Skip to content
BOL Conferences
Page 1 of 2 1 2
Thread Options
#1908238 - 03/25/14 12:36 PM Structuring
Retread Offline
Power Poster
Retread
Joined: Oct 2003
Posts: 2,548
Southeast
Here is an interesting article on structuring.

Structuring
_________________________
Politicians are like diapers. They need to be changed often and for the same reason.

Return to Top
BSA/AML/CIP/OFAC Forum
#1908243 - 03/25/14 01:01 PM Re: Structuring Retread
Xian Ngyuen Offline
100 Club
Joined: Aug 2013
Posts: 221
"Interesting" is the correct word, for sure.

Return to Top
#1908247 - 03/25/14 01:11 PM Re: Structuring Retread
ACBbank Offline
Power Poster
ACBbank
Joined: Jul 2006
Posts: 4,344
New York City
I think this is why a lot of executives don't like BSA (besides the associated costs). I remember when things changed after 9/11 and the intent was to go after drug dealers and terrorists. Once IRS-CI realized that SAR data was a treasure trove for potential tax evasion, things took a turn for the worst.

Maybe there is more to the cases referenced, maybe not.
_________________________
"100 victories in 100 battles isnt the most skillful. Subduing the other's military w/o battle is the most skillful." Sun-Tzu

Return to Top
#1908305 - 03/25/14 02:24 PM Re: Structuring Retread
Elwood P. Dowd Offline
10K Club
Elwood P. Dowd
Joined: Aug 2001
Posts: 21,939
Next to Harvey
Half right and half baked.
_________________________
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
#1908485 - 03/25/14 06:40 PM Brilliant article on smurfing laws
MB Guy Offline
10K Club
Joined: May 2004
Posts: 10,124
Way, way south.
Snip

All of this brings me to United States v. Abair, a case from the Seventh Circuit Court of Appeals that my fellow Washington Post blogger Eugene Volokh posted about last week. Yulia Abair, an immigrant from Russia, was trying to close on a house. When her bank in Russia wouldn’t wire her the money for her deposit, she instead made a series of withdrawals from that account from ATMs, then deposited the cash in her domestic bank account. The question is whether she deliberately made several deposits of less than $10,000 to avoid having those deposits reported, or if she simply didn’t know about the reporting law. To show that Abair made the deposits willingly, prosecutors brought up unrelated issues about whether she had ever lied on a tax form or student loan application. Because the crime turns on intent, it’s easy to see how these trials could devolve into judgments on a defendant’s general character. Abair was convicted, sentenced to two years probation, and was ordered to sell her new home and turn all proceeds over to the federal government. (Welcome to America!)

The Seventh Circuit did reverse her conviction, but only because it found that the prosecutor improperly brought up the questions about her taxes and loan application. The court didn’t question the law itself. As Volokh notes, even the dissenting judge wrote, “[T]his case shows every sign of being an overzealous prosecution for a technical violation of a criminal regulatory statute — the kind of rigid and severe exercise of law-enforcement discretion that would make Inspector Javert proud.”

snip

http://www.washingtonpost.com/news/the-w...f2-a6f9e9d79e19
_________________________
Giddy up.

Return to Top
#1908528 - 03/25/14 07:29 PM Re: Brilliant article on smurfing laws MB Guy
Retread Offline
Power Poster
Retread
Joined: Oct 2003
Posts: 2,548
Southeast
Here is the case that MB Guy referred to.

Abair
_________________________
Politicians are like diapers. They need to be changed often and for the same reason.

Return to Top
#1908539 - 03/25/14 07:44 PM Re: Brilliant article on smurfing laws Retread
MyBrainHurts Offline
Platinum Poster
Joined: Feb 2010
Posts: 960
Illinois
I think it's a good basic explanation of structuring, and I just sent the link to all staff. In my email message, I highlighted the sentence, "Bank personnel found to have neglected their duties to report suspicious customer behavior can also be criminally charged and sent to prison."

We had a customer withdraw $9,000 on each of three consecutive days. I saw it in our monitoring system, but do you think the teller might have picked up the phone and let me know? Nah.
_________________________
I thought getting old would take longer.

Return to Top
#1908541 - 03/25/14 07:45 PM Re: Brilliant article on smurfing laws Retread
raitchjay Online
Power Poster
Joined: Oct 2009
Posts: 9,088
OK
It does seem a bit beyond the intent of BSA/AML that 'structuring' (with no actual criminal activity behind the making of the money involved) itself is a felony.
_________________________
I'm fixin' to fix that.

