CBT Banking Regulations and Compliance 2 — Questions and Answers
Question 1: A customer deposits $6,000 in cash in the morning and returns in the afternoon to deposit another $5,000 in cash into the same account. What must the teller do?
- Nothing, because each deposit is under $10,000
- File a Currency Transaction Report because same-day cash deposits are aggregated (Correct answer)
- File a Suspicious Activity Report only
- Refuse the second deposit until the next business day
Correct answer: File a Currency Transaction Report because same-day cash deposits are aggregated
Under the BSA, multiple cash transactions by or for the same person on one business day are aggregated, and totals over $10,000 require a CTR.
Question 2: Within how many calendar days after the transaction must a Currency Transaction Report be filed with FinCEN?
- 5 days
- 10 days
- 15 days (Correct answer)
- 30 days
Correct answer: 15 days
A CTR must be filed within 15 calendar days after the date of the reportable transaction.
Question 3: A customer asks the teller how to avoid 'all that government paperwork' and then splits $12,000 into two deposits of $6,000 on different days. This activity is best described as:
- Layering
- Structuring (Correct answer)
- Kiting
- Smurfing exemption
Correct answer: Structuring
Breaking up cash transactions to evade CTR reporting is structuring, which is a federal crime regardless of the source of funds.
Question 4: After a bank files a Suspicious Activity Report, the customer asks the teller whether a report was filed about them. What should the teller do?
- Confirm it so the customer can explain the activity
- Deny that any report exists
- Not disclose the SAR or its existence to the customer (Correct answer)
- Refer the customer to FinCEN for a copy
Correct answer: Not disclose the SAR or its existence to the customer
Federal law prohibits disclosing a SAR or any information that would reveal its existence to the subject of the report.
Question 5: Which piece of information is NOT required to be collected under the minimum Customer Identification Program (CIP) rules when opening an account for an individual?
- Name
- Date of birth
- Residential or business address
- Employer's name (Correct answer)
Correct answer: Employer's name
Section 326 of the USA PATRIOT Act requires name, date of birth, address, and an identification number at minimum, not employer information.
Question 6: A teller's system shows a customer's name is a potential match on the OFAC SDN list. What is the appropriate next step?
- Complete the transaction and note it in the file
- Stop the transaction and escalate to the compliance/BSA officer to verify the match (Correct answer)
- Ask the customer if they are on the OFAC list
- Close the account immediately and return all funds in cash
Correct answer: Stop the transaction and escalate to the compliance/BSA officer to verify the match
Potential OFAC hits must be held and escalated for verification, since a confirmed match may require blocking or rejecting the transaction.
Question 7: How long must banks generally retain BSA records such as CTRs and SARs with supporting documentation?
- 2 years
- 3 years
- 5 years (Correct answer)
- 7 years
Correct answer: 5 years
BSA recordkeeping rules require most records, including CTRs and SARs, to be kept for five years.
