[Code of Federal Regulations]

[Title 31, Volume 1]

[Revised as of July 1, 2005]

From the U.S. Government Printing Office via GPO Access

[CITE: 31CFR103.22]



[Page 382-388]

 

                  TITLE 31--MONEY AND FINANCE: TREASURY

 

                       DEPARTMENT OF THE TREASURY

 

PART 103_FINANCIAL RECORDKEEPING AND REPORTING OF CURRENCY AND FOREIGN 

TRANSACTIONS--Table of Contents

 

                  Subpart B_Reports Required To Be Made

 

Sec. 103.22  Reports of transactions in currency.



    (a) General. This section sets forth the rules for the reporting by 

financial institutions of transactions in currency. The reporting 

obligations themselves are stated in paragraph (b) of this section. The 

reporting rules relating to aggregation are stated in paragraph (c) of 

this section. Rules permitting banks to exempt certain transactions from 

the reporting obligations appear in paragraph (d) of this section.

    (b) Filing obligations--(1) Financial institutions other than 

casinos. Each financial institution other than a casino shall file a 

report of each deposit, withdrawal, exchange of currency or other 

payment or transfer, by, through, or to such financial institution which 

involves a transaction in currency of more than $10,000, except as 

otherwise provided in this section. In the case of the Postal Service, 

the obligation contained in the preceding sentence shall not apply to 

payments or transfers made solely in connection with the purchase of 

postage or philatelic products.

    (2) Casinos. Each casino shall file a report of each transaction in 

currency, involving either cash in or cash out, of more than $10,000.

    (i) Transactions in currency involving cash in include, but are not 

limited to:

    (A) Purchases of chips, tokens, and plaques;

    (B) Front money deposits;

    (C) Safekeeping deposits;

    (D) Payments on any form of credit, including markers and counter 

checks;

    (E) Bets of currency;



[[Page 383]]



    (F) Currency received by a casino for transmittal of funds through 

wire transfer for a customer;

    (G) Purchases of a casino's check; and

    (H) Exchanges of currency for currency, including foreign currency.

    (ii) Transactions in currency involving cash out include, but are 

not limited to:

    (A) Redemptions of chips, tokens, and plaques;

    (B) Front money withdrawals;

    (C) Safekeeping withdrawals;

    (D) Advances on any form of credit, including markers and counter 

checks;

    (E) Payments on bets, including slot jackpots;

    (F) Payments by a casino to a customer based on receipt of funds 

through wire transfer for credit to a customer;

    (G) Cashing of checks or other negotiable instruments;

    (H) Exchanges of currency for currency, including foreign currency; 

and

    (I) Reimbursements for customers' travel and entertainment expenses 

by the casino.

    (c) Aggregation--(1) Multiple branches. A financial institution 

includes all of its domestic branch offices, and any recordkeeping 

facility, wherever located, that contains records relating to the 

transactions of the institution's domestic offices, for purposes of this 

section's reporting requirements.

    (2) Multiple transactions--general. In the case of financial 

institutions other than casinos, for purposes of this section, multiple 

currency transactions shall be treated as a single transaction if the 

financial institution has knowledge that they are by or on behalf of any 

person and result in either cash in or cash out totaling more than 

$10,000 during any one business day (or in the case of the Postal 

Service, any one day). Deposits made at night or over a weekend or 

holiday shall be treated as if received on the next business day 

following the deposit.

    (3) Multiple transactions--casinos. In the case of a casino, 

multiple currency transactions shall be treated as a single transaction 

if the casino has knowledge that they are by or on behalf of any person 

and result in either cash in or cash out totaling more than $10,000 

during any gaming day. For purposes of this paragraph (c)(3), a casino 

shall be deemed to have the knowledge described in the preceding 

sentence, if: any sole proprietor, partner, officer, director, or 

employee of the casino, acting within the scope of his or her 

employment, has knowledge that such multiple currency transactions have 

occurred, including knowledge from examining the books, records, logs, 

information retained on magnetic disk, tape or other machine-readable 

media, or in any manual system, and similar documents and information, 

which the casino maintains pursuant to any law or regulation or within 

the ordinary course of its business, and which contain information that 

such multiple currency transactions have occurred.

