Thread Options
#2101303 - 09/30/16 07:28 PM Convoluted CTR Situation
Wildcat Rampage Offline
Member
Joined: Aug 2016
Posts: 91
Kentucky - Home of the 8 time ...
I've been made aware of a transaction that has just happened at one of our locations. I will get to deal with this scenario first thing Monday. I'd like to know what I'm doing and have some confidence about it going in. I've researched and found a similar situation, but I haven't found anything exact.

All names are made up.

Old McDonald Farms employs migrant workers. On most Fridays the migrant workers come in and cash their checks.

Today, Migrant Worker 1 came in with his check and the checks of 14 of his colleagues (Migrant Workers 2-15).

Total cash out to MW 1 was (for illustrative purposes) $12,000 (he had 15 checks that were each written for $800), thus a CTR is required.

When the CTR is completed - I will completely ignore Old McDonald Farms - the transaction was not conducted on their behalf and it was not conducted by them (as they are not a natural person).

MW 1 conducted the transaction. He conducted one for himself and the other 14 for others. I can only choose one option on line 2 - which one do I choose?

Based on the research I've done, the consensus here is that I need to complete 14 Additional Part 2 forms to identify the colleagues for whom the checks were cashed.

Here's where I'm having chest pains - we don't have ID for the colleagues. We don't have TINs and we don't have anything for MW 2 - 15. Do I just leave that part unknown? If I do will someone from FinCEN come punch me?

Am I forgetting something here?
_________________________
Wildcat basketball isn't a matter of life and death, it's much more important than that.

Return to Top
BSA/AML/CIP/OFAC Forum
#2101313 - 09/30/16 08:01 PM Re: Convoluted CTR Situation Wildcat Rampage
PrimeTime Offline
100 Club
PrimeTime
Joined: Nov 2014
Posts: 173
Going with the thought of "who is at your window", I would say that this individual is both the conductor and the beneficiary on the transaction. How do you know that he was conducting on behalf of the 14 other workers? Did you see the funds disbursed to each of these individuals after the checks were cashed (I'm assuming you didn't)? As far as you are concerned, he received the funds and then walked out of your bank; what he did after that is unknown. You're reporting on the facts, which are that one individual conducted a transaction and received the funds therefore benefitting from the transaction.
_________________________
Life is like a bicycle. To keep your balance, you must keep moving.
-Albert Einstein

CAMS

Return to Top
#2101319 - 09/30/16 08:16 PM Re: Convoluted CTR Situation Wildcat Rampage
rlcarey Offline
10K Club
rlcarey
Joined: Jul 2001
Posts: 77,216
Galveston, TX
Based on the research I've done, the consensus here is that I need to complete 14 Additional Part 2 forms to identify the colleagues for whom the checks were cashed.


This is correct. The transaction should have been refused. When the fourteen migrants claim that their checks were stolen, good luck finding migrant #1.
_________________________
The opinions expressed here should not be construed to be those of my employer: PPDocs.com

Return to Top
#2101320 - 09/30/16 08:17 PM Re: Convoluted CTR Situation Wildcat Rampage
Elwood P. Dowd Offline
10K Club
Elwood P. Dowd
Joined: Aug 2001
Posts: 21,939
Next to Harvey
Quote:
Based on the research I've done, the consensus here is that I need to complete 14 Additional Part 2 forms to identify the colleagues for whom the checks were cashed.


That's correct. You do need to list every payee as a person on whose behalf the transaction was conducted because that is obviously what happened.

Personally I really would not want to look any third party reviewer in the eye and say that I honestly thought the individual across the counter had cashed his friends' checks out of his pocket and was just replenishing his cash from us. (I don't like the look on people's faces when they clearly think I am stupid.) Legend has it that a call to the FinCEN Helpline might get you a different answer based on something called "The Fishing Boat Ruling." If so, document the phone call.

Of greater importance is making sure that it does not happen again via a policy that simply prohibits it; e.g. your bank will not cash more than 1 two party check for the same person and only then if that person is a customer whose account provides adequate recourse. Sending a single person to cash many "payroll" checks is emblematic of:
* human trafficking,
* employment of undocumented workers, and
* padded payrolls.

On anyone's scale of justice, your bank would be serving as an accomplice.
_________________________
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
#2101324 - 09/30/16 08:22 PM Re: Convoluted CTR Situation Wildcat Rampage
Wildcat Rampage Offline
Member
Joined: Aug 2016
Posts: 91
Kentucky - Home of the 8 time ...
Thanks Randy & Ken. How much of a problem is the lack of ID and TIN for the other payees? I can only get address for them because they (ostensibly) live in migrant quarters on the farm at which they're employed.
_________________________
Wildcat basketball isn't a matter of life and death, it's much more important than that.

Return to Top
#2101327 - 09/30/16 08:30 PM Re: Convoluted CTR Situation Wildcat Rampage
Elwood P. Dowd Offline
10K Club
Elwood P. Dowd
Joined: Aug 2001
Posts: 21,939
Next to Harvey
Assuming the 14 migrants have cashed checks before based on their own identification you might be able to go back through your records and excavate some of the information. You could also put in a call to the employer and say you will make obtaining the information a condition of cashing future checks. You have 15 days to file the CTR. If they get paid weekly, you might be able to get the information in time...

It is something of a moot point. The CTR would be grossly incomplete, but I'm not prepared to say it could be cited as a violation. I'd probably just paraphrase a recent quote from the Director of the FBI and say it was "extremely careless." wink
_________________________
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
#2101329 - 09/30/16 08:34 PM Re: Convoluted CTR Situation Elwood P. Dowd
Wildcat Rampage Offline
Member
Joined: Aug 2016
Posts: 91
Kentucky - Home of the 8 time ...
Originally Posted By Ken_Pegasus
it was extremely careless. wink
[quote][/quote]

Yes, from top to bottom.

Thank you Ken.
_________________________
Wildcat basketball isn't a matter of life and death, it's much more important than that.

Return to Top
#2102803 - 10/13/16 02:26 PM Re: Convoluted CTR Situation Wildcat Rampage
BuckDog Offline
100 Club
Joined: Jun 2006
Posts: 123
Tennessee
What if farmer issues the checks to the migrant workers, they endorse the checks and farmer deposits the checks into his account? He then withdraws cash and he pays the workers. I'm probably grasping at straws but just wanted to throw out this scenario. We know the farmer very well and know that the money is going to his workers that are here legally through the H-2A worker program.

Return to Top
#2102820 - 10/13/16 02:55 PM Re: Convoluted CTR Situation Wildcat Rampage
John Burnett Offline
10K Club
John Burnett
Joined: Oct 2000
Posts: 39,333
Cape Cod
In that case, assuming you have a cash-out figure that would trigger a CTR, you file it on the farmer unless the farm is exempted under Phase II rules.
_________________________
John S. Burnett
BankersOnline.com
Fighting for Compliance since 1976
Bankers' Threads User #8

Return to Top
#2102931 - 10/13/16 07:57 PM Re: Convoluted CTR Situation Wildcat Rampage
BuckDog Offline
100 Club
Joined: Jun 2006
Posts: 123
Tennessee
Thanks John.

Return to Top

Moderator:  Andy_Z