“Big Brother is watching you” – that’s how many Americans feel when they deposit or withdraw large sums of money from their bank accounts.
And it’s true!
All banks regulated by the federal government are required by law to report large monetary transactions to the Financial Crimes Enforcement Network, or FinCEN, which is an office of the U.S. Department of the Treasury.
Although there is “no general prohibition against handling large amounts of currency,” according to FinCEN, banks are still required to report all monetary transactions (deposits, withdrawals, currency exchanges, or other payments or transfers) over $10,000 in a single day (by or on behalf of a person) through what is known as a Currency Transaction Report (CTR).
The main goal is to protect the financial sector from threats posed by money laundering and other financial crimes.
To comply with the law, financial institutions must collect certain information from their customers, including their Social Security number and a copy of their driver’s license or other government-issued identification.
It is possible to avoid the CTR limit of $10,000 by depositing just under that amount in cash or by splitting the deposits into smaller parts.
This is called “structuring” and can lead your bank to file a Suspicious Activity Report (SAR).
“Structuring” can occur through something as simple as selling a car for $15,000 and then depositing the cash in two batches of $7,500 on the same day – one in the morning and another in the afternoon – to two different bank employees.
If you are found guilty of “structuring,” you could face civil and criminal penalties, including up to five years in prison and a fine of up to $250,000.
So, the main point is this: if you are not doing anything illegal or participating in anything illegal and you have a lot of money to deposit, just deposit it. You are not doing anything illegal.
Source: Yahoo! Finance