    (d) Transactions of exempt persons--(1) General. No bank is required 

to file a report otherwise required by paragraph (b) of this section 

with respect to any transaction in currency between an exempt person and 

such bank, or, to the extent provided in paragraph (d)(6)(vi) of this 

section, between such exempt person and other banks affiliated with such 

bank. In addition, a non-bank financial institution is not required to 

file a report otherwise required by paragraph (b) of this section with 

respect to a transaction in currency between the institution and a 

commercial bank. (A limitation on the exemption described in this 

paragraph (d)(1) is set forth in paragraph (d)(7) of this section.)

    (2) Exempt person. For purposes of this section, an exempt person 

is:

    (i) A bank, to the extent of such bank's domestic operations;

    (ii) A department or agency of the United States, of any State, or 

of any political subdivision of any State;

    (iii) Any entity established under the laws of the United States, of 

any State, or of any political subdivision of any State, or under an 

interstate compact between two or more States, that exercises 

governmental authority on behalf of the United States or any such State 

or political subdivision;

    (iv) Any entity, other than a bank, whose common stock or analogous 

equity interests are listed on the New York Stock Exchange or the 

American Stock Exchange or whose common



[[Page 384]]



stock or analogous equity interests have been designated as a Nasdaq 

National Market Security listed on the Nasdaq Stock Market (except stock 

or interests listed under the separate ``Nasdaq Small-Cap Issues'' 

heading), provided that, for purposes of this paragraph (d)(2)(iv), a 

person that is a financial institution, other than a bank, is an exempt 

person only to the extent of its domestic operations;

    (v) Any subsidiary, other than a bank, of any entity described in 

paragraph (d)(2)(iv) of this section (a ``listed entity'') that is 

organized under the laws of the United States or of any State and at 

least 51 percent of whose common stock or analogous equity interest is 

owned by the listed entity, provided that, for purposes of this 

paragraph (d)(2)(v), a person that is a financial institution, other 

than a bank, is an exempt person only to the extent of its domestic 

operations;

    (vi) To the extent of its domestic operations and only with respect 

to transactions conducted through its exemptible accounts, any other 

commercial enterprise (for purposes of this paragraph (d), a ``non-

listed business''), other than an enterprise specified in paragraph 

(d)(6)(viii) of this section, that:

    (A) Has maintained a transaction account, as defined in paragraph 

(d)(6)(ix) of this section, at the bank for at least 12 months;

    (B) Frequently engages in transactions in currency with the bank in 

excess of $10,000; and

    (C) Is incorporated or organized under the laws of the United States 

or a State, or is registered as and eligible to do business within the 

United States or a State; or

    (vii) With respect solely to withdrawals for payroll purposes from 

existing exemptible accounts, any other person (for purposes of this 

paragraph (d), a ``payroll customer'') that:

    (A) Has maintained a transaction account, as defined in paragraph 

(d)(6)(ix) of this section, at the bank for at least 12 months;

    (B) Operates a firm that regularly withdraws more than $10,000 in 

order to pay its United States employees in currency; and

    (C) Is incorporated or organized under the laws of the United States 

or a State, or is registered as and eligible to do business within the 

United States or a State.

    (3) Initial designation of exempt persons--(i) General. A bank must 

designate each exempt person with which it engages in transactions in 

currency by the close of the 30-day period beginning after the day of 

the first reportable transaction in currency with that person sought to 

be exempted from reporting under the terms of this paragraph (d). Except 

as provided in paragraph (d)(3)(ii) of this section, designation by a 

bank of an exempt person shall be made by a single filing of Treasury 

Form TD F 90-22.53. (A bank is not required to file a Treasury Form TD F 

90-22.53 with respect to the transfer of currency to or from any of the 

twelve Federal Reserve Banks.) The designation must be made separately 

by each bank that treats the person in question as an exempt person, 

except as provided in paragraph (d)(6)(vi) of this section. The 

designation requirements of this paragraph (d)(3) apply whether or not 

the particular exempt person to be designated has previously been 

treated as exempt from the reporting requirements of prior Sec. 

103.22(a) under the rules contained in 31 CFR 103.22(a) through (g), as 

in effect on October 20, 1998 (see 31 CFR Parts 0 to 199 revised as of 

July 1, 1998). A special transitional rule, which extends the time for 

initial designation for customers that have been previously treated as 

exempt under such prior rules, is contained in paragraph (d)(11) of this 

section.

