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September 14, 2009 - The Financial Crimes Enforcement Network (FinCEN) responded to a request for an administrative ruling on the treatment of certain deposits for Currency Transaction Report (CTR) purposes when a financial institution has several customers contracting with an armored car to make deposits that collectively exceed $10,000 in currency.
The specific facts presented to FinCEN were:
“[A] Bank has four customers who have contracted with the same armored car service to deliver currency deposits to the Bank. 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.”
In addition to other CTR filing requirements, 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. [Admin. Rul. 88-5 (Aug. 2, 1988), 31 C.F.R. Part 103, App. A]
However, in the facts before FinCEN, the customers 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. Given these facts, FinCEN stated that the CTR requirement applies 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 as follows:
- 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.
- The total amount of currency received should be reported in Part II.
FinCEN reminds institutions that even after completing a CTR after an armored car service deposit, there remains the responsibility to aggregate the armored car deposit together with other transactions on the same day to determine if more than $10,000 in currency has been deposited on behalf of one entity.
Finally, FinCEN notes that 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 armored car service would be, in essence, an agent of the Bank. Therefore, the Bank's reporting requirements would be somewhat different. In that 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.
The Bank's aggregation responsibilities outlined above would still apply.
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