Money Laundering

Banks accounted for virtually all of the 9 million currency transaction reports filed in 1992. The reports described about $418 billion in cash transactions by companies and individuals. More than half of the reports were for transactions of $20,000 or less. Businesses--more than 364,000 in all--accounted for upwards of 90 percent of the reports filed and for $412 billion of the total dollar amount of the transactions reported. When a report cites more than one business or individual, a separate record is established in the databases for each entity shown on the report. The 8.2 million reports filed on businesses produced 9.2 million records. The 100 businesses listed on the most reports during 1992--primarily chain stores and restaurants--accounted for 13 percent of these records. Treasury regulations allow banks to exempt certain types of businesses from reporting transactions that do not exceed a set dollar limit. Data on the number of businesses exempted are unavailable. But 1.2 million of the 9.2 million records from 1992 resulted from transactions that exceeded the dollar limit on exemptions. In addition, Internal Revenue Service officials estimated that as many as 40 percent of all reports filed could qualify for exemptions.

GAO found that: (1) the 100 businesses listed as having the most CTR records during 1992 accounted for 13 percent of the total CTR records filed and 22 percent of the total transaction amount reported for businesses; (2) Treasury regulations permit banks to exempt certain types of businesses from CTR reporting requirements for transactions that do not exceed a specified dollar limit; (3) other types of businesses may also be exempted with Treasury's approval, but some businesses are ineligible for any type of exemption; (4) 13 percent of the total CTR business records filed were the result of transactions that exceeded the dollar limit for exemptions; and (5) Internal Revenue Service officials have estimated that between 30 and 40 percent of all CTR records filed could qualify for exemptions.