QMy bank drilled a safe-deposit box that was considered abandoned and found over $10,000 in cash in the box. The
box owner cannot be located, and there is no deposit account in
this customer’s name on record. The bank deposited the cash to
an internal general ledger account. Presumably the amount will
ultimately be turned over to the state in accordance with applicable
abandoned property law. Should the bank complete a currency
transaction report and, if so, how should it complete the form since
there is no account and no transactor?
AFinCEN’s Resource Center acknowledges that FinCEN has no guid- ance that specifically address this scenario. However, a currency
transaction report should still be filed, as banks must file a currency
transaction report for each transaction in currency “by, through, or to the
The bank may complete the currency transaction report with the cus-
tomer’s information (based on what the bank has on file) as the “person
on whose behalf transaction was conducted,” since the box belonged to
that person, and may list the general ledger account number if that is the
account to which the funds were deposited. (Response Provided 11/2018.)
QWhen should a bank provide its privacy notice for participation loans?
AAll lenders participating in a loan provided by multiple lenders, (i.e, a participation loan) must provide the notice. The lead bank must
provide the notice when it establishes the relationship. However, the regulation allows a delay for participant banks that are not the lead bank.
If a person is the bank’s customer under a participant relationship, it is
arguably not at the customer’s election. Therefore, see §1016.4(e):
(e) Exceptions to allow subsequent delivery of notice.
( 1) You may provide the initial notice required by paragraph (a)( 1) of this
section within a reasonable time after you establish a customer relation-
(i) Establishing the customer relationship is not at the customer’s
(ii) Providing notice not later than when you establish a customer
relationship would substantially delay the customer’s transaction and
the customer agrees to receive the notice at a later time.
( 2) Examples of exceptions. (i) Not at customer’s election.
(A) In the case of financial institutions other than credit unions and financial institutions described in §1016.3 (l)( 3), establishing a customer
relationship is not at the customer’s election if you acquire a customer’s
deposit liability or the servicing rights to a customer’s loan from another financial institution and the customer does not have a choice
about your acquisition.
(B) In the case of financial institutions described in §1016.3 (l)( 3),
establishing a customer relationship is not at the customer’s election if
you acquire a customer’s loan or the servicing rights from another financial institution and the customer does not have a choice about your
acquisition. (Response Provided 11/2018.)
QA bank is refinancing a loan secured by 30 condo units in a HMDA-reportable transaction. The building has 32 units total. For
HMDA reporting purposes, should the bank report the total number of
units (i.e., 32) or just the ones being refinanced (i.e., 30)?
AThe bank should report the number of units securing the refinance loan. See Comment 3 to §1003.4(a)( 31) of Regulation C (HMDA):
Condominium and cooperative projects. For a covered loan secured by a
condominium or cooperative property, the financial institution reports
the total number of individual dwelling units securing the covered loan
or proposed to secure the covered loan in the case of an application.
For example: Assume that a covered loan is secured by 30 individual
dwelling units in a condominium property that contains 100 individual dwelling units and that the loan is not exempt from Regulation
C under § 1003.3(c)( 3). The financial institution reports 30 individual
dwelling units. (Response Provided 11/2018.) ■
ABOUT THE AUTHORS
LESLIE CALLAWAY, CRCM,
CAMS, CAFP, Director of
Compliance Outreach and
Development, along with
managers MARK KRUHM,
CRCM, CAFP, and RHONDA CASTANEDA, CRCM, serve as a compliance
resource for ABA member banks. Among other managerial duties, the team is
responsible for manning ABA’s Compliance Hotline, serving on compliance
committees, and providing content and guidance for ABA courses.
Have a question? Email email@example.com or call (800) 551-2572.
Answers do not provide, nor are they substitutes for, professional legal advice.