Then, that is why-
The sign doesnt make that differentiation, but the law is in place to prevent money laundering (fro fraud often)- and in that case, they want to buy the most expensive cards possible, not $30.
So the cashier went for the spirit of the law, and
No one tries to launder money in those small amounts.
It’s also protecting the bank (Anti-Money Laundering / Know Your Customer laws.)
I suspect there would come a point where after warning you about scams they would hand the cash over - but by that point they have CYA’d sufficiently. Which is their goal.
They’d have to at some point, but the risk for an obstinate customer is that the bank decides to just opt out of any future problems by closing the account.
Know Your Customer laws do in fact specify a duty of CDD (customer due diligence) as far as verifying customer activity and blocking risky transactions. If they asked what you’re doing with the $4K and you stated that you were giving it to a guy on the corner in a trench coat you don’t really know, then yes, they can decide it’s too risky. Some notable elements of CDD are:
Though banks are privately owned, they are a public service. And they’re more than just places to dump your money when you’re not using it, this also carries a regulatory burden of risk assessment and management, because these are important to the health and stability of a fractional reserve banking system that runs on trust and vigilance.
If that’s not agreeable to you, then you can use a different kind of service like a safe deposit box, which carries none of the stability guarantees of a bank apart from physical security, and the bank officers are literally required to look the other way when you’re accessing the contents. Or just keep it under your mattress.
They don’t have to conduct any transaction that they feel carries too much risk to the institution or customer, or is likely illegal. At a minimum they will note the transaction to document the behavioral pattern for future reference (ah yes, we know you pay your mechanic in cash, very good sir), or they may report certain transactions to regulatory authorities.
Banks are a service that exist for the public good, they are bound by regulations that ensure they do so.
1 – The trigger for reporting cash that possibly is being used for drug dealing, money laundering, or other nefarious purposes is $10-grand, not four.
2 – They tell FinCEN, not you.
The concern was doubtless fear of elder-scam.
Perhaps in depends on your local laws, because that’s exactly what happened to me. The bank simply refused to honour my request to make a payment because they weren’t happy that the recipient was a genuine furniture business.
I was fascinated to read this reporting from NH Public Radio about how huge a business gift card scamming is (and how it resulted in a recent murder in NH).
The U.S. Department of Homeland Security has warned that “card draining” schemes organized by Chinese criminal networks have taken hundreds of millions of dollars, possibly more.
Hundreds of millions! I’ve never been one to go for those gift card racks very often, but I’m definitely done with them, now.
The trigger for cash txns is $10,000 the trigger for filing a SAR is different, it’s only $5,000 (or $2 for MSBs) & doesn’t necessarily need to involve just cash
Accotrding to your cite, the core requirements of CDD are:
Identify and verify the identity of customers
- Identify and verify the identity of the beneficial owners of companies opening accounts
- Understand the nature and purpose of customer relationships to develop customer risk profiles
- Conduct ongoing monitoring to identify and report suspicious transactions, and on a risk basis, to maintain and update customer information.
There’s nothing in those requirements that lets a bank decide that your withdrawal request is too risky and decline it. They can report it if they want, if they are not happy with my reason or refusal to provide a reason for withdrawing my money, but they are going to give me my money.
Was your request a withdrawal or a wire transfer? They are not the same thing.
The typical bank’s charter outlines that they can decline any transaction or drop you as a customer for whatever reason they see fit. That’s not part of KYC rules, it’s just the normal course of business. KYC just outlines an additional set of things that they are required by law to ask and document.
You don’t have to believe me, you can go to your bank and tell them you need $9,000 to buy a high-end stereo out of the back of the van from a guy you just met in the parking lot, who insists on a cash transaction. You’re not getting that money. Not unless you tell them that you’re closing the account and ending the relationship with the bank, and even then it likely won’t be immediate, you may face a freeze period while they investigate and verify.
You have no power over the bank, and precious little recourse if they displease you. If you’ve never had to learn this via direct experience, you’re lucky.
It was a bank transfer (I guess you call it a wire transfer), but as it was direct to an account, the bank wasn’t liable for the transaction, unlike a direct or credit card payment, so it wasn’t a case of them trying to protect themselves.
