CUNA: CTR exemption bill promising for CUs

WASHINGTON (8/14/08)—A bill that would exempt certain customers from currency transaction report (CTR) rules, as well as streamline that exemption process, was introduced in the House just before Congress recessed for its August District Work Session.

Rep. Barney Frank (D-Mass.), who heads the House Financial Services Committee, and Reps. Bill Foster (D-Ill.) and Dennis Moore (D-Kan.), both committee members, introduced H.R. 6688, the Seasoned Customer CTR Exemption Act of 2008, on July 31. It shares the name and some provisions with legislation introduced by Rep. Spencer Bachus (R-Ala.), currently the ranking member of the committee, in 2006 and 2007.

Nichole Seabron, federal compliance counsel for the Credit Union National Association (CUNA), said the bill combines the earlier seasoned customer legislation and the Financial Crimes Enforcement Network's (FinCEN's) recent CTR revision proposal issued earlier this summer.

"It is definitely something that would impact credit unions in a favorable manner," Seabron said.

She highlighted the provisions she believes will be of most importance to credit unions.

The bill impacts CTR exemption requirements. For instance, it would do away with the Phase I filing requirement for transactions between credit unions and other depository institutions, such as other credit unions, banks or corporate credit unions.

The provisions also call for the removal of the biennial renewal requirement for Phase II exemptions--those pertaining to non-listed businesses and payroll customers.

The bill gives credit unions more flexibility in determining when to grant exemptions and would allow them to grant exemptions within 2 months versus the 12-month requirement that is currently in place.

Also, the bill provides for a "seasoned customer" exemption to CTR filing requirements, although it is not yet clear to what extent the exemption will benefit credit unions. The "seasoned customer" exemption would be applied to business account customers, such as incorporated/registered businesses, including sole proprietorships.

courtesy of cuna.org