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#2267373 - 03/09/22 05:39 PM Money Mules
Susan, BSA Officer Offline
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Joined: Dec 2020
Posts: 7
I have a customer who deposits large amounts of cash (under ctr threshold) and then immediately sends it out by cash app out to individuals. I have written a SAR in the past, and will continue to write them, but I cannot prove that she is indeed a money mule. We have questioned her before, and she explains that she is sending family and friends money. What other recourse should we be taking besides warning her that it appears she could be a money mule? Would you close the account? Thanks!

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#2267377 - 03/09/22 05:43 PM Re: Money Mules Susan, BSA Officer
rlcarey Offline
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rlcarey
Joined: Jul 2001
Posts: 79,633
Galveston, TX
I would close the account in a heartbeat.
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The opinions expressed here should not be construed to be those of my employer: PPDocs.com

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#2267386 - 03/09/22 07:08 PM Re: Money Mules Susan, BSA Officer
Susan, BSA Officer Offline
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Joined: Dec 2020
Posts: 7
Remember, I am assuming that she is not telling me the truth on why she is sending out the money. But it's my word against hers on where the money is going. All I can see is that she sends it via cash app, Do I tell her that we are closing her account due to the unusual cash activity and the use of cash apps and it appears she is a money mule?

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#2267390 - 03/09/22 07:47 PM Re: Money Mules Susan, BSA Officer
compgal21 Offline
Junior Member
Joined: Jan 2021
Posts: 40
I agree with rlcarey too - I would definitely terminate the account.

What amount of cash does she deposit?
Is she structuring these deposits?
How many deposits a week does she make?
What is the source of funds?

It is in our terms and conditions that we have a right to close an account at any time. We do not have to provide a reason. We close the account and cut them a check (if they have a remaining balance - most of the times they don't). Might want to consult your legal counsel.

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#2267395 - 03/09/22 08:17 PM Re: Money Mules Susan, BSA Officer
ColoradoAML Offline
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Joined: Mar 2018
Posts: 287
I would also close, and I would not bother telling her why.

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#2267406 - 03/09/22 09:10 PM Re: Money Mules Susan, BSA Officer
ACBbank Offline
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ACBbank
Joined: Jul 2006
Posts: 4,191
New York City
Banks do not need proof, courts do. If you're filing repeated SARs I hope you're making enough money off of this customer to justify the cost.
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"100 victories in 100 battles isnt the most skillful. Subduing the other's military w/o battle is the most skillful." Sun-Tzu

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#2267408 - 03/09/22 09:16 PM Re: Money Mules Susan, BSA Officer
HappyGilmore Offline
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Joined: Jun 2004
Posts: 19,534
Pulling people out of the ditc...
Dear customer - per our account agreement, we are choosing to revoke your ability to bank with us effective (30 days from today) date, please come in on that day, if not sooner, to collect the balance in your account.

thanks - bank
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Providing alternative truths since the invention of time

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#2267413 - 03/09/22 09:51 PM Re: Money Mules Susan, BSA Officer
rlcarey Offline
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rlcarey
Joined: Jul 2001
Posts: 79,633
Galveston, TX
Better Yet,

We are choosing to revoke your ability to bank with us effective (5 days from today) date, please come in on that day, if not sooner, to collect the balance in your account or we will mail you a cashier's check for the balance.
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The opinions expressed here should not be construed to be those of my employer: PPDocs.com

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#2267420 - 03/09/22 10:57 PM Re: Money Mules Susan, BSA Officer
Richard Insley Offline
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Richard Insley
Joined: Oct 2000
Posts: 10,068
Toano, VA
Originally Posted by ACBbank
I hope you're making enough money off of this customer....
THIS is the one-size-fits-all answer to every question of this type. Profitability includes all aspects of the customer relationship, of course, but at the end of the day, if your handling cost (including your time...spelled m.o.n.e.y.) leaves the customer under water, it's time to part ways.

Originally Posted by Susan, BSA Officer
...warning her that it appears she could be a money mule
This is a TERRIBLE idea. If she's actually doing what you fear, that is ML. Any discussion about her activity could expose the bank (and possibly YOU!) to criminal "aiding and abetting" charges.
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...gone fishing.

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#2267430 - 03/10/22 01:38 PM Re: Money Mules rlcarey
HappyGilmore Offline
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Joined: Jun 2004
Posts: 19,534
Pulling people out of the ditc...
Originally Posted by rlcarey
Better Yet,

We are choosing to revoke your ability to bank with us effective (5 days from today) date, please come in on that day, if not sooner, to collect the balance in your account or we will mail you a cashier's check for the balance.

I opted for the 30-day limit because the US Treasury requires a 30-day notice if any government benefit is being provided. They do all for an immediate closure for fraud, but not sure this instance has been definitively proven as fraudulent, based on the original post. if not government benefits are going to it, then i would say immediately.

