cash at BOA

Bank of America instituted a new policy in December. Namely, it won’t accept cash deposits from a third party. For example, it would be impossible for a mother or father to deposit any amount of cash into an adult son or daughter’s account if he or she is not a cosigner on the account.

“It’s done to reduce the risk from cash transactions involving people not authorized on an account,” said Matthew Dailey, a spokesperson for Bank of America. He did not provide an example of a specific risk.

There are six Bank of America branches in the Keys — two in Key West, and one each in Marathon, Tavernier, Key Largo and Ocean Reef. According to online reports, Chase and Wells Fargo banks are taking similar steps. Other local banks are not.

First State Bank CEO Karen Sharp said banking practices are changing because of technology, but some of the larger institutions seem to be forcing changes to customer behavior.

“What we like to do at First State Bank is to add more delivery channels to our customers that are more convenient, but not restrict them,” said Sharp. “It may be more convenient for our customers to use a mobile banking smartphone app that lets them make a deposit on Sunday, or drop by the branch on Tuesday and do it in person. Having choices, that’s what is important for us to offer our customers.”

While Bank of America still accepts other methods of third-party transfers into accounts — mobile payment transfers, checks or money orders — the cash deposits are no longer accepted. Because there is no dollar limit on the cash deposit, it’s possible some banks are seeking ways to lessen the burdens institutions face when dealing with cash, whether that’s extra security measures or even the regularity of armored transport. In the past, some major banks have created new revenue streams by making drive-through services free, while charging a fee for the very same lobby services.

First State Bank allows the deposits from third parties into its account holders, especially when it comes to “charity” accounts set up to benefit individuals facing a medical crisis, or nonprofits during the holidays. Naturally, neither the bank nor the account holders wish to publicize the account numbers, for fear of fraud, and so the public wishing to donate can simply approach a teller.

“We set up hundreds of those,” said First State Bank’s Angie Walterson.

Those who wish to deposit cash into a First State Bank personal account are best served by coming not only with the account holder’s name, but also the account number. In cases of a very common name — John Smith, for example — the banks and the depositors want to ensure accuracy. And sometimes customers have more than one account, or an account deemed “dormant” from lack of activity.

There’s one other legitimate reason for banks not to accept cash deposits — “money mules.” Just like “drug mules,” these people are witting or unwitting dupes in a money laundering scheme. This is more prevalent in Europe, although it has popped up in the U.S. It’s more common that this a completely online transaction, although some mules will visit banking centers to deposit or withdraw cash that is then forwarded to the crime lords. Here, scammers usually target either university students on a temporary visa or those who respond to “work at home” job advertisements. The scammers require personal banking account numbers. Willing or informed participants provide the information and keep a percentage of the deposit. Unwilling participants could provide their banking information and have a personal account completely cleaned out.

“Caveat emptor” applies not only to selecting the bank with the best practices and services, but also to arming oneself against the increasingly savvy tech scams that are abundant.

$9,999.00

The “$9,999.00” rule has nothing to do with the newest banking trend about disallowing cash deposits and therefore triggering a report, or an investigation, into a cash deposit of more than $10,000. That rule, instituted in 1970, generates a “completely innocuous” Customer Transaction Report (CTR), according to a local banking official. The trouble arises, she said, when a customer attempts to disguise the cash infusion by making multiple deposits at various branches, or some other type of chicanery. That can instigate a SAR — a Suspicious Activity Report. It’s the nature of the deposit, not just the amount, that regulators investigate. “No one cares about an $11,000 deposit,” she said.

 

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