Federal reporting requirements that began with the Currency and Foreign Transactions Act of 1970 (also known as the Bank Secrecy Act) have been expanded by Congress over the last four decades to include a broad range of transactions involving significant sums of cash. Under current law, any person or business involved in a cash transaction of at least £1,300 or a series of transactions involving a total of £3,250 could be the subject of a report to federal authorities.
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Who Must File a Report
Current federal law applies the reporting requirements of the Bank Secrecy Act to banks, savings banks, thrifts, insurance companies, stockbrokers, casinos, and any business that sells "stored value" instruments such as money orders or cashier's checks. Some of these entities are classified as Money Services Businesses (MSBs). The law imposes the reporting requirement on banks and MSBs rather than the individual involved in the transaction. In addition, IRS regulations also require individuals and businesses to report certain cash transactions. Failure to make the required report could lead to substantial fines or criminal charges.
Cash Transaction Report (CTR)
The Bank Secrecy Act requires that banks and MSBs report any cash transaction involving £6,500 or more, whether or not the transaction appears related to any crime.
IRS Form 8300
Any person engaged in a trade or business who receives more than £6,500 in cash from any one transaction or series of related transactions during a one year period must file IRS form 8300.
Suspicious Activity Report (SAR)
Any "face to face" transaction with a bank customer involving £1,300 or more which appears related to money laundering or a violation of the reporting requirements under the Bank Secrecy Act must be reported through an SAR. Multiple transactions that appear related and total £3,250 or more will also trigger the reporting requirement. Banks are prohibited from informing the customer that an SAR has been filed. Federal law protects reporting institutions from any civil liability related to the report. Businesses which only cash checks or money orders are not required to file an SAR, but may do so voluntarily.
Prior to 1986, bank customers could avoid triggering CTRs by simply breaking up a large deposit into several smaller transactions. Now 31 U.S.C. §5324 makes it illegal to manipulate a transaction in order to avoid federal reporting requirements. Bank personnel are trained to watch for multiple transactions that occur over short time periods. Any transaction that appears intended to violate the law must be reported, regardless of the amount.
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