    (ii) Special rules for banks. When designating another bank as an 

exempt person, a bank must either make the filing required by paragraph 

(d)(3)(i) of this section or file, in such a format and manner as FinCEN 

may specify, a current list of its domestic bank customers. In the event 

that a bank files its current list of domestic bank customers, the bank 

must make the filing as described in paragraph (d)(3)(i) of this section 

for each bank that is a new customer and for which an exemption is 

sought under this paragraph (d).



[[Page 385]]



    (4) Annual review. The information supporting each designation of an 

exempt person, and the application to each account of an exempt person 

described in paragraphs (d)(2)(vi) or (d)(2)(vii) of this section of the 

monitoring system required to be maintained by paragraph (d)(9)(ii) of 

this section, must be reviewed and verified at least once each year.

    (5) Biennial filing with respect to certain exempt persons--(i) 

General. A biennial filing, as described in paragraph (d)(5)(ii) of this 

section, is required for continuation of the treatment as an exempt 

person of a customer described in paragraph (d)(2)(vi) or (vii) of this 

section. No biennial filing is required for continuation of the 

treatment as an exempt person of a customer described in paragraphs 

(d)(2)(i) through (v) of this section.

    (ii) Non-listed businesses and payroll customers. The designation of 

a non-listed business or a payroll customer as an exempt person must be 

renewed biennially, beginning on March 15 of the second calendar year 

following the year in which the first designation of such customer as an 

exempt person is made, and every other March 15 thereafter, on Treasury 

Form TD F 90-22.53. Biennial renewals must include a statement 

certifying that the bank's system of monitoring the transactions in 

currency of an exempt person for suspicious activity, required to be 

maintained by paragraph (d)(9)(ii) of this section, has been applied as 

necessary, but at least annually, to the account of the exempt person to 

whom the biennial renewal applies. Biennial renewals also must include 

information about any change in control of the exempt person involved of 

which the bank knows (or should know on the basis of its records).

    (6) Operating rules--(i) General rule. Subject to the specific rules 

of this paragraph (d), a bank must take such steps to assure itself that 

a person is an exempt person (within the meaning of the applicable 

provision of paragraph (d)(2) of this section), to document the basis 

for its conclusions, and document its compliance, with the terms of this 

paragraph (d), that a reasonable and prudent bank would take and 

document to protect itself from loan or other fraud or loss based on 

misidentification of a person's status, and in the case of the 

monitoring system requirement set forth in paragraph (d)(9)(ii) of this 

section, such steps that a reasonable and prudent bank would take and 

document to identify suspicious transactions as required by paragraph 

(d)(9)(ii) of this section.

    (ii) Governmental departments and agencies. A bank may treat a 

person as a governmental department, agency, or entity if the name of 

such person reasonably indicates that it is described in paragraph 

(d)(2)(ii) or (d)(2)(iii) of this section, or if such person is known 

generally in the community to be a State, the District of Columbia, a 

tribal government, a Territory or Insular Possession of the United 

States, or a political subdivision or a wholly-owned agency or 

instrumentality of any of the foregoing. An entity generally exercises 

governmental authority on behalf of the United States, a State, or a 

political subdivision, for purposes of paragraph (d)(2)(iii) of this 

section, only if its authorities include one or more of the powers to 

tax, to exercise the authority of eminent domain, or to exercise police 

powers with respect to matters within its jurisdiction. Examples of 

entities that exercise governmental authority include, but are not 

limited to, the New Jersey Turnpike Authority and the Port Authority of 

New York and New Jersey.

    (iii) Stock exchange listings. In determining whether a person is 

described in paragraph (d)(2)(iv) of this section, a bank may rely on 

any New York, American or Nasdaq Stock Market listing published in a 

newspaper of general circulation, on any commonly accepted or published 

stock symbol guide, on any information contained in the Securities and 

Exchange Commission ``Edgar'' System, or on any information contained on 

an Internet World-Wide Web site or sites maintained by the New York 

Stock Exchange, the American Stock Exchange, or the National Association 

of Securities Dealers.

    (iv) Listed company subsidiaries. In determining whether a person is 

described in paragraph (d)(2)(v) of this section, a bank may rely upon:



[[Page 386]]



    (A) Any reasonably authenticated corporate officer's certificate;

    (B) Any reasonably authenticated photocopy of Internal Revenue 

Service Form 851 (Affiliation Schedule) or the equivalent thereof for 

the appropriate tax year; or

    (C) A person's Annual Report or Form 10-K, as filed in each case 

with the Securities and Exchange Commission.

