What is a common finding TCA sees in exempting eligible customers from CTR reporting?


During independent audits, TCA tests for initial and annual due diligence reviews of exempt customers. There are four requirements for a Phase II exemption. 

  • Five transactions that exceed reporting thresholds in a 12-month period.
  • The customer has a transaction account for at least 2 months.
  • The customer is organized in a U.S. State.
  • The customer doesn’t derive more than 50% of its revenue from illegible activity.

In recent audits, TCA notes the institutions are not retaining evidence of Secretary of State website searches to verify that the business is organized in a State and is still in good standing. A screen print from the website demonstrating that the business is still in good standing satisfies the requirement and should be included in the annual due diligence documentation.

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