Topic: Bank Secrecy Act & Anti-Money Laundering (BSA/AML)
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How long should we retain guardianship documents that we requested from customers to open checking and savings accounts after the accounts have been closed?
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We recommend retaining the guardianship documents for five years after the accounts have been closed or become dormant. FinCEN’s Bank Secrecy Act rules require banks to retain any identifying information required by their Customer Identification Program (CIP) for five years after the account is closed or becomes dormant. If the guardianship documents were not required…
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One of our customers has a freestanding ATM that recently was converted to be a payout device connected to a gaming machine. He is registered with the Illinois Gaming Board. Does he also need to keep the ATM registered with the state? What kind of due diligence is required?
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Yes, if the ATM terminal continues to dispense cash from customers’ bank accounts, your customer should maintain its registration as a nonbank ATM with the Illinois Department of Financial and Professional Regulation. Because your customer now is operating a video gaming terminal, we do recommend some heightened monitoring due to the many requirements in the…
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We have a potential customer that is a property management company. At another institution, the company maintains separate operating accounts and reserve accounts for each different property that it manages. The company would like to move all of these accounts to our institution. Can we execute one master resolution and one signature card to cover all of the separate accounts that it would open at our bank? The property management company would be the sole signer on all of the accounts.
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We are not aware of any law or regulation that would prohibit you from executing one master resolution and one signature card to cover all of the customer’s separate accounts. For business customers, the FFIEC’s BSA/AML Examination Manual recommends that you obtain a corporate resolution authorizing the directors to open the account or appointing a…
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What areas of compliance training are required for new hires? Is there a time frame that the training must be completed?
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Illinois law requires that new employees at financial institutions receive training regarding the financial exploitation of older adults within six months of their hire date and every three years after that. This requirement applies only to employees who have direct customer contact. In addition, there are several federal regulations and guidances that require compliance training…
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A husband and wife both withdrew cash from their joint deposit account on the same day. Both withdrawals were under $10,000 but totaled over $10,000. We decided to aggregate the withdrawals and file a currency transaction report (CTR) because they were made for the same reason (to pay for a medical procedure for the husband’s mother). Were we right to aggregate the transactions, or should we file an amended CTR?
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We believe it was appropriate to aggregate the transactions. Because both of the withdrawals from the spouses’ joint account benefitted the husband, the CTR filing requirements appear to require aggregation. In general, multiple transactions in a single day should be aggregated when “the financial institution has knowledge that they are by or on behalf of…
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Are we permitted to retain copies of driver’s licenses in our files for deposit accounts? Should we be retaining these copies?
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Yes, we believe that you may retain copies of driver’s licenses in deposit account files, although it is not required. There may be some risk when retaining copies of driver’s licenses or other IDs in loan files or with loan applications, as we discuss below, but those risks do not apply to deposit account files.…
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What is our bank’s responsibility for ensuring that funds from lottery ticket sales are deposited in segregated accounts? Some of our customers sell lottery tickets without maintaining segregated accounts at our bank (but we do not know whether they maintain segregated accounts at other institutions).
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The Illinois Lottery Law does not impose requirements on banks to maintain segregated accounts for lottery funds; instead, it places the responsibility on the lottery sales agent. You may wish to remind customers that a failure to maintain segregated accounts for lottery proceeds is a Class 4 felony in Illinois, but you are not required…
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We have a customer who is refusing to enter a remitter for a cashier’s check. We believe that the customer should enter in a remitter, for BSA purposes. The customer is very upset and wants to leave the remitter line blank. Is there any regulation we can point to?
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We are not aware of any law or regulation that requires a bank to identify a remitter on a cashier’s check. However, both the Illinois Currency Reporting Act and FinCEN regulations require banks to obtain and record certain information for cashier’s checks issued for $3,000 or more, including the identity of the purchaser. In keeping…