a gajillion years ago i worked at K-Mart, they paid cash as well. dang inconvenient, for sure.
But I'm still wondering if it's the Bank's business to know what they are doing with the cash. All we have is "that it's not normal business activity".
since you have deemed this as "not normal business activity", you need to have a conversation with the customer. imagine telling a regulator that you deemed this not normal and then took no action, and in fact they were doing something illegal. the issues that could present to your bank are scary.
there may be a perfectly legitimate reason for these actions, but the only one that can tell you that is the contractor. and they'll only do that if you ask.