Hi, as part of our ATM monitoring we compare ATM account credits and debits for our ATM owners and operators in order to determine if the ATM is overfunded or underfunded.

Is there a certain threshold we should be concerned with if the ATM is overfunded (for example, 10% or 25%)?

Similarly, is there a certain threshold we should be concerned with if the ATM is underfunded? I am struggling to understand the significance of an underfunded ATM.

More broadly speaking, is it necessary for us to perform this analysis on a monthly basis?

Thanks for your guidance.

You might need to define what you mean by "if the ATM is overfunded or underfunded."

Such a review is usually completed at the normal customer review period based on an assigned risk rating.

Thanks for the response, that helps me determine that we can determine appropriate reviews/controls based upon risk ratings.

To try and add detail, we basically compare cash in and cash out to see if there if the activity is consistent and and ATMs balanced. If activity is inconsistent or higher than what should be generated, we determine if the activity is suspicious enough to raise to the level of a SAR.

I am trying to figure out what activity would be inconsistent or suspicious enough to raise to the level of a SAR.

I am not sure there is a specific threshold for reporting, but if you have a company that is withdrawing a lot of cash that is more than the withdrawals made at the ATM, then you need an explanation. Same way with the other direction. You need to be comfortable that their other business activities will generate enough cash to fund the ATM difference. It all comes down to how you feel about the customer and their activities and whether or not it is reasonable.

Monthly seems very excessive. At my previous bank, if a customer self funded they were reviewed/compared every six months. If they didn't and funded via account W/D, etc, it was annual.

Hey - a pretty timely piece from FinCEN: https://www.fincen.gov/news/news-re...ence-independent-atm-owners-or-operators

From FinCEN's statement:

"The ML/TF risk for independent ATM owners or operators can vary depending on the facts and circumstances specific to the customer relationship, such as transaction volume, locations of the ATMs, and the source of funds to replenish the ATMs. Independent ATM owners or operators that fund their ATM replenishment solely with cash withdrawn from their account at a bank may pose a relatively lower ML/TF risk because the bank knows the source of funds and can compare the volume of cash usage to electronic funds transfer settlements to identify suspicious activity. Conversely, independent ATM owners or operators that replenish ATMs from other or unknown cash sources may present potentially higher ML/TF risks, as the source of cash can be difficult for the bank to verify. "

FinCEN suggests that the statement was issued because it hears that there are independent ATM owners/operators who are having trouble opening bank relationships, and FinCEN is concerned that some banks may be de-risking based on a type of business rather than focusing on the risk involved in individual businesses or operators.

We had maybe three exams in a row where private ATMs seemed to be the sole concern of our examiners. They would review our controls and ask why we aren't doing all these other things, and we would explain repeatedly how we determine their activity is suitable. No recommendations ever came out of it, but it was enough for us to shorten the time between reviews and lower our risk tolerance. In my view, they aren't that high-risk or hard to mitigate, but it just wasn't worth arguing about every 12-18 months.