Raising the threshold of $10,000 for reporting large cash transactions – or expanding criteria to allow for further exemption from reporting – is among recommendations made in a report by the congressional watchdog, issued Wednesday.
The reports, known as currency transaction reports (CTRs), are required to be filed by financial institutions, casinos and others for any cash transactions of more than $10,000 each day. The reports are used by law enforcement to combat money laundering, among other crimes, resulting from drug trafficking, terrorism, fraud, and other criminal activities.
However, the Government Accountability Office (GAO) said, the volume of reports filed has increased by 62% since 2002. “The reporting threshold hasn’t been updated for inflation since it was set in the 1970s – which may have contributed to the increase,” the GAO said in its report. “Law enforcement only used a small portion of total reports during our review.”
The report notes that the $10,000 threshold was set 52 years ago by the Treasury Department and has not been adjusted since for inflation. Had it been, the report states, the threshold would stand at $72,880 in 2023. “Using an inflation-adjusted threshold would have reduced the number of CTRs filed by at least 90% annually since 2014,” the report states.
The GAO also stated that the vast majority of CTRs largely go unused. It said that from 2014 through 2023, law enforcement agencies accessed about 5.4% of CTRs filed in the Financial Crimes Enforcement Network’s (FinCEN) Bank Secrecy Act (BSA) portal over that nine-year period. The agency said that for CTRs accessed in either FinCEN’s BSA portal or agencies’ internal systems in 2023 (the most recent full year), law enforcement agencies accessed less than 3% of CTRs filed from 2014 through 2023.
Among the recommendations, the GAO said, FinCEN could reduce the number of CTRs filed and that are not used by law enforcement by raising the reporting threshold or expanding criteria to allow for further exemptions. “These actions should be informed by an analysis of the characteristics of CTRs that have been less likely to be accessed by law enforcement,” the GAO said.
Also recommended:
- CTR data fields that are unnecessarily burdensome for filers and of little use to law enforcement should be eliminated.
- Aggregation requirements (for related transactions in one day) should be simplified and clarified.
- A performance management process that defines performance goals and measures for monitoring the usefulness of CTRs should be established.
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