A review of Suspicious Activity Reports (SARs) filed from July 1997 through mid-April 1999
identified 982 reports noting a BSA/Structuring/Money Laundering violation (in whole or in
part) and citing instances of Automated Teller Machine (ATM) activity in the narrative
section. These reports were filed by more than 90 different banks in 39 states, plus the
District of Columbia and Guam.
The narrative sections of the
SARs reveal that ATMs are being used domestically and internationally to deposit and/or
withdraw large sums of cash on a recurrent basis with the apparent purpose of evading
detection by law enforcement.
Domestically, the SARs indicate
two patterns of structuring of cash transactions to avoid the CTR filing requirement:
First, customers make multiple cash deposits and/or withdrawals on the same day at
different or single ATM locations. Second, withdrawals are made using a combination of
same day counter and ATM activity
|aggregating more than
$10,000for example, cashing a $9,500 check followed by a $500 ATM withdrawal.
A third patternreflected in over 30 percent of the
SARsinvolves international activity. Funds deposited as cash or wired into accounts
in the United States from other nations are subsequently withdrawn within a short period
of time from ATMs located in different countries (usually those having a high-risk for
money laundering or drug trafficking). The size and number of the withdrawals within short
time frames are indicative of potential money laundering.
The SARs filed by the banks in question serve to remind us
that the precautions financial institutions take to prevent or detect money laundering
must deal with ATM systems as effectively as with other parts of banking operations. Bank
training programs, internal control systems, and internal anti-money laundering audits
must take appropriate account of the risk of misuse of ATM systems.
For additional information, comments or questions
concerning suspicious transactions involving ATMs, please call FinCENs Office of
Research and Analysis at (703) 905-3665.