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#2255960 - 06/25/21 03:25 PM In person and ATM Withdrawal
Luv2run Offline
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Good Morning!
A customer came in yesterday and pulled $10,000.00 from a joint account held with her husband. Later that day, an ATM withdrawal was made that puts them over the threshold. I was told by the teller that the customer withdrew the $10,000.00 because "they" were buying a boat. My question is as follows: Would I need to file the CTR assuming since "they" are buying a boat the funds are for joint use and the ATM withdrawal would have to have been completed by one of the joint owners?
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#2255978 - 06/25/21 05:08 PM Re: In person and ATM Withdrawal Luv2run
ColoradoAML Offline
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I'm assuming you've confirmed that it was the husband rather than the wife that conducted the ATM withdrawal, because otherwise a CTR is required regardless.

Whether or not the transaction was on behalf of both customers and the teller was referring to the two of them when they said "they" is probably best answered by the teller.

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#2255980 - 06/25/21 05:43 PM Re: In person and ATM Withdrawal Luv2run
rlcarey Offline
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Well, if you made a determination that the $10,000 withdrawal was done on the behalf of both of them, then regardless of whether the ATM withdrawal was conducted by the husband or the wife, then a CTR is due.
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#2256007 - 06/25/21 09:33 PM Re: In person and ATM Withdrawal Luv2run
Richard Insley Offline
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Don't you assume that all joint owners benefit from transactions, regardless of which of them personally conducted the business? In such a case, the account is the link. If they have "mine", "yours", and "ours" accounts, then you have to look at two possible links: what happened within each account, and also what happened that will benefit each individual.
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#2256013 - 06/25/21 10:18 PM Re: In person and ATM Withdrawal Luv2run
rlcarey Offline
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Well, FinCEN has their own idea on this Richard - regardless of common sense.

24. How do I properly complete Part I on the FinCEN CTR for withdrawals from a joint account? What amounts do we show in Item 22 for each Part I? For example, John and Jane Smith have a joint account together. During one business day, John Smith withdrew $12,000 from the account.

Since John Smith made a withdrawal from the joint account in excess of $10,000, then the financial institution would list Jane Smith’s information only if it has knowledge that the transaction was also being conducted on her behalf. If the financial institution does not have knowledge that the withdrawal was conducted on behalf of Jane Smith, then it would neither be required to nor prohibited from listing Jane Smith in a second Part I.

Therefore, if the financial institution does not have knowledge that the withdrawal was conducted on behalf of Jane Smith, the financial institution would complete a Part I on John Smith. For Item 2 of Part I, the financial institution would check 2a “Person conducting transaction on own behalf” and complete the applicable information for John Smith. Item 22 for Part I on John Smith would be completed by entering $12,000 and providing the account number affected.

However, if the financial institution does have knowledge the withdrawal was completed on behalf of both John Smith and Jane Smith, the financial institution must complete two Part Is. In completing a Part I on John Smith, the financial institution would check 2a “Person conducting transaction on own behalf” and complete the applicable information for John Smith. In completing a Part I on Jane Smith, the financial institution would check 2c “Person on whose behalf transaction was conducted” and complete the applicable information for Jane Smith. Item 22 for each Part I would be completed similarly by entering $12,000 and providing the account number affected.
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#2256014 - 06/26/21 12:51 AM Re: In person and ATM Withdrawal rlcarey
Richard Insley Offline
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I see what you mean by common sense (until getting to the "neither required nor prohibited" part!) Interestingly, the more I read it, the more it looks like this instruction fails to provide a clear answer to the OP's actual question: do you file a CTR, or not?

Question 24 begins (conveniently) with a cash transaction that exceeds $10K and must be reported, one way or another. This is not the case for the OP. Q24 goes on to tell us to make the Y/N "conducted by?" and "conducted on behalf of?" decisions based on actual knowledge. Unless the ATM gives you different card IDs for the joint account holders or you're looking at ATM security video, you can't have actual knowledge of which joint accountholder was present. Nothing the ATM can provide tells you whether the conductor was acting on behalf of the other accountholder. At the end of this analysis, I could have no actual knowledge that the combined transactions were by or on behalf of Jane, and no actual knowledge that the combined transactions were by or on behalf of John. That can't possibly mean that lack of proof means no aggregation and, therefore, no CTR!
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#2256016 - 06/26/21 11:52 AM Re: In person and ATM Withdrawal Luv2run
rlcarey Offline
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Yes - that was sort of my point. If you determined that the $10,000 withdrawal was conducted on behalf of them both, then the ATM withdrawal also had to be conducted by one of them on behalf of one or both of them, which when aggregated with the $10,000 would trigger a CTR..

I would just make a judgement call based on any information that might be available on who conducted the ATM transaction and file and move on
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#2256018 - 06/26/21 05:25 PM Re: In person and ATM Withdrawal Luv2run
Richard Insley Offline
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So...are we concluding that, given the OP's stated facts, the Y/N decision to file the CTR hinges on having "actual knowledge" that one of the two transactions was conducted on behalf of both accountholders? What's the reliability threshold for "actual knowledge?" How much reliance can/should you place on casual chit chat at a teller window? (If customers are actually laundering money, that chat will be fiction.) At what point will LE say you were willfully blind NOT to grill the transactor about "on behalf of" parties who are not present?

It's one thing to debate the capacity (transactor vs. on behalf of) of joint accountholders after you're sure a CTR must be filed, but using an undefined "actual knowledge" standard as the basis for the file/don't file decision gives me heartburn. Unless deposit account recordkeeping has expanded in recent years, one year after these transactions (when LE opens a criminal investigation of Jane, John, or both), the only "actual knowledge" I can prove with copies of retained records will be the dollar amounts (and maybe the locations) of the transactions and the identities of the joint accountholders.
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#2256023 - 06/28/21 01:36 PM Re: In person and ATM Withdrawal Luv2run
ColoradoAML Offline
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FIN-1989-R005, which is one of my least favorite pieces of guidance but one that I cite regularly when trying to chase down lawyers' clients' personal information, seems to give the instructions that any time you aren't familiar with the customer's expected activity, you should ask. It doesn't say to do any verification beyond asking, but I'm sure this is a slippery slide into a "risk-based" argument with an examiner.

"Because the BSA requires financial institutions to file complete and accurate CTR's, it is the financial institution's responsibility to ascertain the real party in interest. 31 U.S.C. 5313. One way that a financial institution can obtain information about the identity of the person on whose behalf the transaction is being conducted is to ask the person conducting the transaction whether he is acting for himself or on behalf of another person. Only if as a result of strong "know your customer" or other internal control policies, the financial institution is satisfied that its records contain information concerning the true identity of the person on whose behalf the transaction is conducted, may the financial institution rely on those records to complete the CTR."

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#2256051 - 06/28/21 05:30 PM Re: In person and ATM Withdrawal Luv2run
Luv2run Offline
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I am going to see if I can determine who made the ATM transaction based on card number....Thank you Richard!

Thank you all for your input. The wife withdrew the funds so they, she and her husband, can buy a boat. I was really hung up on the ATM transaction but think I can figure it out.

Thanks very much!!!!
Last edited by Luv2run; 06/28/21 05:35 PM.
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