From the US Treasury Green Book:
Financial institutions may close an account to which benefit payments are currently being sent
thereby revoking the enrollment authorization by providing a 30-day written notice to the recipient
prior to closing the account. In cases involving fraud, accounts may be closed immediately. The
financial institution cannot revoke the enrollment authorization by notifying the federal agency and
not the recipient.
The 30-day written notice should remind the recipient to make other arrangements for the
handling of their payments. The financial institution must credit to the recipient’s account any
payments received during the 30-day notice period. The financial institution must also immediately
return to the federal government all payments received after the 30-day notice period. A financial
institution that closes an account without properly terminating the enrollment must make the
funds available to the recipient until proper notice is provided.
_________________________
Providing alternative truths since the invention of time

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#2267438 - 03/10/22 02:45 PM Re: Money Mules Susan, BSA Officer
rlcarey Offline
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rlcarey
Joined: Jul 2001
Posts: 79,633
Galveston, TX
I know Happy - but the chances that a money mule is also receiving G-benefits is probably really low, but yes if they are, you need to follow the Green Book rules. I was giving them the benefit of the doubt by giving them 5 days in my example, at least to allow checks to clear. But I would not hesitate either to pull the trigger immediately and drop a cashier's check in the mail.
_________________________
The opinions expressed here should not be construed to be those of my employer: PPDocs.com

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#2267472 - 03/10/22 06:43 PM Re: Money Mules Susan, BSA Officer
Compliance NABW Offline
Diamond Poster
Joined: Oct 2015
Posts: 1,616
Susan -- Cash inflows would be part of the consideration as well. Where is the customer getting all of the cash to make deposits with? Does such a flow of cash match up with her employment? Is she a high priced stripper, or is she working at the county clerk office? If the latter, then it would be highly unusual for her to have a legitimate source of cash funds at such levels.

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#2267597 - 03/14/22 03:52 PM Re: Money Mules HappyGilmore
Curious in Kansas Offline
Member
Joined: Oct 2015
Posts: 63
I don't believe you have to give the 30 day notice on government benefits if you suspect fraud.

I'd close it out too.

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#2267680 - 03/15/22 06:48 PM Re: Money Mules Susan, BSA Officer
Susan, BSA Officer Offline
New Poster
Joined: Dec 2020
Posts: 7
THANKS EVERYONE! We closed the account and when we told her she just said ok.........she didn't have any government benefits.

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#2267712 - 03/16/22 01:38 PM Re: Money Mules Curious in Kansas
Goldrose Online
Member
Joined: Sep 2018
Posts: 52
Originally Posted by Curious in Kansas
I don't believe you have to give the 30 day notice on government benefits if you suspect fraud.

I'd close it out too.

We can close or freeze it immediately but we must still send the notice and pay out any federal benefits that come in during that time frame.

Termination by the Financial Institution
Financial institutions may close an account to which benefit payments are currently being sent
thereby revoking the enrollment authorization by providing a 30-day written notice to the recipient
prior to closing the account. In cases involving fraud, accounts may be closed immediately. The
financial institution cannot revoke the enrollment authorization by notifying the federal agency and
not the recipient.

The 30-day written notice should remind the recipient to make other arrangements for the
handling of their payments. The financial institution must credit to the recipient’s account any
payments received during the 30-day notice period. The financial institution must also immediately
return to the federal government all payments received after the 30-day notice period. A financial
institution that closes an account without properly terminating the enrollment must make the
funds available to the recipient until proper notice is provided.

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#2267714 - 03/16/22 01:39 PM Re: Money Mules Richard Insley
Goldrose Online
Member
Joined: Sep 2018
Posts: 52
Originally Posted by Susan, BSA Officer
...warning her that it appears she could be a money mule
This is a TERRIBLE idea. If she's actually doing what you fear, that is ML. Any discussion about her activity could expose the bank (and possibly YOU!) to criminal "aiding and abetting" charges.[/quote]

We attended BSA conferences where the FBI provided us flyers to give customers to help warn and educate them, we also just reference them to have discussions with a customer. They literally provided 2 flyers, one for someone who is unwitting, and another "sterner" flyer for those that have been warned or you think they may have an idea of what they are doing. Are you saying we should not utilize these tools provided by the FBI for liability of aiding and abetting?

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#2267717 - 03/16/22 01:45 PM Re: Money Mules Susan, BSA Officer
rlcarey Offline
10K Club
rlcarey
Joined: Jul 2001
Posts: 79,633
Galveston, TX
Handing them a flyer that is available to the general public is one thing. Front line staff having an actual discussion with the customer concerning suspected money laundering is a totally different animal.
_________________________
The opinions expressed here should not be construed to be those of my employer: PPDocs.com

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#2267803 - 03/17/22 01:46 AM Re: Money Mules rlcarey
Richard Insley Offline
10K Club
Richard Insley
Joined: Oct 2000
Posts: 10,068
Toano, VA
Originally Posted by rlcarey
Handing them a flyer...discussion with the customer...is a totally different animal.
This was the basis for my comment. Printed materials speak for themselves. Conversation...ANY conversation...is not recorded, so you have no evidence with which to defend yourself.

Long ago (but the same outcome is likely to happen today), a dirty customer was being prosecuted for ML (and several other crimes). On the witness stand during his trial, he stated that the only reason he split (structured) the cash transactions was because one of my bank's tellers advised him that doing so would avoid the "silly government paperwork." Later that day, federal officers showed up in our general counsel's office demanding any good reason why our teller, the management chain above her, and the bank itself should not be investigated and charged with aiding and abetting.
_________________________
...gone fishing.

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