Smith's Heating Inc has an account with us with four officers listed on the account. John Smith comes in and withdraws $12,000 with a debit memo. The teller put John's information in section one of the CTR and marked the transaction was conducted on his own behalf. Was this done correctly? Thanks

That depends on which person (Smith's Heating or John Smith) the funds were for.

Normally our customers using a debit memo to withdraw funds from a business account are doing so for the benefit of the business. Funds payable for an individual's benefit- salary, bonus, loan repayment, etc.- are normally done with a check. Was there any conversation concerning the purpose of the withdrawal?

I would say yes it is correct...unless you knew that the funds were going to benefit the business. I would ask the teller if he/she knows the answer to that question.

I would say yes it is correct...unless you knew that the funds were going to benefit the business. I would ask the teller if he/she knows the answer to that question.

Oops! Posted twice...Sorry!

The teller said he just came in and wanted to withdraw the money and does not remember any other mention about what the money will be used for.

Then in my opinion John benefited from the funds and the teller was correct in how she filled it out.

Are the 4 officers listed as signers or owners of the account? If they're listed as signers, then I would think the withdraw would be for the benefit of the business (a corporation can't come in and make their own withdrawal, which is why they have signers).

What happens when one of them comes in a deposits cash? Do you assume it's for the benefit of the business or the person depositing the cash? I'd be a little concerned if we had officers of a business customer coming in and withdrawing money from the account for personal use.

Well, when a person comes in to make a withdrawal (whether it's for a person or a business) you cannot assume anyone will benefit from the funds but the person walking out the door with the cash. So, John Smith is the conductor and beneficiary.

But now you have an issue with a principal of a business withdrawing funds from the corporate account for personal use. Is this something your bank has no problem with? If I honestly believed someone was doing this, I'd be calling the company to let them know what was going on.

If the signer is actually an owner on the account, then it could be a different story. However we do not allow individuals to be owners of a corporate account.