It’s also protecting the bank in another way - judging by what I read , a shocking number of people think that whenever they get scammed (or even make a mistake) with Zelle, the bank should be responsible for getting their money back. They don’t understand that whatever protections they have with credit cards or checks don’t exist with cash or Zelle. Can’t imagine those people won’t blame the bank for not asking questions about a withrawal.
You’re presenting an entirely different scenario. Volunteering that you intend to use your money for a probably illegal transaction is not the same thing as not offering a reason, and not the same thing as them asking.
As far as withdrawing that amount without questioning, I’ve actually done this. I needed $8500 to buy a vehicle, and I wanted to pay in cash. I walked into my bank, verified my identity, and requested a cash withdrawal. Their only questions were did I want it in any particular denomination, and did I want it in an envelope. They did not ask what the money was for nor did I offer an explanation, because it’s no one’s business but my own. Now if they noted in their records that I withdrew that $8500 with no explanation offered and felt my vibes made it seem little suspicious or whatever so that they have it on record in case some shady business comes up later, that’s their prerogative. They can record and report all they want, but they gave me my money, no questions asked.
Sounds like I should be annoyed with Bank of America. About 2 years ago in a fit of worry about something I decided that I should keep a significant chunk of cash on hand. Teller didn’t blink, the only problem was that she didn’t have enough fifties (I was requesting it in various denominations) and had to substitute 100s (which I had not wanted). I am (and look) old (mid-60s).
Possibly the array of denominations made it seem unlikely to be a scam.
Fine then, assume that they have asked, which KYC often requires them to do, and which is permitted by their own policy. If they ask for a reason and find it lacking, you are not getting that money, end of story. Not without demanding account closure and refund, which may not happen that same day.
And I have done this as well, in the years before KYC was so tight, or perhaps at a bank that had less restrictive internal policy. It’s nothing to do with “nobody’s business” because by statute, business conducted at a regulated and insured bank in fact is everyone’s business (to a degree).
Banks have always been within their rights to decline the withdrawal, or simply close your account because they don’t want your business, even before the PATRIOT act and KYC tightening. I have no idea how you got the confused idea that you have any power over your bank in this regard, but I’m glad you’ve never had to find out the hard way, and I’d caution you that past luck is not a guarantee of future success.
But banks are also not in the business of not giving customers their money. The interestingly, the more money you have, the more the banks are not in the “not giving you money” business.
Sort of an aside, but as someone who has spent the better part of their career delving into the operations of banks, insurance companies, and other financial institutions, I am often by surprised by the combination of intense regulatory scrutiny over the most inane of esoteric minutiae with haphazard and sloppy business processes largely run on the back of Excel and PowerPoint.
Here in Japan, there aren’t joint back accounts, so my wife and I have our own accounts.
We have automatic withdrawals setup for the accounts, and so sometimes we need to move money from one account to the other.
Her bank doesn’t care if money is transferred from my account to hers, but my bank always calls and wants to know the reason.
I asked if they couldn’t make a note that this account is from my wife, but no, there is no common sense.
If my wife is trying to scam me, she’s really inefficient. We’ve been married for 21 years and I she hasn’t requested any gift cards yet.
Also, since most of our cash withdrawals are from the ATM, we never get asked the reason for getting cash.
Excellent point, this is the nature of fractional reserve banking. They want to loan money they don’t have, which is achieved by not distributing the money they do have. And they certainly don’t want to risk any preventable loss or troublesome customers. It’s all about stability and trust. They’d rather be obstinate and inconvenient than take a preventable loss.
What always surprised me about this is how much documentation they wanted, without really caring if it actually meant anything, and the controls they wanted, with no regard to whether it controlled anything important. It’s all about generating a paper trail claiming that you followed your due diligence procedures so you could avoid getting sued or prosecuted if something went wrong.
If the paper was crap, or the review was meaningless, no matter, as long as you followed the process. If you did follow the process and somehow lost a hundred million bucks, you’re covered (at least legally, no guarantees about your job though).