History

• Congress passed the Bank Secrecy Act in 1970. The law has been revisited, revised and expanded numerous times over the decades. The most recent major revision came as part of the USA Patriot Act, passed after the attacks of Sept. 11, 2001 and that, among other things, sought to choke off sources of terrorists' financing.
  
  

Laundering

• "Money laundering" refers to any scheme that makes it appear as if money from a criminal enterprise was actually generated by a legitimate business. The Internal Revenue Service estimates total money laundering worldwide at $1 trillion to $2 trillion a year. Since so much of the criminal economy is conducted in cash, a central tactic in the fight against money laundering centers on identifying large cash transactions.
  
  

CTR

• The heart of the Bank Secrecy Act is the Currency Transaction Report or CTR. Any financial institution that processes a deposit, withdrawal, transfer or other transaction involving more than $10,000 in cash must keep records of the transaction and file a CTR with the government. It's important to note that large-scale cash transactions are not illegal in and of themselves; the government requires the CTR, so it can review such transactions for suspicious activity.
  
  To prevent money launderers from getting around the CTR provision by moving cash in smaller chunks, the secrecy act requires banks and others to treat multiple transactions as a single transaction if they believe they all came from the same person and they total more than $10,000. To prevent criminals from laundering money simply by buying and reselling various items, businesses that receive cash payments over $10,000 are required to report them to the IRS.
  
  

Shipments

• The Bank Secrecy Act requires that any person or institution shipping or mailing more than $10,000 in currency into or out of the country must file a form with U.S. Customs declaring the shipment. "Currency" in these instances includes, among other things, U.S. and foreign cash, traveler's checks, money orders and any financial instruments payable to the bearer.
  
  

FBAR

• Any U.S. person or institution with at least $10,000 deposited in foreign countries, such as in a bank account or a mutual fund, must file a Foreign Bank and Financial Accounts Report (FBAR), with the Treasury Department. The $10,000 is an aggregate total. If you have that much deposited abroad, regardless of how many accounts it's in, you have to file a FBAR.
  
  

SAR

• The final major requirement of the Bank Secrecy Act is the Suspicious Activity Report or SAR. Regardless of the size of a transaction, any financial institution that has reason to suspect that money is being laundered through an account is required to file an SAR with the Financial Crimes Enforcement Network, an arm of the Treasury Department.