. I recommend pleasant.

Return to Top
#1897669 - 02/16/14 12:21 AM Re: Cash Deposits BAY
John Burnett Offline
10K Club
John Burnett
Joined: Oct 2000
Posts: 39,684
Cape Cod
Do a Google search on "cuckoo smurfing." It will give background on one sort of money laundering that involves third-party cash deposits.
_________________________
John S. Burnett
BankersOnline.com
Fighting for Compliance since 1976
Bankers' Threads User #8

Return to Top
#1898057 - 02/19/14 12:23 AM Re: Cash Deposits BAY
Princess Romeo Offline

Power Poster
Princess Romeo
Joined: Jun 2001
Posts: 8,272
Where the heart is
Originally Posted By: BAY
I've heard that some banks are no longer accepting cash deposits into an account unless the depositor is a signor on the account. I'm not quite understanding why that would be the case. I can see setting a threshold for AML and KYC purposes (ie...you cannot deposit more than X in cash if you are not on the account)...but I'm having problems with the smaller dollar amounts such as parents depositing into students account. Can anyone elaborate.


Yes I can see the concern from a micro-money laundering standpoint, but this all goes back to "Know Your Customer." If you KNOW these are parents that are depositing cash to their child's account, then you should document that in your records and set some thresholds where, if they start depositing thousand and thousands, you would investigate further.

In the case of a very large institutin, they may not be able to handle that kind of detail, but then again, they may push upon their branch managers to make sufficient inquiries to accomodate legitmate needs. Deposit alternatives might be to set up an online account where you can make a transfer to the child's account. That's what I had to do for my daughter, and there was a dollar limit on how much I could transfer on any given day.
_________________________
CRCM,CAMS
Regulations are a poor substitute for ethics.
Just sayin'

Return to Top
#1907859 - 03/22/14 12:04 AM Re: Cash Deposits BAY
TryingtoComply Offline
Diamond Poster
Joined: Apr 2013
Posts: 1,964
The West
We just had a situation where a reportable cash deposit was made to a business customer's account. The person making the deposit supposedly purchased product from them and was paying for it by making the deposit to their account. She was from out of the country so we obtained her passport etc. for the CTR.

This got me to thinking. Aside from the money laundering issues, what other issues could be associated with this type of activity that we should be concerned about? What if the deposit was not authorized?
_________________________
TryingToComply
CRCM

Return to Top
#1907864 - 03/22/14 11:49 AM Re: Cash Deposits BAY
rlcarey Offline
10K Club
rlcarey
Joined: Jul 2001
Posts: 79,628
Galveston, TX
What sort of products?
_________________________
The opinions expressed here should not be construed to be those of my employer: PPDocs.com

Return to Top
#1907916 - 03/24/14 01:53 PM Re: Cash Deposits BAY
Mike Baker Offline
100 Club
Mike Baker
Joined: Dec 2002
Posts: 192
Tennessee
Question: What types of liability issues arise from accepting the deposit? Was there any type of agreement with the account holder whereby someone who is not an authorized signer could make such a deposit, either on a one time or continuing basis?
With regard to processing the transaction...even if a receipt is not provided to the customer which shows the account balance, would just the fact that the transaction was accepted provide acknowledgment that the account number is legitimate, potentially violating privacy, and thereby opening the door to possible future fraudulent transactions [e.g. unauthorized electronic debits to the account]? That is, how can we be sure tha the party making the deposit obtained the account number with the account holder's permission and consent?
Granted, this matter could be taken to ridiculous extremes, but I think that in the particular situation described by "TryingtoComply" there are a number of potential red flags.
_________________________
"When you believe He's all you need,that will be your defining moment." [from "Defining Moment" Newsong, Sheltering Tree CD]

Return to Top
#1925026 - 05/20/14 09:49 PM Re: Cash Deposits BAY
cody_c Offline
Member
cody_c
Joined: Jan 2012
Posts: 53
Nebraska
What is the difference between accepting a deposit at the teller line with cash or a night deposit bag full of cash? In both cases the depositor legitimate or illegitimate knows the account number to deposit to.
_________________________
The opinions expressed are mine and do not necessarily reflect those of my employer.

Return to Top

Moderator:  John Burnett