Discover our latest AI-powered innovations around faster payments, smarter workflows, and real-time visibility.Learn more →
A currency transaction report (CTR) is a report made by U.S. financial institutions aiming to prevent money laundering.
Every bank must fill out a CTR report electronically and file it with the Financial Crimes Enforcement Network (FinCEN) whenever a customer attempts to withdraw, deposit, transfer, or exchange more than $10,000 (i.e., $10,000.01 or more) in cash in one day—over one or multiple transactions. In some cases, a CTR may also be filed for smaller transactions, particularly if a customer seems to be deliberately avoiding the $10,000 threshold (sometimes called “structuring”).
History of the Currency Transaction Report
Financial institutions didn’t have to use the CTR until 1970 when President Richard Nixon signed the Bank Secrecy Act (BSA) into law. The BSA was established to stop criminals from using the banking system to hide their "ill-gotten gains" or launder money. The law was strengthened over the years, including after the September 11, 2001 terrorist attacks.
What Purpose Does a Currency Transaction Report Serve?
A CTR protects the banking industry from threats caused by people committing financial crimes. The goal of the anti-money laundering regulation is to deter criminals who try to hide the money they obtained illegally.
This law also applies to cryptocurrency businesses. For example, if a cryptocurrency ATM operator's client tries to purchase bitcoin with more than $10,000 in cash from one of their machines, the operator must file a CTR. In addition, if that business person also operates a cryptocurrency exchange, and a client tries to sell more than $10,000 worth of bitcoin in one day, they must file a cryptocurrency CTR.
How Does a Currency Transaction Report Work?
Whenever a bank's customer initiates a transaction of more than $10,000, the institution's banking software will automatically generate a currency transaction report. Generally, the software will autofill the relevant customer data and tax information on the form. If there are signs that a transaction of more than $10,000 may be suspicious, a bank employee can mark a CTR so that it triggers a suspicious activity report (SAR).
A financial institution doesn’t have to tell a customer if their transaction triggers a CTR, but the bank officer must disclose that information if the customer asks. Although the customer can cancel the transaction when they're alerted to the CTR requirement, it's too late to prevent the bank from reporting it. If the customer refuses to complete the transaction or modifies it so that it amounts to less than $10,000, the bank must file a suspicious activity report with FinCEN.
However, these entities are exempt from this requirement:
- An agency or department of a local, state, or federal government.
- A U.S. bank.
- Certain corporations with stocks traded on the New York Stock Exchange, Nasdaq, and the American Stock Exchange.
Try Modern Treasury
See how smooth payment operations can be.
Learn
Compliance is a crucial function for any company that moves money on behalf of their customers. Dive into the fundamentals behind key compliance processes like KYC, KYB, transaction monitoring, and more.
Compliance risk management (CRM) is the ongoing process of identifying, assessing, and mitigating potential risks that threaten an organization’s business.
Customer due diligence (CDD) is a process used at financial institutions (FIs) when working with potential new customers.
The Customer Identification Program (CIP), part of the Know Your Customer program guidelines, requires that financial institutions in the U.S. verify that customers (both individuals and businesses) are who they say they are when they open new accounts for themselves or other people.
FinCEN, short for Financial Crimes Enforcement Network, is a government bureau that aims to prevent money laundering and other financial crimes—and punish bad actors that commit them.
Know Your Business (KYB) is a set of verification procedures that helps companies avoid getting into business with criminals.
The Office of the Comptroller of the Currency (OCC) is a federal agency that "charters, regulates, and supervises" all national banks.
According to the Department of Labor (DOL), Personal Identifiable Information (PII) is any information from which a person’s identity can be either directly or indirectly inferred.
A Politically Exposed Person (PEP) is someone that might be more likely to break the law or be corrupt because of the power their position affords them.
Specially Designated Nationals (SDN) are individuals and entities tied to countries that the U.S. Department of the Treasury's Office of Foreign Assets Control (OFAC) has hit with sanctions.
A Suspicious Activity Report (SAR) is a report that a bank or other financial institution must file if it suspects that a customer might be breaking the law and committing fraud, financing terrorism, or laundering money.
Anti-money laundering (or AML) compliance entails a careful adherence to rules and regulations aimed at combating illicit financial activities.
Know Your Customer or Know Your Client (KYC) is a set of guidelines for verifying the identity of a customer and gauging the associated risk of working with them.
The Office of Foreign Assets Control (OFAC) is a financial intelligence and enforcement agency under the jurisdiction of the US Treasury Department.
PCI DSS certification means your business has met the requirements laid out in the Payment Card Industry Data Security Standard (PCI DSS) to secure payment card data.
Service Organization Control 2 (SOC 2) is a voluntary auditing procedure that service providers complete to keep their clients’ data secure from cyber attacks.
Section 314(a) is part of the USA Patriot Act that enables financial institutions (FIs) and law enforcement to work together to fight money laundering and terrorist activity.
Section 314(b) and Section 314(a) of the USA Patriot Act both relate to information requests under the Banking Secrecy Act (BSA).
A currency transaction report (CTR) is a report made by U.S. financial institutions aiming to prevent money laundering.
An Agent of the Payee is a person, entity, or other intermediary specifically appointed by a payee to process and collect payments on their behalf.
Identity Verification APIs allow businesses to streamline the process of checking the identities of new users by automatically, and in some cases instantly, verifying their provided identifying information.
The Bank Secrecy Act (BSA)—also known as the Currency and Foreign Transactions Reporting Act—is a piece of legislation designed to help prevent fraud.
The Electronic Fund Transfer Act (EFTA) is a federal law in the U.S. that regulates electronic transactions to protect consumers.