Dear [ ]:
I am responding to your letters, dated March 20, 2008, and June 8, 2008, to the Financial Crimes Enforcement Network ("FinCEN"), in which you seek an administrative ruling on the treatment of certain deposits for Currency Transaction Report, FinCEN Form 104 ("CTR") purposes. Specifically, you seek a ruling on behalf of your client, [ ] (the "Bank") on a scenario involving unrelated companies contracting with an armored car to make deposits that collectively exceed $10,000 in currency at a bank.
Based on your representation, the Bank has four customers1 (the "Companies") who have contracted with the same armored car service to deliver currency deposits to the Bank.2 Upon receiving the deposits, the Bank completes a single CTR, if the total amount of currency delivered by the armored car service is in excess of $10,000. The Bank reports information on each Company whose currency is being deposited in Section A of Part I of the CTR, checks the "Armored Car Service" and "Multiple Transactions" boxes, but provides no other information in Section B of Part I, and reports the total amount deposited on behalf of all the Companies in Part II.
Under FinCEN's regulations, "[e]ach financial institution … shall file a report of each deposit, withdrawal, exchange of currency or other payment or transfer, by, through, or to such financial institution which involves a transaction in currency of more than $10,000[.]"3 A financial institution must file a CTR when it has knowledge that multiple transactions by or on behalf of a person involve transactions in currency that aggregate more than $10,000 cash in or cash out in one business day.4 In addition, financial institutions must file a CTR for currency received by an armored car service from the financial institution's customer when the armored car service, as an agent of the financial institution, physically receives cash from the customer, transports it and processes receipts, even though the currency may never physically be received by the financial institution.5
In the situation you have described, the Companies have contracted with the armored car service to make deposits at the Bank, rather than the Bank contracting with the armored car service to receive currency. Thus, the armored car service is making deliveries for the Companies rather than acting as an agent of the Bank. The CTR requirement applies, if the $10,000 threshold is met, when the armored car service delivers the currency to the Bank, and not when the armored car service receives the currency from the Companies. Therefore, if the deposit made by the armored car is greater than $10,000 a CTR should be completed, checking boxes 1b (multiple persons) and 1c (multiple transactions) to indicate that multiple transactions and multiple persons were involved. Since the Companies are distinct entities, a separate Section A should be completed for each Company on whose behalf a transaction is conducted. Additionally, in Section B, the Bank should provide as much information as it can about the person conducting the transaction, the armored car employee acting as an agent of the Companies.6 The total amount of currency received should be reported in Part II.
It should be noted, however, that completing a CTR when more than $10,000 has been deposited by the armored car service does not alter the Bank's responsibility to complete a CTR if, aggregating the armored car deposit together with other transactions on the same day, the Bank has knowledge that more than $10,000 in currency has been deposited on behalf of one of the Companies. The Bank will, of course, automatically have such knowledge if the armored car deposit itself includes a deposit of more than $10,000 on behalf of any one of the Companies.7 In addition, however, FinCEN wants to remind the Bank that armored car transactions may only be one type of transaction for a particular customer during a business day, and the Bank should have policies and procedures in place that identify and aggregate both armored car and other transactions if the Bank has knowledge that the transactions are by or on behalf of the same customer. These policies and procedures should allow the Bank to make effective use of its knowledge with respect to all of these transactions.
If the Bank had a separate agreement with the armored car service making deposits for the Companies, under which that armored car service made deposits at the Federal Reserve Bank [ ] on the Bank's behalf, the Bank's reporting requirements would be somewhat different. An agreement between the Bank and the armored car service to make deposits on the Bank's behalf would mean that the armored car service was, in essence, acting as an agent of the Bank. If this were the case, Section A of the CTR would be filled out as directed above, but in Section B, only box "a" for "Armored Car Service" would need to be checked to satisfy the CTR requirements.8 The Bank's aggregation responsibilities outlined above would still apply.
In arriving at the determinations in this administrative ruling, we have relied upon the accuracy and completeness of the representations in your letters. Nothing precludes us from seeking further action should any of this information prove inaccurate or incomplete. We reserve the right to publish this letter as guidance to financial institutions, with information redacted in accordance with your request under 31 C.F.R. § 103.81(a)(5) and as indicated in your March 20, 2008 and June 8, 2008 letters. You will have 14 days after the date of this administrative ruling to identify any other information that you believe should be redacted and the legal basis for the redaction. Should you have any additional questions, please contact FinCEN's regulatory helpline at (800) 949-2732.
Sincerely,
/signed/
Jamal El-Hindi
Associate Director
Regulatory Policy and Programs Division