Legal Compliance Flashcards

Under FinCEN rules, a money services business (MSB) must file a Suspicious Activity Report for suspicious transactions involving at least what amount?

Answer: $2,000

31 CFR 1022.320 sets the MSB SAR threshold at $2,000, lower than the $5,000 threshold for banks.

How many calendar days does a financial institution generally have to file a SAR after first detecting facts that may justify a filing?

Answer: 30 days

A SAR is due within 30 days of initial detection, extendable to 60 days if no suspect has been identified.

Which federal statute specifically criminalizes operating an unlicensed money transmitting business, often charged against crypto mixer operators?

Answer: 18 U.S.C. § 1960

18 U.S.C. § 1960 prohibits unlicensed money transmitting and was charged in cases such as Bitcoin Fog and Helix.

In United States v. Gratkowski (5th Cir. 2020), the court held that a user's records held by Coinbase were:

Answer: Not protected because of the third-party doctrine

The court found no reasonable expectation of privacy in exchange records voluntarily shared with a third party.

A crypto exchange employee tells a customer that a SAR was filed on their account. Which legal rule has been violated?

Answer: SAR confidentiality (anti-tipping-off) rule

Federal law prohibits disclosing a SAR or any information that would reveal its existence.

Which OFAC enforcement principle means a U.S. exchange can be penalized for processing a transaction with a sanctioned address even without knowing it was sanctioned?

Answer: Strict liability

OFAC civil penalties apply on a strict liability basis, so intent is not required.

Under the general federal statute of limitations (18 U.S.C. § 3282), most non-capital federal crimes must be charged within:

Answer: 5 years

The default federal limitations period for non-capital offenses is five years.