Return to Top
#1908547 - 03/25/14 07:47 PM Re: Brilliant article on smurfing laws Retread
raitchjay Online
Power Poster
Joined: Oct 2009
Posts: 9,088
OK
If I make $9000 a month in cash legally, and deposit that into my checking account each month, i'm guilty of structuring? (Not trying to be sarcastic...i'm not a BSA guy and that's what this article seems to imply.)
Last edited by raitchjay; 03/25/14 07:48 PM.
_________________________
I'm fixin' to fix that.

Return to Top
#1908560 - 03/25/14 08:09 PM Re: Brilliant article on smurfing laws raitchjay
Liz O Offline
Junior Member
Joined: Dec 2012
Posts: 47
Boston, Massachusetts
It's not necessarily that you are "guilty of structuring". It is more that if the bank sees it and does not file a SAR for structuring, then they are not covering themselves in the event that you are being investigated by the government and a case is brought to court. It's not the bank's job to determine your guilt. Just to report if the activity appears suspicious. Since a case could be made that you MIGHT be structuring, it would be in the bank's best interests to file a SAR. Determining whether or not you're guilty of structuring is law enforcement's job.

At least that's what I've been taught. Good or bad, right or wrong, the bank is trying to protect themselves from risk.
_________________________
CAMS

*The postings on this site are my own and do not reflect the views of my employer.*

Return to Top
#1908564 - 03/25/14 08:16 PM Re: Brilliant article on smurfing laws Retread
raitchjay Online
Power Poster
Joined: Oct 2009
Posts: 9,088
OK
Thanks for the explanation Liz.
_________________________
I'm fixin' to fix that.

Return to Top
#1908567 - 03/25/14 08:25 PM Re: Brilliant article on smurfing laws Retread
raitchjay Online
Power Poster
Joined: Oct 2009
Posts: 9,088
OK
One more question: in my scenario, the bank would/should fil a SAR..........or would/should file a SAR once they've investigated (maybe asking me about the situation) and determined that there's not a legitimate reason why i'm consistently depositing money close to the threshold amount?
_________________________
I'm fixin' to fix that.

Return to Top
#1908569 - 03/25/14 08:34 PM Re: Brilliant article on smurfing laws Retread
raitchjay Online
Power Poster
Joined: Oct 2009
Posts: 9,088
OK

To put it another way: is depositing $9,000 or $9,500 or somewhere in between pretty regularly by itself "suspicious" activity that pretty much mandates a bank to file a SAR (to protect itself, as you say) or is it "suspicious", but doesn't have to lead to immediate SAR filing, but merely to more investigation, which might lead to no SAR being filed because the activity (in this case) can be seen to be reasonable based on the facts of my situation?
_________________________
I'm fixin' to fix that.

Return to Top
#1908570 - 03/25/14 08:35 PM Re: Brilliant article on smurfing laws Retread
ACBbank Offline
Power Poster
ACBbank
Joined: Jul 2006
Posts: 4,344
New York City
^ Investigative techniques vary from FI to FI. A onetime deposit of $9,000 in cash, in and of itself wouldn't warrant a call or SAR in most cases.

Multiple cash deposits/withdrawals near $10,000 are going to warrant some kind of investigation and explanation. The results of the investigation will determine whether the activity is suspicious and warrants an SAR filing.
Last edited by ACBbank; 03/25/14 08:37 PM. Reason: Just saw your most recent posts
_________________________
"100 victories in 100 battles isnt the most skillful. Subduing the other's military w/o battle is the most skillful." Sun-Tzu

Return to Top
#1908575 - 03/25/14 08:42 PM Re: Brilliant article on smurfing laws Retread
raitchjay Online
Power Poster
Joined: Oct 2009
Posts: 9,088
OK
Thanks ACB. I just know if i was the person in that scenario, i'd want the opportunity to explain my legitimate cash deposits. Again, thanks for the further explanation.
Last edited by raitchjay; 03/25/14 08:43 PM. Reason: accidental transposition
_________________________
I'm fixin' to fix that.

Return to Top
#1908584 - 03/25/14 09:18 PM Re: Structuring Retread
Big Dog Offline
Power Poster
Big Dog
Joined: Mar 2005
Posts: 2,659
Kennel
Ask for an explanation. if they say "I get paid once a month in cash and i get $9,000 - why would you file a SAR? It would seem reasonable to deposit their earnings. document their occupation/employer, any other information gathered, and move on. If they say "none of your business", then it is up to you to determine if the activity is suspicious.
_________________________
CAMS, AMLP, AKC, K-9






Return to Top
#1908661 - 03/26/14 01:49 PM Re: Structuring Big Dog
Retread Offline
Power Poster
Retread
Joined: Oct 2003
Posts: 2,548
Southeast
I agree that you should investigate and talk with the customer if you need an explanation. There are many legitimate reasons to make cash deposits of less than $10,000. One former customer explained to us that his insurance would not cover him if his cash on hand exceeded $10,000, so when his cash on hand got near $10,000, he would bring most of it to the bank, keeping enough to make change. That could range from once every few days to once a week or less depending on his cash business. Also, the sneaky ones may bring you $9,000 on one day and $2,000 two days later (for example). Once may not be a concern, but when it becomes a pattern, the apparent intent is to avoid the CTR filings. Also, most customers do not understand that if the bank files a CTR, it is only one of millions filed every year that rarely catch anybody's attention. By contrast, a SAR is much more likely to catch law enforcement's attention. In an attempt to hide their money by avoiding a CTR, they are only drawing attention to themselves and becoming the subjects of a SARs.
_________________________
Politicians are like diapers. They need to be changed often and for the same reason.