    (v) Aggregated accounts. In determining the qualification of a 

customer as a non-listed business or a payroll customer, a bank may 

treat all exemptible accounts of the customer as a single account. If a 

bank elects to treat all exemptible accounts of a customer as a single 

account, the bank must continue to treat such accounts consistently as a 

single account for purposes of determining the qualification of the 

customer as a non-listed business or payroll customer.

    (vi) Affiliated banks. The designation required by paragraph (d)(3) 

of this section may be made by a parent bank holding company or one of 

its bank subsidiaries on behalf of all bank subsidiaries of the holding 

company, so long as the designation lists each bank subsidiary to which 

the designation shall apply.

    (vii) Sole proprietorships. A sole proprietorship may be treated as 

a non-listed business if it otherwise meets the requirements of 

paragraph (d)(2)(vi) of this section, as applicable. In addition, a sole 

proprietorship may be treated as a payroll customer if it otherwise 

meets the requirements of paragraph (d)(2)(vii) of this section, as 

applicable.

    (viii) Ineligible businesses. A business engaged primarily in one or 

more of the following activities may not be treated as a non-listed 

business for purposes of this paragraph (d): serving as financial 

institutions or agents of financial institutions of any type; purchase 

or sale to customers of motor vehicles of any kind, vessels, aircraft, 

farm equipment or mobile homes; the practice of law, accountancy, or 

medicine; auctioning of goods; chartering or operation of ships, buses, 

or aircraft; gaming of any kind (other than licensed parimutuel betting 

at race tracks); investment advisory services or investment banking 

services; real estate brokerage; pawn brokerage; title insurance and 

real estate closing; trade union activities; and any other activities 

that may be specified by FinCEN. A business that engages in multiple 

business activities may be treated as a non-listed business so long as 

no more than 50% of its gross revenues is derived from one or more of 

the ineligible business activities listed in this paragraph 

(d)(6)(viii).

    (ix) Exemptible accounts of a non-listed business or payroll 

customer. The exemptible accounts of a non-listed business or payroll 

customer include transaction accounts and money market deposit accounts. 

However, money market deposit accounts maintained other than in 

connection with a commercial enterprise are not exemptible accounts. A 

transaction account, for purposes of this paragraph (d), is any account 

described in section 19(b)(1)(C) of the Federal Reserve Act, 12 U.S.C. 

461(b)(1)(C), and its implementing regulations (12 CFR part 204). A 

money market deposit account, for purposes of this paragraph (d), is any 

interest-bearing account that is described as a money market deposit 

account in 12 CFR 204.2(d)(2).

    (x) Documentation. The records maintained by a bank to document its 

compliance with and administration of the rules of this paragraph (d) 

shall be maintained in accordance with the provisions of Sec. 103.38.

    (7) Limitation on exemption. A transaction carried out by an exempt 

person as an agent for another person who is the beneficial owner of the 

funds that are the subject of a transaction in currency is not subject 

to the exemption from reporting contained in paragraph (d)(1) of this 

section.

    (8) Limitation on liability. (i) No bank shall be subject to penalty 

under this part for failure to file a report required by paragraph (b) 

of this section with respect to a transaction in currency by an exempt 

person with respect to which the requirements of this paragraph (d) have 

been satisfied, unless the bank:

    (A) Knowingly files false or incomplete information with respect to 

the transaction or the customer engaging in the transaction; or



[[Page 387]]



    (B) Has reason to believe that the customer does not meet the 

criteria established by this paragraph (d) for treatment of the 

transactor as an exempt person or that the transaction is not a 

transaction of the exempt person.

    (ii) Subject to the specific terms of this paragraph (d), and absent 

any specific knowledge of information indicating that a customer no 

longer meets the requirements of an exempt person, a bank satisfies the 

requirements of this paragraph (d) to the extent it continues to treat 

that customer as an exempt person until the date of that customer's next 

periodic review, which, as required by paragraph (d)(4) of this section, 

shall occur no less than once each year.

