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Bank Secrecy Act

Overview#

Bank Secrecy Act of 1970 requires Financial Institutions in the United States to assist United States Federal Agency in Anti-Money Laundering.

Specifically, the act requires Financial Institutions to keep records of cash purchases of negotiable instruments, and file reports of cash purchases of these negotiable instruments of more than $10,000 (daily aggregate amount), and to report suspicious activity that might signify money laundering, Tax Evasion, or other criminal activities.

Internal Revenue Service uses form 8300 for Bank Secrecy Act reporting.[2]

Bank Secrecy Act is administrated by the Financial Crimes Enforcement Network (FinCEN).

Bank Secrecy Act places a high Regulatory Burden

Bank Secrecy Act requires that Financial Institutions MUST keep records of cash transactions summing to more than $10,000 in one day and report suspicious transactions to the United States federal government. In addition, people coming into the United States from foreign countries (including US citizens) must declare cash or other negotiable instruments they are bringing into the country if the amount exceeds $10,000.

One hidden cost of inflation is that it makes an increasingly large share of cash holdings and transactions subject to Government Surveillance. As an Example, $10,000 in 1970 is equivalent to $65,000 in 2018.

More Information#

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