Risk Management Manual of Examination Policies - FDIC

BANK SECRECY ACT, ANTI-MONEY LAUNDERING,
AND OFFICE OF FOREIGN ASSETS CONTROL
• Structured down payments or escrow money
transactions. An attempt to “structure” a down
payment or escrow money transaction may be made in
order to conceal the true source of the funds used.
• Attempt to sever the paper trail. Attempts may be
made by the customer or bank to sever any paper trail
connecting a loan to the collateral.
• Wire transfer of loan proceeds. A customer may
request that loan proceeds be wire transferred for no
apparent legitimate reason.
• Disbursement of loan proceeds by multiple bank
checks. A customer may request disbursement of loan
proceeds in multiple bank checks, each under $10,000.
The customer can then negotiate these checks
elsewhere for currency. The customer avoids the
currency transaction reporting requirements and severs
the paper trail.
• Loans to companies outside the U.S. Unusual loans
to offshore customers, and loans to companies
incorporated in “secrecy havens” are higher risk
activities.
• Financial statement. Financial statement
composition of a business differs greatly from those of
similar businesses.
Monetary Instruments
• Structured purchases of monetary instruments. An
individual or group purchases monetary instruments
with currency in amounts below the $3,000 BSA
recordkeeping threshold.
• Replacement of monetary instruments. An
individual uses one or more monetary instruments to
purchase another monetary instrument(s).
• Frequent purchase of monetary instruments
without apparent legitimate reason. A customer
may repeatedly buy a number of official bank checks
or traveler’s checks with no apparent legitimate
reason.
• Deposit or use of multiple monetary instruments.
The deposit or use of numerous official bank checks or
other monetary instruments, all purchased on the same
date at different banks or different issuers of the
instruments may indicate money laundering. These
instruments may or may not be payable to the same
individual or business.
Section 8.1
• Incomplete or fictitious information. The customer
may conduct transactions involving monetary
instruments that are incomplete or contain fictitious
payees, remitters, etc.
• Large cash amounts. The customer may purchase
cashier’s checks, money orders, etc., with large
amounts of cash.
Safe Deposit Boxes
• Frequent visits. The customer may visit a safe
deposit box on an unusually frequent basis.
• Out-of-area customers. Safe deposit boxes may be
opened by individuals who do not reside or work in
the banks service area.
• Change in safe deposit box traffic pattern. There
may be traffic pattern changes in the safe deposit box
area. For example, more people may enter or enter
more frequently, or people carry bags or other
containers that could conceal large amounts of cash.
• Large amounts of cash maintained in a safe deposit
box. A customer may access the safe deposit box after
completing a transaction involving a large withdrawal
of cash, or may access the safe deposit box prior to
making cash deposits which are just under $10,000.
• Multiple safe deposit boxes. A customer may rent
multiple safe deposit boxes if storing large amounts of
currency.
Wire Transfers
• Wire transfers to countries widely considered
“secrecy havens.” Transfers of funds to well known
“secrecy havens.”
• Incoming/outgoing wire transfers with instructions
to the receiving institution to pay upon proper
identification. The instructions to the receiving bank
are to “pay upon proper identification.” If paid for in
cash, the amount may be just under $10,000 so no
CTR is required. The purchase may be made with
numerous official checks or other monetary
instruments. The amount of the transfer may be large,
or the funds may be sent to a foreign country.
• Outgoing wire transfers requested by non-account
holders. If paid in cash, the amount may be just under
$10,000 to avoid the CTR filing requirement.
DSC Risk Management Manual of Examination Policies 8.1-43 Bank Secrecy Act (12-04)
Federal Deposit Insurance Corporation