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#2058378 - 01/13/16 06:07 PM Revoke Phase II Exempt Customer for closing accoun
LetsTalkCompliance Offline
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Long time reader, first post!

A customer who was designated as Phase II exempt recently closed its account because they sold their franchise. Must I file a revocation of Phase II Exemption with FinCEN for this Tax ID? Do you revoke exemptions for customers who terminate their relationship with your bank?

FinCEN 2009-G003 (Aug 2009) says "Banks have never been required to formally revoke an exemption using the DOEP form. Generally, examiners or other users of BSA data would be able to rely on a pattern of reporting to know that a customer is no longer being treated as exempt. For purposes of clarity or creating internal documentation, however, many banks voluntarily revoke exemptions using the DOEP form."

Do you voluntarily revoke exemptions? Thanks!
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#2058461 - 01/13/16 09:05 PM Re: Revoke Phase II Exempt Customer for closing accoun LetsTalkCompliance
NotDoneYet Offline
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NotDoneYet
Joined: Jul 2010
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PA
I don't when a customer has closed their accounts.
But I do if I need to revoke an exemption for an existing customer.

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#2058629 - 01/14/16 04:05 PM Re: Revoke Phase II Exempt Customer for closing accoun NotDoneYet
Cape Codder Offline
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^^^^ Same here.
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#2058643 - 01/14/16 04:21 PM Re: Revoke Phase II Exempt Customer for closing accoun LetsTalkCompliance
Sunshine Lady Offline
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Posts: 587
Ditto
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#2059095 - 01/15/16 09:07 PM Re: Revoke Phase II Exempt Customer for closing accoun LetsTalkCompliance
Doug Hendrickson Offline
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Doug Hendrickson
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We don't. Our annual review of exempted accounts and the annual report to the board would document the fact that we revoked the exemption and the examiners would also know from the pattern of reporting.
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#2059604 - 01/20/16 08:26 PM Re: Revoke Phase II Exempt Customer for closing accoun LetsTalkCompliance
banker1976 Offline
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Mid-Atlantic
We file a revocation in the event an account is closed - only because every so many exams we will have an examiner whip out their handy dandy list of our bank exemptions and want to see a file on someone they have as exempt, whereas we have as closed and we'll even show them it's closed but alas to some examiners their handy dandy list should match ours. So we have found it best to file the revocation in all circumstances (but that's just us and our process).
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#2060759 - 01/27/16 04:32 PM Re: Revoke Phase II Exempt Customer for closing accoun LetsTalkCompliance
GrannieTwo Offline
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Posts: 180
Central IL
I had the same question about revocation and was told by our auditors it wasn't necessary to just document it which I did. I made a copy of the email, showed the only deposit made during 2015, my email to the entire staff that this account was no longer exempt and updated our exemption list.
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#2060787 - 01/27/16 06:19 PM Re: Revoke Phase II Exempt Customer for closing accoun LetsTalkCompliance
thisisme08 Offline
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Joined: Oct 2012
Posts: 47
I've revoked in the past. Easy insurance for me since we only have a few exemptions.
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#2060814 - 01/27/16 07:38 PM Re: Revoke Phase II Exempt Customer for closing accoun LetsTalkCompliance
John Burnett Offline
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Cape Cod
When the process doesn't require the formal revocation, the only thing that should matter to an examiner is whether your bank has consistently filed CTRs after you have internally canceled the exemption. Any examiner who tries to argue that you should file the revocations either doesn't understand that it's not required, or is simply trying to create a kerfuffle, which is ultimately a waste of everyone's time.
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#2060924 - 01/28/16 02:56 PM Re: Revoke Phase II Exempt Customer for closing accoun LetsTalkCompliance
LetsTalkCompliance Offline
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Thanks for the feedback, all!

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