Here is the scenario: We have a seasonal customer who sets up corn/fruit stands in the area this time each year (usually August through early October). Most of their sales are done for cash. Two years ago the customer figured out the threshold for filing CTR's is $10,000. Since then they make daily cash deposits of $9,900 from August - October. This is clearly structuring and we have filed SAR's for the past two years - getting ready to file a third. The customer is now coming to us (they've obviously been doing some research) and wants to know how they can become exempt from CTR filing. In a "good" scenario they would qualify for a Phase II exemption (they've had the account for more than 12 months and frequently engage in cash transactions of more than 8 per year - plus they are not on the list of ineligible businesses).
In the days of growing and maintaining deposits, it's very unlikely the account officer will agree to close the account or terminate the relationship.
My quandry is this - do I deny the exemption due to the fact we are aware of the structuring and in granting the exemption would it look like we are trying to "cover-up" illegal activity? The customer's point is "I will stop making daily deposits of $9,900 and make them all at once if you exempt me." Or do I grant the exemption (assuming they make at least 8 cash deposits over $10,000 in one calendar year) knowing that doing so will stop the structuring?
This customer is on our high risk list (for being cash intenstive and structuring) and will continue to be whether or not we grant the exemption.
Any suggestions would be helpful