FinCEN has received significant feedback regarding the requirements to file CTRs with respect to armored car services (ACS). Financial institutions have raised concerns such as: the difficulty of obtaining personal information with respect to the ACS employee and reluctance of the employee and service provider to provide this information for personal and security reasons. FinCEN has taken into account these concerns, among others and has issued the following ruling on the “Treatment of Armored Car Service Transactions Conducted on Behalf of Financial Institution Customers or Third Parties for Currency Transaction Report Purposes.”
FinCEN provides the following:
- Financial institutions are required to implement adequate procedures to determine whether an ACS is acting pursuant to instructions from the financial institution, from the financial institution’s customer, or from a third party.
- If the delivery to or pick-up from the financial institution (corresponding to a deposit to or withdrawal from a financial institution’s customer’s account) was performed by an ACS acting pursuant to instructions from the reporting financial institution, the customer would have to be identified in Section I of the CTR, but only box 24 of Section II (“Armored Car (FI Contract”) would need to be checked to satisfy the CTR requirements regarding the ACS.
- If the delivery to or pick-up from the financial institution was performed by an ACS pursuant to instructions received from the financial institution’s customer or from a third party, the financial institution must complete the CTR as follows:
- The deliveries to and pick-ups from the financial institution conducted by the ACS pursuant to instructions from the financial institution’s customer or from a third party on any one business day will be aggregated with any other currency transactions performed on behalf of the same customer on the same business day. 5
- If the financial institution has knowledge that the aggregate of all currency deposits or withdrawals by or on behalf of a customer on any one business day exceeds $10,000, the financial institution will file a CTR identifying the customer and all persons conducting transactions (including the ACS and, if applicable, third parties on whose instructions the ACS conducted transactions) about whom the financial institution has obtained identifying information.6
- In the case of an ACS that, acting pursuant to instructions from a person other than the reporting financial institution itself, makes a delivery to or pick-up from a customer’s account in excess of $10,000 on any one business day, the financial institution will satisfy the requirement to identify the party conducting the transaction by filling in the ACS’s corporate information (corporate name, address, EIN, etc.). The name of the employee of the ACS will not be required.
- If the financial institution has knowledge that the same ACS makes several deliveries or pick-ups below $10,000 to or from the account of the same customer on any one business day (regardless of the person pursuant to whose instructions the ACS transactions were conducted), for a total exceeding $10,000, the transactions will be aggregated for purposes of filing a CTR with respect to the customer.
- The financial institution’s reporting obligation regarding transactions conducted by an ACS pursuant to instructions from the financial institution’s customer or from a third party is satisfied by filing CTRs aggregated by customer only.
- If, in spite of implementing adequate procedures, the financial institution is unable to determine on whose instruction a specific ACS reportable transaction was conducted within the period allowed for the filing of the corresponding CTR, the financial institution may satisfy its CTR requirements by identifying the financial institution’s customer and the ACS that conducted the transaction. The financial institution’s obligation to identify the ACS shall be satisfied by filling in the ACS’s corporate information (corporate name, address, EIN, etc.). The identifying information of the ACS employee is not required.
Confused?? Well… Good news… FinCEN provided an “Appendix I” full of examples to use based on different situations. IF you frequently complete CTRs for armored car service transactions, I encourage you to read this new ruling, as it may provide some relief.
Have a great weekend.