Compliance and Banking Basics Flashcards

A customer deposits $6,000 cash in the morning and returns that afternoon to deposit $5,000 more cash into the same account. What is the representative's obligation?

Answer: Aggregate the deposits and file a Currency Transaction Report because the same-day total exceeds $10,000

Multiple cash transactions by or for the same person in one business day are aggregated, and totals over $10,000 require a CTR.

A customer asks a teller how to split a $15,000 cash deposit so that no government form gets filed. What does this request most likely indicate?

Answer: Attempted structuring that may warrant a Suspicious Activity Report

Breaking up cash to evade CTR filing is structuring, which is a federal crime even when the funds are legitimate.

After a bank files a Suspicious Activity Report on a customer, the customer asks the representative whether any report was filed about them. How should the representative respond?

Answer: Decline to disclose any information about a SAR, since disclosure is prohibited

Federal law prohibits disclosing a SAR or its existence to the subject, which is known as tipping off.

Under Customer Identification Program rules, which four pieces of information must a bank obtain from an individual before opening an account?

Answer: Name, date of birth, address, and identification number

CIP requires at minimum the customer's name, date of birth, address, and an identification number such as an SSN.

A new customer's name appears to match an entry on the OFAC Specially Designated Nationals list. What should the representative do first?

Answer: Escalate to the compliance/BSA officer to verify the match before proceeding

Potential OFAC hits must be escalated to compliance to confirm or clear the match before any transaction proceeds.

How long must banks generally retain Bank Secrecy Act records such as CTRs and SARs with their supporting documentation?

Answer: Five years

BSA recordkeeping rules generally require retention of these records for five years.

A customer buys a $4,000 cashier's check with cash. What BSA requirement applies to this transaction?

Answer: The bank must record purchaser information for monetary instrument sales of $3,000 to $10,000 in cash

Cash purchases of monetary instruments between $3,000 and $10,000 require the bank to verify and record purchaser information.