FinCEN answers CTR Questions: Part II

John J. Byrne



As promised in last month's issue, here are more answers to common questions being asked regarding the new Currency Transaction Reports (CTR) Form 4789. For a complete list of questions and answers, call Treasury's Financial Crimes Enforcement Network at (800) 949-2732.

Identification requirements
Q: Is a U.S. passport acceptable identification since it does not contain an address and is not specifically listed in the regulation?

A: Yes, for purposes of completing the new CTR, a U.S. passport is acceptable. Although verification of an address by official document or other means (e.g. through credit bureaus) is desirable, acceptable identification may be made by any official document containing a name and photograph preferably with an address that is normally acceptable by financial institutions as a means of identification when cashing checks for nondepositors.

Q: What is a cedular card?

A: A cedular card is the term used for a personal identification card issued by foreign governments, particularly in Latin America and Spain, to citizens above a certain age and within certain categories (excluding certain >
Q: What should be included on additional sheets attached to the original CTRL

A: In order for attached sheets to be clearly associated with the original CTR, attached sheets should have as much identifying information as possible including:
(1) the name of the bank filing the form and (2) the date of the transaction. At a minimum, all attached sheets of paper should include: (1) the name of the person or organizations on whose behalf the transaction is conducted and (2) the social security or employer identification number.

Q: When should the box for "multiple persons" be checked?

A: Multiple person transactions are those conducted by or on behalf of two or more individuals, on behalf of two or more organizations, or on behalf of at least one individual and at least one organization. In these cases, box "1 b" should be checked.

Q: Do all holders of the account, even if they do not come to the bank, need to be put on the revised CTR as "Person(s) on Whose Behalf Transaction is Included?

A: For deposits, all those who are known to benefit from the transaction must be identified on the CTR. However, if a person makes a withdrawal from a joint account, only his name needs to be listed as the beneficiary of the transaction if: (1) he states that the withdrawal is on his own behalf or the financial institution knows that the person making the withdrawal is the only beneficiary, and (2) the financial institution has no reason to believe otherwise.

Q: When should the box for "multiple transactions" be checked?

A: Multiple transactions are any two or more transactions which the financial institution has knowledge are conducted by or on behalf of any person during the same business day and which result in a total cash-in or cash-out of over $10,000. In these cases, box "lc" (multiple transactions) should be checked. Example: A customer places one deposit bag into the night depository at a bank on Friday night, two bags on Saturday and two on Sunday. Then on Monday morning, a teller processes all five deposit bags and deposit slips at the same time, but posts each individual deposit separately.

This should be reported as a multiple transaction. However, if the customer places one bag containing the five deposits in the night depository over a weekend, and the teller processes the deposit on Monday morning - totalling the five deposits and showing a single cash-in transaction, the financial institution may report it as a single transaction so that the CTR reflects the financial institution's records.

Part I: Section A Person(s) on Whose Behalf Transactions) is Conducted
One of the major changes on the new CTR is the reversal of Sections A and B from the old CTR: Persons) on Whose Behalf Transactions) is Conducted, which was Section B on the old CTR, is now Section A, and Individuals) Conducting Transaction(s), which was formerly Section A, is now Section B. This was done to place a greater emphasis on all those who benefit from (the beneficiaries of) the transaction by noting that information first in Section A.

Q: Must the financial institution note whether the number provided in Item 6 is a social security number (SSN) or an employer identification number (EIN) since there is no separate configuration of spaces?

A: It is not necessary to note whether the number in Item 6 is an SSN or. EIN, and the revised CTR has been simplified to eliminate the separate configuration of these numbers because they may be differentiated solely on the basis of their initial numbers. IRS Service Centers assign EINs, which start with numbers not assigned to SSNs; whereas, the Social Security Administration assigns SSNs, which start with numbers not assigned to EINs.

Q: While an SSN or EIN is required on a CTR, if a CTR is filed without an SSN or EIN, should the financial institutions amend the CTR if it subsequently obtains an SSN or EIN? (Items 6 and 19)

A: Yes, the CTR should be amended if an SSN or EIN is subsequently obtained.

Q: Are the terms "homemaker," "retired," or "unemployed" acceptable as descriptions for occupations? (Item 13)

A: "Homemaker," "retired," or "unemployed," are acceptable as occupation descriptions, but financial institutions should attempt to get more specific information. As a basic part of "know your customer" programs, financial institutions should pay particular attention to customers with such nonspecific occupations who continually make large cash deposits. "Self-employed" is not acceptable without additional information as it is too nonspecific.

Part I-Section B Individual(s) Conducting Transactions) (if other than above)
Instructions state that financial institutions should enter as much information as is available in Section B. Does this mean that if it is not available, then they do not have to provide it? Should the financial institution refuse to conduct the transaction if the customer refuses to provide the required information?

The law requires financial institutions to file complete and accurate CTRs. The CTR Form 4789 indicates the only circumstances in which incomplete data is acceptable (e.g., Armored Car Service, Mail Deposit or Shipment, etc.). If a financial institution elects to conduct a transaction for which it files an incomplete CTR other than for these specified circumstances, then it should attach an explanation of why the CTR is incomplete.

Q: If box "a" in Section B is checked for Armored Car Service, should the provider's name be inserted?

A: No, the Armored Car Service provider's name does not have to be recorded on the CTR.

Q: Is box "d" for Multiple Transactions on the revised CTR's Part I-Section B the same as the old CTR's Part I, box 3d? If so, what is considered a "reasonable effort" for obtaining information when the aggregation of multiple transactions has exceeded the reporting threshold? (Part I, Section B box d: Multiple Transactions)

A: Yes. And it should be checked to indicate that some or all of the information required in Items 15 to 25 is missing because the transaction being reported is a multiple transaction. A reasonable effort to obtain information for reporting multiple transactions when aggregate exceeds the reporting threshold might include a check of bank records, telephone calls to customers and obtaining information from tellers who handled the multiple transaction. However, if complete information is still not obtained, then box "d" in Part I-Section B must be checked to explain why.

Copyright © 1995 Bank Security & Fraud Prevention. Originally appeared in Bank Security & Fraud Prevention, Vol. 2, No. 10, 10/95