Bank Secrecy Basics, Part 5: An Answer To The CTR With No "Numbers"

There is one type of transaction that is not covered in depth in the Bank Secrecy Act or the instructions for the Currency Transaction Report or the Suspicious Activity Report. That is the very unique set of circumstances faced when an Amish or Mennonite person has a transaction of over $10,000 in cash. How to fill out the forms has been a problem for bankers since the CTR first came into existence. We decided to make a whole training page out of this, due to the complexity of the solutions.

Amish Customer
What do you do when an Amish person comes into your bank to open an account, or one of your Amish customers who has an account with you, (who also runs a stall in the local farmer's market), comes in with over $10,000 in cash to deposit? How do you open the account or fill out a CTR, when you have no Social Security Number (SSN), or Tax Identification Number (TIN), or what is considered "acceptable" and "recordable" identification?

New Account
Let's start with opening the account.

First, you need to have written policies and procedures for opening accounts for such individuals, so that your procedures are consistent and not discriminatory. Adhere to your policies in all cases!

The most common problem arises with the Amish and Mennonite sector, but there could be others. If you have such a person who wants to open an account, and because of religious convictions, has no social security number or tax identification number, and also may not have a driver's license or passport, there are other methods you'll have to use to identify that person.

There may be, among your other customers or members, individuals who belong to this person's congregation who can vouch for him.

You need to connect this person to a piece of real estate - an address that can be connected to his name. This can be done through reviewing pieces of mail, or production of a real estate deed, or even, (in extreme cases) physically driving out and paying a visit!

Ask if the individual has any membership cards, bills of sale, vending license or other documents that you can see and make a record of in your new account file.
Under any circumstances, satisfy yourself completely that this person is who he claims to be. Once you have done that, record in your files all you did to verify identification.

Filling Out a CTR/SAR
Again, you need to have written policies and procedures integrated into your Bank Secrecy Act policy, so that your procedures are clear and consistent. It is even more important in these situations to adhere to your policy.

NO Acceptable Identification
We'll break this into separate transactions. Generally, the first thing you should do is satisfy yourself that the customer indeed does not have, and cannot obtain acceptable ID.

If this is the case, and the individual is a customer of your bank and you have, on your records, the documentation from opening the account or any information on file, resort to those records. It may be a signature card, or a deposit account where statements are mailed out - any written record you have on this individual. You may rely upon information you have in-house to verify your identification.

In filling out the CTR, there can be several specific situations addressed. As in opening an account, the bank should make reasonable efforts to obtain identifying information about the person conducting the transactions and the person on whose behalf it is being conducted.

In the case of absolutely no identification - no social security number, no TIN, no driver's license - nothing in the way of documentation or identification - assuming the identity is true, and the procedure is consistent with your policy, and the individual is making the deposit on his own behalf, then in Part I, Section A, Line 6 and Line 14 - put down "Amish Customer" or "Mennonite Customer" (as the case may be) in both places. That's the easy one.

If a person with no identification, as in the above paragraph, is conducting the transaction on behalf of someone else, then fill out Section B. In Section B, using the illustration above, if the bank has no identification information about the person on whose behalf the transaction is made, indicate "Amish Customer" in Part I, Section B, Lines 19 and 25. With Tax ID Number, No D/L

Let's assume your customer has a tax or ID number, but does not have a driver's license or passport or other official identification. Then in Part I, Section A, Item 14 write "Amish Customer" or "Mennonite Customer" or whatever applies.

"On Behalf Of ..."

If the person conducting the transaction in 3) above is NOT the person on whose behalf the transaction is taking place, then you'll need to get both sets of information. If the transactor has a social or a TIN, record it on Item 6 or Item 19. If there is no other identification such as a driver's license, then on Item 25 write 'Amish Customer.'

If the transactor HAS identification such as a driver's license, but has no social or TIN, record the number in Part I, Section A, Item 6 or Item 19. On line 25, write 'Amish Customer.'

If the person noted in the "on behalf of" section has identification such as a social security number, note that in Section B, Item 6.

CAUTION
Financial institutions should be sensitive to the fact that if there is anything suspicious, such as the possibly fraudulent assertion of religious convictions to avoid supplying a customer's true identity, they should take reasonable steps to inquire further. If the customer's activity is determined to be suspicious within the meaning of the SAR rules, the financial institution still has an obligation to file a Suspicious Activity Report.

We again send our grateful thanks to FinCEN for their response. This has been a sticky question for a long time - we're happy to see it finally answered in detail. And thanks to our readers for being so patient while we got the absolute final answer!

Copyright © 2002 Bankers' Hotline. Originally appeared in Bankers' Hotline, Vol. 12, No. 2, 2/02