Scenario: Jan brings in payroll check in an amount of $12,000. She leaves the bank with $11,000 cash and deposits $1,000 into her checking account.

CTR will be filed for $11,000 cash out. I was taught that the type of transaction should be "negotiable instrument cashed". Also, since the deposit to the account was proceeds of the check, not cash, no reference would be made to the account deposit.

During a recent review of CTR completion procedures, a discussion arose regarding this practice based on training received by bank personnel at a BSA seminar this year. The trainer apparently indicated that the "deposit/withdrawal" box should be checked and the account number documented in Item 35 since that account was affected during the transaction scenario.

THOUGHTS?

I would file the CTR as a deposit/withdrawal with the account number listed. It sounds like she received cash back from a deposit.

I have always filed as your first example, a negotiable instrument cashed. The funds were not withdrawn from the account, they never went into the account.

I agree with BSA4LIFE and Kelsey D.

I would have filed as a less cash deposit (deposit/withdrawal). Had she left with all 12,000 in cash I would have said negotiable instrument cashed.

Interesting. I'm surprised that it is thought of as a deposit/withdrawal by so many since the account will reflect only a $1,000 deposit from a check. The CTR instructions indicate that "only cash transactions should be reported on the CTR" so that is why the previous training I have received made sense to me. I may be over analyzing the actual movement of cash. (I'm good at that!)

It sounds so simple until you start trying to fill in the blanks, doesn't it? It's really very frustrating when you are trying to audit CTRs and want to provide accurate guidance. Has anyone seen any FinCEN guidance?

Thanks so much for your thoughts. I'll continue to monitor for responses.

I would file it as Negotiable Instrument Cashed and not mark the account Number since the account was not affected by the cash portion. I would have handled the same way that you originally described. I just went through a BSA exam and they went over all the CTRs and we didnt have any problems reporting that way.

Here's another interesting twist that was brought up in a compliance school I recently attended. Customer has 12,000.00 check that he 'cashes' and put 1,000.00 into his checking account and 11,000.00 cash he took to the loan teller 2 windows down to pay his loan. I would not have reported this on a CTR since no 'cash left the bank', but the instructor said if it leaves the teller window it should be reported. Your thoughts?

I have always used the "through the door" analogy and that has been supported through conversations with FinCEN. I think that trainer is way off base; no cash was brought into the bank or taken out of the bank by that customer.

Here is another way to look at it. I would have filed that as a negotiable instruments cashed because the cash the customer received was from the negotiable instrument not from the account. I also would include the account number because the transaction itself touched the account. If you go back to the account history a year later then you can find the transaction and the copy of the transaction will show that the customer received $11,000.00 back in cash. That is my personal interpretation.

To the first question:

I have been given both responses to that scenario as are seen here. Technically, the "correct" (according to my sources as we all know different people will say different things even in the same agency) way to complete the CTR is to enter the amount of cash taken on the split deposit and mark the negotiable instrument cashed box with no account number present since no account was affected by the cash.

HOWEVER, it was noted that it doesn't hurt to file it the other way as long as you would be able to locate the transaction when asked to produce it five years from the day it happened.

The example I was given was that by marking the withdrawal box and supplying the account number we may have a hard time locating a withdrawal since one for that amount never occurred. likewise, if we mark negotiable instrument cashed and no account number it would be incredibly hard to locate the check that was cashed for that amount since it too does not exist.

So the final advise was more information is better than not enough. Even if you file it "correctly", it wouldn't hurt to document any additional information on copies kept at the bank to help locate the transaction.

I will throw in another question. How do you treat cash advances against credit cards. Visa requires the bank to advance up to $5,000 in cash per day to customers or non-customers. Do you aggregate that cash with any that may have been withdrawn? If so, how do you tie it to an account?

Our system has the ability to identify individuals conducting cash transactions over a certain limit (whether or not CTR reportable). Some of my banks have set this limit to $3,000. In the scenario you present, the teller system would aggregate this transaction with any other transactions conducted by or on behalf of that individual for the day.

In my banks that have not lowered the cash tracking below $10,000, a CTR would be completed only if an employee has knowledge that the customer walked out of the bank with over $10k. No system will catch everything. There are many situations that must rely on an employee recognizing a CTR is needed and taking the appropriate action to create the report. This is an extremely important point to cover in our branch training programs.