The Justice Department has been advocating for bank tellers across the US to call police on their customers who withdraw $5,000 or more in cash.
"A senior official from the Justice Department spoke to a group of bankers about the need for them to rat out their customers to the police," said investor and financial blogger Simon Black.
Banks are already required to file a "Suspicious Activity Report" (SAR) should they suspect an unusual activity. But now the feds are saying these suspicious reports are not enough.
"[W]e encourage those institutions to consider whether to take more action: specifically, to alert law enforcement authorities about the problem, who may be able to seize the funds, initiate an investigation, or take other proactive steps," the official told Black.
So, how do these institutions know when to take action?
As stated in the Federal Financial Institution Examination Council handbook, banks are obligated to file a SAR when "transactions conducted or attempted by, at, or through the bank (or an affiliate) and aggregating $5,000 or more…"
Such order justifies the banks’ submission of these suspicious activity reports for perfectly legal actions as simple as withdrawing cash, especially that they are required by the federal government to submit a certain number of SARs a month for investigation.
Banks could lose their banking charter and face fines if they don’t meet the quota.
Banks like Chase are imposing other capital control strategies, such as mandating identification for depositing cash and banning cash deposit into another person’s account.
In 2014, banks filed more than 700,000 suspicious activity reports.