Borrower sold vehicle for $11,500, was paid cash. Loan payoff was $7,500 or so. He started counting it out and decided it was taking too long so just handed the whole stack to the teller. The remaining funds were given back to him and never ran through an account.

I've read several other discussions on this, and based on those, the relevant amount is the cash used to make the payoff, not the total handed to us, in this situation. If that is the case, I don't have a CTR to file.

How would you treat this?

Just so I understand the situation correctly. Customer walks in with $11,500 in cash with the intent to pay off a $7,500 loan. Customer begins to count the cash, gets annoyed and requests the teller count out $7,500 in cash to pay off the loan and return the remaining $4M in cash?

If the above is correct, no CTR is needed.

Yes. The caveat being the transaction was run as follows, resulting in it showing up on the cash transaction reports.

Cash in, $11,500, loan payoff $7,500, cash back $4,000. Since they used the cash dispenser to do the counting instead of doing it by hand (plus verify the bills were all good). So we have it on a report, and I can certainly note what happened, but it gives me reason to pause at least.

The $4,000 given back to him would have all been bills he originally handed us, for whatever that may matter or not.

I would have to disagree. Teller received and processed $11,500 cash in, with $4,000 cash out. Over $10,000 was given to teller; file the CTR ($7,500 loan pmt/$4,000 currency exchange)

I agree. The cash crossed the counter and was under the bank's control. It's a loan payment and cash exchange.

If there's nothing to document the fact that the $4,000 crossed the counter, the bank could get away with no CTR. But in the narrative of this scenario, there's a record of $11,500 being handled by the bank.

Thanks all. Never done a CTR with currency exchange involved, and falsely assumed it was only regarding foreign exchanges. I've now seen otherwise in FinCEN's guidance.

Although it's been 20 years since I had to make a CTR filing decision, I doubt anything has changed that would affect my thinking. Regardless of the audit trail created by the bank's recordkeeping systems, I don't see a currency exchange here...and if there's no currency exchange to aggregate with the loan payoff, then this event does not reach the $10,000 reporting threshold.

In this case the same currency is always on the counter. Only one transaction took place--the $7,500 loan payoff. The other $4,000 was present and inspected...but it never became a debit or credit to any bank account. "Look-alike" transactions have always been a problem for CTR filers, and that's all you have here. (If something has changed, please feel free to squash this post like a bug. :))

If all the bank needed was $7,500 for the pay-off - why did the teller keep counting after that amount was reached??? Something does not make a whole lot of sense here.

Nobody here would physically count out that much cash being deposited, they would only count it back to the customer to satisfy them. They stick it in the cash recycler and let the machine do all the work. He didn't indicate how much he had, teller assumed it was going to be relatively close to the payoff, and assumed incorrectly. Cash did leave the counter, even if the same cash spit back out of the machine.

Then file and be done and there will never be anyone that can question it again.

Let me ask a question here. How are we completing this CTR exactly? Are we calling the remaining $4M a currency exchange?

Yes, ACB. I referenced this discussion, which pushed me to the FinCEN FAQ referenced in the second post.

http://www.bankersonline.com/forum/ubbthreads.php?ubb=showflat&Number=1689313

I understand that, I just don't know if I agree with it (Not the FinCEN Guidance, just the transaction). We don't know if a currency exchange actually took place.

I guess it's irrelevant at this point. It's probably better to play it safe and file the CTR.

Anon2 sez: I totally disagree that the CTR is required. Stupidity (writing out $11,500 in records when it was $7,500) is not a reason to file a CTR. Unfortunately in order to avoid this conversation in exams, I'd agree with filing the CTR anyway!

IMO teller protected bank and self by creating an audit trail of the cash in/out. Further, cash handed to teller followed by cash handed back by teller = currency exchange; same vs. different bills/denominations doesn't matter.

In our system it would flag the transaction for a CTR because of the $11,500 cash in tag, regardless of the net transaction. Our teller system would pop up a CTR on the screen to be completed when the Enter button was pushed. I agree with previous posters to file the CTR.

It does if you consult Webster. "exchange: an occurrence in which people give things of similar value to each other : the act of giving or taking one thing in return for another thing." In the case at hand, there is only one set of "things." None of the teller's similar "things" ever leave the cash drawer and none of the customer's 4,000 excess "things" end up in the cash drawer.