A CTR exempt customer's employee drops off a deposit and refuses to provide the 'person conducting the transaction' information prompted by our system for a large cash deposit. Is there any reason not to complete this transaction since we know for sure that we would not be filing a CTR? If they weren't exempt, we would refuse the transaction and speak to the account owners about what information we require from their employees who make their deposits.

Since there's no reason for you to file a CTR, why would you refuse the deposit? You don't need the info; don't put up unreasonable roadblocks.

Along the same lines as John's comments, many systems allow you to designate who the exempt customers are so they will not prompt tellers to obtain information on individuals conducting transactions on these accounts. Check with your representative to see if your system has this functionality.

Thank you. So is there no reason to obtain this information for any transactions for exempted customers? My confusion stems from a statement on the online manual on the FFIEC website that says:

"The exemption procedures do not have any effect on the requirement that banks file SARs or on other recordkeeping requirements. For example, the fact that a customer is an exempt person has no effect on a bank’s obligation to retain records of funds transfers by that person, or to retain records in connection with the sale of monetary instruments to that person."

The Travel Rule and MI record keeping rule would apply to the conductor should they initiate a funds transfer or purchase a MI above the applicable amounts. At that time, you collect the required information.

Lots of responses in just a few minutes. I'm reading your post to say your bank requires ID at an amount of something less than $10K. Others may not be.

If your policy requires identification from people conducting cash transactions above $XXXX, then you always do it. If your policy says except for transactions involving customers whom your bank has identified as "exempt persons" you're good.

First, your policy is the equivalent of a legal requirement within the 4 walls of your institution. Any third party reviewer could, would and should take you to task for not doing something you mandated just because someone complains.

Second, based on definitions found in the 7th issue of the SAR Activity Review, any attempt to avoid your internal systems for monitoring currency is "structuring."

There are four types of structuring activities that are reportable:
1. To avoid generating any Currency Transaction Report, Form 8300 and supporting records, and to avoid any recordkeeping connected to monetary instruments.
2. To avoid the identification requirements, e.g. connected with non-bank money transmissions and purchase of monetary instruments.
3. To avoid suspicious detection and conventional monitoring thresholds and filters.
4. To avoid enhanced scrutiny or additional review frequently triggered by higher transaction amounts and thresholds


Whatever the rule is here, your bank made it. Now you have to stick to it.

This says that you have an obligation to monitor the account for suspicious activity, retain records for wire transfers into or out of the account to comply with travel rule and if someone makes purchases a monetary instrument with cash on behalf of the exempt business.

When reviewing an exempt account for suspicious activity, you are not really worried about who is bringing in the cash, you want to make sure that the amount and frequency of cash deposits makes sense for that customer. (I.e. you could have four exempt gas stations all at the same intersection. Three bring in $20,000/week, one brings in $200,000/week. Your suspicious monitoring and enhanced due diligence processes would want to answer why the fourth gas station is bringing in so much more cash.)

Thank you all so much. You've been a big help.

And don't forget that, if it's a non-listed business (Phase II exemption) the exemption only extends to transactions on the business's behalf in the business's exemptible transaction accounts. A currency exchange (cash for cash) would have to be reported if more than $10,000 in or out is involved.

Thank you. I just noticed the very beginning of Ken's post. Our system prompts for ID information for any cash transaction over a certain amount (I believe it's $3,000). I've just reviewed the transaction, and it was over $10,000 in cash.

We have an individual that came in to pay for property taxes. The teller deposited the funds into the government entity that is Phase I exempt. Does this qualify for a CTR report due to the fact that an individual walked in and is not associated with the government entity?

Yes it would trigger an CTR as the person depositing the funds is doing it on his own behalf, paying his taxes.

Caveat, that the person came in with CASH over $10K.