A group of Senate Republicans have introduced legislation to increase reporting thresholds for currency transaction reports (CTRs) and suspicious activity reports (SARs) under the Bank Secrecy Act (BSA).
The BSA was established in 1970 to identify illicit financial activity. The legislation requires banks, credit unions, and other financial institutions to assist government agencies with detecting and preventing financial crimes such as money laundering, terrorism financing, and other criminal abuse. Currently, financial institutions are required to report certain financial transactions. A currency transaction report is required for cash transactions exceeding $10,000, and a suspicious activity report is required for transactions exceeding $2,000 or $5,000 depending on the circumstances.
The Streamlining Transaction Reporting and Ensuring Anti-Money Laundering Improvements for a New Era Act (STREAMLINE Act) would raise these thresholds from $10,000 to $30,000, $2,000 to $3,000, and $5,000 to $10,000 respectively. Further, it requires the Treasury Department to adjust these amounts every five years to account for inflation.
“For decades, banks and credit unions have been weighed down by outdated reporting requirements and layers of unnecessary paperwork that make it harder for them to serve consumers and small businesses. By increasing the reporting thresholds for currency transaction reports and suspicious activity reports, we are bringing much-needed modernization to a law that should root out financial crimes, not get in the way of everyday Americans,” Sen. Tim Scott (R-SC), chairman of the Senate Banking Committee, and one of the bill’s sponsors, said.
The bill is also sponsored by Sens. John Kennedy (R-LA), Mike Crapo (R-ID), Mike Rounds (R-SD), Bill Hagerty (R-TN), Cynthia Lummis (R-WY), Katie Britt (R-AL), Pete Ricketts (R-NE), and Bernie Moreno (R-OH).
“Washington’s financial reporting requirements may have made sense in the seventies, but in today’s economy, they simply weigh down our financial institutions. My STREAMLINE Act cuts red tape and modernizes these requirements, so law enforcement can focus on real criminals – not debanking hardworking Americans or drowning our financial institutions in burdensome paperwork. It’s time to bring the Bank Secrecy Act into the 21st century and use a little common sense,” Kennedy said.
The American Bankers Association, America’s Credit Unions, and the Independent Community Bankers of America all support the legislation.
“Financial institutions face unnecessary burdens from outdated reporting requirements that impede service to customers and small businesses. The STREAMLINE Act delivers long overdue modernization, helping to ensure the Bank Secrecy Act targets true financial crime instead of generating excessive paperwork,” Crapo said.