Return to Top
#1908668 - 03/26/14 02:06 PM Re: Structuring Retread
ACBbank Offline
Power Poster
ACBbank
Joined: Jul 2006
Posts: 4,344
New York City
^ Agreed. I think a number of customers who end up as the subject of SAR filings are doing it because they read something on the web or their attorney/accoutant avised them against making currency transactions in excess of $10,000.
_________________________
"100 victories in 100 battles isnt the most skillful. Subduing the other's military w/o battle is the most skillful." Sun-Tzu

Return to Top
#1909004 - 03/27/14 12:32 PM Re: Structuring Retread
yy2say Offline
Gold Star
yy2say
Joined: Apr 2002
Posts: 279
PA
I'm concerned ...are you talking about discussing SAR filing with the customer?
_________________________
"Go, Dog. Go!" ~ P.D. Eastman

Return to Top
#1909020 - 03/27/14 01:08 PM Re: Structuring Retread
ACBbank Offline
Power Poster
ACBbank
Joined: Jul 2006
Posts: 4,344
New York City
^ No. You should never discuss a SAR or potential SAR with a customer. I believe Retread was referring to speaking to the customer about the actual transactions to try and determine if there is a legitimate purpose behind them.
_________________________
"100 victories in 100 battles isnt the most skillful. Subduing the other's military w/o battle is the most skillful." Sun-Tzu

Return to Top
#1909026 - 03/27/14 01:12 PM Re: Structuring ACBbank
Elwood P. Dowd Offline
10K Club
Elwood P. Dowd
Joined: Aug 2001
Posts: 21,939
Next to Harvey
"Talking to the customer..." means a conversation about what he is doing, not what you are going to do in response. The customer always knows what's going on and there is no harm in saying that you also want to know too.

The conversation may result in a more detailed, less speculative SAR or no SAR at all.
_________________________
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
#1909162 - 03/27/14 03:38 PM Re: Structuring Retread
MrsSmithCRCM Offline
100 Club
MrsSmithCRCM
Joined: Dec 2012
Posts: 169
Here for the moment
Am I the only person that thought the article was misleading? The first few paragraphs don't mention that the deposits must be cash to even be considered.

Furthermore, depositing a large (CASH) amount once a month is much different than depositing a day or two days apart under 10K.

I think the author may have wanted to consult a BSA officer before writing about the topic. It doesn't sound to me like he has a thorough understanding of the intent or application.

Return to Top
#1909202 - 03/27/14 04:06 PM Re: Structuring Retread
John Burnett Offline
10K Club
John Burnett
Joined: Oct 2000
Posts: 40,086
Cape Cod
The press is notorious for misinformation on money laundering and related cases. My major "beef" about some of these cases is that it's likely that SARs have been filed without any attempt to understand what the customer is actually doing -- in other words, without the conversation that Ken alluded to. These are "defensive filings" of the worst kind, because they can lead to cases like some of the horror stories mentioned above.
_________________________
John S. Burnett
BankersOnline.com
Fighting for Compliance since 1976
Bankers' Threads User #8

Return to Top
#1909236 - 03/27/14 04:36 PM Re: Structuring MrsSmithCRCM
Elwood P. Dowd Offline
10K Club
Elwood P. Dowd
Joined: Aug 2001
Posts: 21,939
Next to Harvey
Quote:
Half right and half baked.


...was intended to indicate the article was stupid.
_________________________
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
#1909327 - 03/27/14 06:10 PM Re: Structuring MrsSmithCRCM
Retread Offline
Power Poster
Retread
Joined: Oct 2003
Posts: 2,548
Southeast
Why would the author consult a BSA Officer first? You wouldn't want to spoil an entertaining article with the facts. Surprisingly, there are a lot of people that believe any transaction over $10,000 has to be reported. I can't tell you how many wires and checks we saw that were just under $10,000 because the customer thought that would keep them from getting reported.
_________________________
Politicians are like diapers. They need to be changed often and for the same reason.

Return to Top
Page 1 of 2 1 2

Moderator:  Andy_Z