This is the seventh part in our series that reveals exactly what banks are looking for when they are combatting money laundering.
The size and frequency of currency deposits increases rapidly with no corresponding increase in noncurrency deposits.
You know if you expect to see an uptick in your currency deposits. If you do, pay a visit to your banker and explain to her what is happening. That will forestall any unnecessary problems.
A bank is unable to track the true account holder of correspondent or concentration account transactions.
You may have an account that receives deposits from several other banks. For example, for sales made in multiple countries plus deposits from a credit card bank. If the bank thinks you aren’t the actual account owner, then they are obligated to take action. They will report it to the appropriate authorities.
The turnover in large-denomination bills is significant and appears uncharacteristic, given the bank’s location.
There is a global effort to reduce the number of large currency bills in circulation because of their anonymity. Your account will be flagged if you process many of these through your account where this is unusual.
Changes in currency-shipment patterns between correspondent banks are significant.
Transactions between correspondent banks are tracked so that if an employee manages to bypass internal controls, she will be caught. There are several triggers to be aware of:
- Large volumes of small denomination bills are sold to U.S. banks. (This is a trigger in the EuroZone as well. In that case, triggering currencies are USD, GBP and EUR.)
- Multiple wire transfer instructions from foreign nonbank institutions requiring the bank to transfer funds to entities for which there seems to be no reasonable business purpose.
- Customers exchange large volumes of USD or Euros for larger denominations. This facilitates physical cross-border shipment of currency.
- Deposits of Euros or US Dollars by a foreign non-bank entity that subsequently transfers the funds via wire to foreign non-bank entities.
Even legitimate businesses risk losing access to their funds temporarily or permanently as well as prompting an investigation of the principals if they engage in any of these activities.