    (iii) A bank that files a report with respect to a currency 

transaction by an exempt person rather than treating such person as 

exempt shall remain subject, with respect to each such report, to the 

rules for filing reports, and the penalties for filing false or 

incomplete reports that are applicable to reporting of transactions in 

currency by persons other than exempt persons.

    (9) Obligations to file suspicious activity reports and maintain 

system for monitoring transactions in currency. (i) Nothing in this 

paragraph (d) relieves a bank of the obligation, or reduces in any way 

such bank's obligation, to file a report required by Sec. 103.21 with 

respect to any transaction, including any transaction in currency that a 

bank knows, suspects, or has reason to suspect is a transaction or 

attempted transaction that is described in Sec. 103.21(a)(2)(i), (ii), 

or (iii), or relieves a bank of any reporting or recordkeeping 

obligation imposed by this part (except the obligation to report 

transactions in currency pursuant to this section to the extent provided 

in this paragraph (d)). Thus, for example, a sharp increase from one 

year to the next in the gross total of currency transactions made by an 

exempt customer, or similarly anomalous transaction trends or patterns, 

may trigger the obligations of a bank under Sec. 103.21.

    (ii) Consistent with its annual review obligations under paragraph 

(d)(4)of this section, a bank shall establish and maintain a monitoring 

system that is reasonably designed to detect, for each account of a non-

listed business or payroll customer, those transactions in currency 

involving such account that would require a bank to file a suspicious 

transaction report. The statement in the preceding sentence with respect 

to accounts of non-listed and payroll customers does not limit the 

obligation of banks generally to take the steps necessary to satisfy the 

terms of paragraph (d)(9)(i) of this section and Sec. 103.21 with 

respect to all exempt persons.

    (10) Revocation. The status of any person as an exempt person under 

this paragraph (d) may be revoked by FinCEN by written notice, which may 

be provided by publication in the Federal Register in appropriate 

situations, on such terms as are specified in such notice. Without any 

action on the part of the Treasury Department and subject to the 

limitation on liability contained in paragraph (d)(8)(ii) of this 

section:

    (i) The status of an entity as an exempt person under paragraph 

(d)(2)(iv) of this section ceases once such entity ceases to be listed 

on the applicable stock exchange; and

    (ii) The status of a subsidiary as an exempt person under paragraph 

(d)(2)(v) of this section ceases once such subsidiary ceases to have at 

least 51 per cent of its common stock or analogous equity interest owned 

by a listed entity.

    (11) Transitional rule. (i) No accounts may be newly granted an 

exemption or placed on an exempt list on or after October 21, 1998, 

under the rules contained in 31 CFR 103.22(b) through (g), as in effect 

on October 20, 1998 (see 31 CFR Parts 0 to 199 revised as of July 1, 

1998).

    (ii) If a bank properly treated an account (a ``previously exempted 

account'') as exempt on October 20, 1998 under the rules contained in 31 

CFR 103.22(b) through (g), as in effect on October 20, 1998 (see 31 CFR 

Parts 0 to 199 revised as of July 1, 1998), it may continue to treat 

such account as exempt under such prior rules with respect to 

transactions in currency occurring on or before June 30, 2000, provided 

that it does so consistently until the earlier of June 30, 2000, and the 

date on which the



[[Page 388]]



bank makes the designation or the determination described in paragraph 

(d)(11)(iii) of this section. A bank that continues to treat a 

previously exempted account as exempt under the prior rules, and for the 

period, specified in the preceding sentence, shall remain subject to 

such prior rules, and to the penalties for failing to comply therewith, 

with respect to transactions in currency occurring during such period.

    (iii) A bank must, on or before July 1, 2000, either designate the 

holder of a previously exempted account as an exempt person under 

paragraph (d)(2) of this section or determine that it may not or will 

not treat such holder as an exempt person under paragraph (d)(2) of this 

section (so that it will be required to make reports under paragraph (a) 

of this section with respect to transactions in currency by such person 

occurring on or after the date of determination, but no later than July 

1, 2000). A bank that initially does not designate the holder of a 

previously exempted account as an exempt person for periods beginning 

after June 30, 2000, may later make such a designation, to the extent 

otherwise permitted to do so by this paragraph (d), for periods after 

the effective date of such designation.



(Approved by the Office of Management and Budget under control number 

1506-0009)



[63 FR 50156, Sept. 21, 1998, as amended at 65 FR 46360, July 28, 2000]