Loan Proceeds Disbursed in Cashiers Checks-SAR?

Question:

I have a customer who was a partial recipient of loan proceeds. He asked that his part be disbursed in several cashier's checks made payable to his son. The son then would come in and cash the checks separately. Some needed a CTR and some not. I'm trying to decide if this warrants the filing of a SAR on either the father, the son or both?

Answer:

If the total amount exceeded $10,000, the only reasonable interpretation is that they structured the transactions to avoid the filing of a CTR. My lending background is insignificant, but I question the wisdom of making a loan proceeds check payable to anyone other than the borrower or the person to whom the borrower owes money.

When you write this SAR, think very carefully about the very active role your bank played in facilitating the structuring. They could not have done this without your active assistance and it reflects a monumental lack of judgment.

First published on BankersOnline.com 7/8/13