Structuring transactions to evade Bank Secrecy Act reporting and certain record-keeping requirements can result in civil and criminal penalties.
Under the BSA (31 USC 5324), no person shall, for the purpose of evading the Currency Transaction Report (CTR) or a geographic targeting order reporting requirement, or certain BSA record-keeping requirements such as the monetary instrument log:
- Cause or attempt to cause a financial institution (including MSBs) to fail to file a CTR or a report required under a geographic targeting order or to maintain a record required under BSA regulations.
- Cause or attempt to cause a financial institution (including MSBs) to file a CTR or report required under a geographic targeting order, or to maintain a BSA record that contain a material omission or misstatement of fact.
- Structure, as defined above, or attempt to structure or assist in structuring, any transaction with one or more financial institutions (including MSBs).
The definition of structuring states, “a person structures a transaction if that person, acting alone, or in conjunction with, or on behalf of, other persons, conducts or attempts o conduct one or more transactions in currency in any amount, at one or more financial institutions, on one or more days, in any manner, for he purpose of evading the [CTR filing requirements].”
MSB employees need to understand the following:
- Structuring is a criminal act for which civil and criminal penalties may be imposed. Care should be taken not to assist customers in a manner that could give the impression of coaching them to evade and avoid the reporting requirements.
- Structuring is a suspicious activity which should be identified and reported on the SAR-MSB form.
Structuring is one of the most frequently reported activities on the SAR-MSB.