| From:
Bill Mosby (PEOPLES) [mailto:billmosby@peoplesbankga.com]
Sent: Thursday, February 17, 2005 9:59 AM
To: regs.comments@federalreserve.gov; Comments; regs.comments@occ.treas.gov;
regs.comments@ots.treas.gov
Subject: EGRPRA-Bank Secrecy Act
Subject:
EGRPRA Burden Reduction Comments
Bank
Secrecy Act
The
$10,000 CTR reporting threshold should be increased
from $10,000. The $10,000 threshold is very burdensome,
especially for a small community bank, because
it causes excessive numbers of reports to be filed.
If the threshold had been indexed to inflation
in 1979, the reporting amount now would be $26,952!
Or, put another way, the $10,000 now is like reporting
on $3,700 in 1979! The threshold should be set
at $25,000 and indexed to inflation every year
or three years. Failure to index is a guarantee
that the reporting requirement will become burdensome
and intrusive over time.
Not
only is the $10,000 very burdensome on those who
must submit the reports, it is cluttering up the
system with CTRs which undoubtedly have some value,
but not enough value to justify the cost and burden
of filing, data entry, storage and retrieval.
The
$10,000 threshold for CTRs also has the direct
effect of causing Suspicious Activity Reports (SAR)
to be filed for structuring transactions in amounts
slightly below the $10,000 threshold. Such “structuring” SARs
account for almost 50% of the SAR’s filed!
Many of these SARs are cluttering up the Suspicious
Activity Report system with reports whose value
is less then the cost of filing, entering and storing
them. Regulators have complained about defensive
SAR filings, and about how they degrade the system;
the $10,000 CTR filing requirement has the effect
of degrading both the CTR and SAR systems in exactly
the same manner as defensive SAR filings do, by “cluttering
the radar scope” with so much volume that
it is more difficult for the users of the system
to see the really important information. It is
also driving up the cost of a system that must
process and store a quantity of data in excess
of proven needs, and in excess of the ability of
law enforcement to make use of it. Increasing the
CTR reporting threshold thus would also directly
benefit the SAR system, by reducing the number
of “structuring” SARs that are filed,
and uncluttering the system.
W.
R. Mosby, CRCM
Peoples Bank, Lithonia, Georgia
P. O. Box 438
Lithonia, Georgia 30058
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