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#1908238 - 03/25/14 12:36 PM Structuring
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Here is an interesting article on structuring.

Structuring
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#1908243 - 03/25/14 01:01 PM Re: Structuring Retread
Xian Ngyuen Offline
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"Interesting" is the correct word, for sure.

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#1908247 - 03/25/14 01:11 PM Re: Structuring Retread
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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.
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#1908305 - 03/25/14 02:24 PM Re: Structuring Retread
Elwood P. Dowd Offline
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Half right and half baked.
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#1908485 - 03/25/14 06:40 PM Brilliant article on smurfing laws
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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 wouldnít 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 didnít 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, itís easy to see how these trials could devolve into judgments on a defendantís 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 didnít question the law itself. As Volokh notes, even the dissenting judge wrote, ď[T]his case shows every sign of being an overzealous prosecution for a technical violation of a criminal regulatory statute ó the kind of rigid and severe exercise of law-enforcement discretion that would make Inspector Javert proud.Ē

snip

http://www.washingtonpost.com/news/the-w...f2-a6f9e9d79e19
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#1908528 - 03/25/14 07:29 PM Re: Brilliant article on smurfing laws MB Guy
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Here is the case that MB Guy referred to.

Abair
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#1908539 - 03/25/14 07:44 PM Re: Brilliant article on smurfing laws Retread
MyBrainHurts Offline
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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.
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#1908541 - 03/25/14 07:45 PM Re: Brilliant article on smurfing laws Retread
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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.
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#1908547 - 03/25/14 07:47 PM Re: Brilliant article on smurfing laws Retread
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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.
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#1908560 - 03/25/14 08:09 PM Re: Brilliant article on smurfing laws raitchjay
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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.
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#1908564 - 03/25/14 08:16 PM Re: Brilliant article on smurfing laws Retread
raitchjay Offline
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Thanks for the explanation Liz.
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#1908567 - 03/25/14 08:25 PM Re: Brilliant article on smurfing laws Retread
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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?
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#1908569 - 03/25/14 08:34 PM Re: Brilliant article on smurfing laws Retread
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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?
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#1908570 - 03/25/14 08:35 PM Re: Brilliant article on smurfing laws Retread
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^ 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
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#1908575 - 03/25/14 08:42 PM Re: Brilliant article on smurfing laws Retread
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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
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#1908584 - 03/25/14 09:18 PM Re: Structuring Retread
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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.
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#1908661 - 03/26/14 01:49 PM Re: Structuring Big Dog
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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.
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#1908668 - 03/26/14 02:06 PM Re: Structuring Retread
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^ 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.
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#1909004 - 03/27/14 12:32 PM Re: Structuring Retread
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I'm concerned ...are you talking about discussing SAR filing with the customer?
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#1909020 - 03/27/14 01:08 PM Re: Structuring Retread
ACBbank Online
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^ 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.
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#1909026 - 03/27/14 01:12 PM Re: Structuring ACBbank
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"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.
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#1909162 - 03/27/14 03:38 PM Re: Structuring Retread
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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.

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#1909202 - 03/27/14 04:06 PM Re: Structuring Retread
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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.
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#1909236 - 03/27/14 04:36 PM Re: Structuring MrsSmithCRCM
Elwood P. Dowd Offline
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Quote:
Half right and half baked.


...was intended to indicate the article was stupid.
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#1909327 - 03/27/14 06:10 PM Re: Structuring MrsSmithCRCM
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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.
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