Money Laundering: The Volume of Currency Transaction Reports Filed Can and Should Be Reduced

GAO discussed proposed legislation to reduce the volume of currency transaction reports (CTR) filed that have no law enforcement value. GAO noted that: (1) the Department of the Treasury maintains two databases of Bank Secrecy Act (BSA) data; (2) federal law enforcement agencies use BSA data to detect trends and develop leads on possible money laundering activities and to track large cash transactions; (3) six states have agreements with the Treasury to receive BSA data pertaining to them on magnetic tape and four other states require filers to send copies of their BSA reports to them; (4) the usefulness of CTR data is limited because access to the data is cumbersome, particularly for state agencies, and the volume of data makes analysis difficult, expensive, and time-consuming; (5) Treasury is evaluating and testing several initiatives to facilitate state law enforcement agencies' access to CTR data; (6) between 30 and 40 percent of CTR filed are reports on routine deposits by large businesses; (7) Treasury has exempted certain businesses from CTR requirements under certain circumstances, but most banks are reluctant to use the exemption because of their confusion and concern about procedures and liability; (8) CTR could be reduced by half if the reporting threshold is increased to $20,000; (9) businesses file 92.3 percent of all CTR; and (10) the proposed legislation would reduce the number of CTR filed by exempting certain categories of transactions from reporting requirements and shield institutions from liability under normal circumstances.