ML Question 2

Money Laundering – Frequently Asked Questions (p. 2)

What is a Cash Transaction Report?

A Cash Transaction Report (CTR), technically known as IRS Form 8300, must be filed with the IRS for any and all cash dealings over $10,000. This is a requirement that applies to all businesses. It is also required if the total amount over a 12-month period exceeds $10,000.


Must the identity of the account owner be disclosed in a CTR?

In general, yes. However, when an attorney opens the account in question and when there are “special circumstances,” pursuant to the attorney-client privilege, the identity of the owner may be withheld.

You must make certain that your attorney REFUSES to identify you when opening the account. This is crucial because your attorney-client privilege may be jeopardized in the future, if it is deemed by the Court to have already been previously compromised.

In such a situation, if a banker demands to know the source of the funds, your attorney is obligated to tell him that the source is privileged information. If the banker notifies law enforcement, your attorney may also so notify them that divulging the nature and disclosing the source of the funds (which may also be the source of the legal fees) is breaching the attorney-client privilege.


How did the Attorney-Client privilege evolve?

The courts determined that a just defense is only possible when the accused is permitted to communicate with counsel without the fear that his attorney is an agent for the Government.


For how long are banks and other financial institutions required to maintain their records?

Traditionally, banks and other financial institutions are required to keep and maintain records of every cash transaction of $3,000 or more for 5 years.