BSA/AML Student Exercises Dec. 2022

• Increased in the frequency or amounts of currency deposits made by US business accounts holders who export to countries who have lenient money laundering laws. • Cash purchases of Cashier's Checks by non-customers in amounts slightly less than $10,000. It is Bank policy to NOT issue Cashier's Checks to non-customers. • Structuring of cash transactions in an apparent attempt to avoid having the Bank file a CTR, (i.e., frequent deposits or withdrawals slightly less than $10,000.) • Large deposits of Cashier's Checks and/or Money Orders drawn on Banks out of the area. • Exchange of currency, such as exchanging of small denominations of U.S. currency for larger or vice versa. • An individual who makes large cash deposits when the business is not the type of business to produce substantial amounts of cash. • A person whose individual or corporate accounts show virtually no normal business-related banking activities and who used those accounts primarily as temporary repositories for funds which are ultimately transferred to a foreign bank account. • Corporate accounts whose transactions, both deposits and withdrawals, are dominated by cash rather than by forms commonly used in commercial transactions such as checks, loan proceeds, letters of credit or bankers’ acceptances. • A business (check casher) that begins to deposit an unusual amount of cash. Unless the business is closing, a check casher will be requesting large amounts of cash and depositing checks. The BSA officer must be contacted immediately since this account may be Money Service Business that requires additional account information to keep in compliance. • Business Account that has several changes in ownership or control in a short period of time (less than one year). • An individual or business who maintains several bank accounts for no apparent reason. Red Flags for Customer Service/New Account Representatives/Safe Deposit Staff • A customer who does not live or work in the Bank's trade area but seeks to open an account with no apparent reason, such as higher rates on savings accounts. • A customer who cannot provide documentation for his current address or insists on using a P.O.Box. Please remember that the BSA does not allow the Bank to open an account with only a P.O. Box — the Bank must obtain a physical address. Customers may use P.O. Boxes as mailing addresses. • A customer who opens an account with a large amount of cash (over $10,000). Please note that many customers use cash, and this fact is not automatically suspicious by itself. However, you should inquire about the source of funds and alert your supervisor and the BSA officer that the account should receive more intense monitoring until the normal pattern can be ascertained. • A customer who refuses to provide identification or other information needed for a new account. Do not open the account and notify your supervisor or the BSA officer. • Retail banking customers who inquire about foreign transactions, including wire transfers. This is not a suspicious activity by itself, but you should alert your supervisor and the BSA officer that the account should receive more intense monitoring until the normal pattern can be ascertained. • A customer who requests a safe deposit box but has no other relationship at the Bank. It is unusual for customers to have a safe deposit box at a financial institution unless they have other account relationships. — AJ&R Bank does not open customer storage boxes for non-account holders. • A customer visits his or her safe deposit box on an unusually frequent basis. • The pattern of traffic to a safe deposit box changes. For example, several people enter a box together when only one person has used the box in past. • Large amounts of cash are maintained in a safe deposit box. You may notice this as a customer cashes a large check at the teller window and then goes directly to his or her safe deposit box.

For Training Purposes Only

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