What does structuring mean in banking?

Structuring is the breaking up of transactions for the purpose of evading the Bank Secrecy Act reporting and recordkeeping requirements and, if appropriate thresholds are met, should be reported as a suspicious transaction under 31 C.F.R. § 103.18. Structuring can take two basic forms.

Are structuring deposits illegal?

Structuring is illegal regardless of whether the funds are derived from legal or illegal activity. The law specifically prohibits conducting a currency transaction with a financial institution in a way to circumvent the currency transaction reporting requirements.

What is smurfing in anti money laundering?

Smurfing is a money-laundering technique involving the structuring of large amounts of cash into multiple small transactions. Smurfing is a form of structuring, in which criminals use small, cumulative transactions to remain below financial reporting requirements.

What process of money laundering breaks cash down into smaller amounts?

In one common form of money laundering, called smurfing (also known as “structuring”), the criminal breaks up large chunks of cash into multiple small deposits, often spreading them over many different accounts, to avoid detection.

Can you structure cash withdrawals?

Structuring Money (Cash Deposits) to avoid the issuance of a Currency Transaction Report (CTR) is considered illegal. Artificially structuring (reducing) the amount of cash deposit(s), withdrawals or other cash transactions to avoid cash deposit limits (and the issuance of a CTR) is the definition of structuring.

Do banks have to report large cash deposits?

Are Banks Required to Report Large Deposits? When a cash deposit of $10,000 or more is made, the bank or financial institution is required to file a form reporting this. This form reports any transaction or series of related transactions in which the total sum is $10,000 or more.

What qualifies as structuring?

Definition. Structuring is the act of parceling what would otherwise be a large financial transaction into a series of smaller transactions to avoid scrutiny by regulators and law enforcement. Structuring appears in federal indictments related to money laundering, fraud, and other financial crimes.

What is illegal structuring?

Structuring is a strategy used by businesses that are attempting to evade taxes by hiding large amounts of cash. With structuring, companies deposit smaller amounts of cash to avoid automatic reporting by the bank to the government.

What is the term for breaking up large sums of money into smaller amounts for deposit?

One common form of money laundering is called smurfing (also known as “structuring”). This is where the criminal breaks up large chunks of cash into multiple small deposits, often spreading them over many different accounts, to avoid detection.

What involves moving funds into multiple accounts?

Layering involves moving funds around in the financial system in order to conceal the origin of the funds. Examples include, but are not limited to: Exchanging monetary instruments for larger or smaller amounts.

Is it legal to break up cash transactions into smaller amounts?

No. Breaking up transactions into smaller amounts is called “structuring.” Federal law makes it a crime to break up transactions into smaller amounts for the purpose of evading reporting requirements. If I own a business and have multiple people that conduct cash transactions on behalf of the business, who will you collect information from?

What happens if you receive a large amount of cash?

If you receive a large amount of cash, it is better to deposit it all at once. Do not break it up into smaller deposits. You could be accused of structuring, which is the illegal practice of making deposits to avoid reporting laws.

Is it illegal to break up a deposit into smaller deposits?

If you don’t want to avoid the extra steps that come with making large cash deposits, you might think about breaking the deposit into two smaller deposits. This is called “structuring” or “smurfing” and is illegal. This practice can lead to fines and jail time.

What are the rules for making large cash deposits?

Making large cash deposits requires a few extra steps because of federal government regulations. To cut down on illegal and black market activity, the Internal Revenue Service requires a bank to file a Currency Transaction Report for every deposit made over $10,000.