Has anyone read FinCEN's newly issued Guidance on Record Keeping Requirements under 103.29 concerning cash sales of Monetary Instruments (it is under Bankersonline Top Stories for 12/3/02)?! It states "FinCEN takes the position that when a customer purchases a monetary instrument between $3,000 and $10,000 using currency that the customer first deposits into the customer's account, the transaction is still subject to the recordkeeping requirements of 103.29. This is true whether the transaction is conducted in this manner as required by a financial institution's established policy, or at the request of the customer." It further states "Financial institutions are reminded that records required to be kept pursuant to 103.29 must be retained for five years and be made available upon request to FinCEN and any agency exercising delegated authority as set forth 31 CFR 103.56. Accordingly, financial institutions should implement procedures to enable the required records to be available upon request."

I thought a policy where the customer is required to first deposit the cash into their account, then debit the account to pay for the monetary instrument releaved the bank of 103.29 requirements - if this is not the case, then what is the point of having such a policy? How do banks with such policies retreave information of this sort for up to five years unless it is kept on some sort of a log? Also, wouldn't transactions of this sort now fall under the Section 314 information searches from FinCEN?

Here is the link to the guidance:

http://www.fincen.gov/monetaryinstrumentsales3a.pdf

We've got two different threads going on this same topic - Here's the other one.

I don't believe this interpretation would increase our responsibilities under the 314(a) searches because the "payee" is not one of the required record-keeping components. The "purchaser" is, but we could verify that information for deposit accountholders through our CIF searches.

Then again, anything's possible.

However, if we had a positive match for our customer, then we would probably be required to do the more extensive file search for the other information. This interpretation leaves many unanswered questions.

My opinions are my own and not those of my employer.