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How Information Governance Best Practices Can Help Credit Unions Avoid Liability for Inaccurate Credit Transaction Reports

Credit unions that don’t keep accurate currency transaction report records can face heavy fines. Applicable US federal law states that records substantiating these reports need to be kept for 5 years. 

Credit unions that file inaccurate currency transaction reports face fines of $500 for each report plus late filing penalties of $10,000 if a required CTR is not filed within 15 days of the transaction, with further fines of $10,000 for each day a required report is not filed. To make matters worse, a pattern of negligent violations is subject to a fine of up to $50,000, and a forfeiture of the funds involved. 

And, in case you thought that this was a “simple” process, credit unions must be able to generate this report for any currency transaction for the purchase of credit union check, cashier’s check, money order, or traveler’s check and must be able to aggregate these currency transactions to determine if a member or account made more than $10,000 in transactions during a day.

Here are 3 ways that credit unions can leverage information governance best practices to avoid liability for filing inaccurate CTRs:

Establish Clear Policies and Procedures that specifically relate to CTR filing and outline the step-by-step process of identifying, documenting, and reporting currency transactions that meet the reporting thresholds. And, perhaps most importantly – regularly train staff on those procedures!

Institute strong data quality controls to ensure accuracy in the information collected for CTR filings such as verifying customer identification information, transaction details, and any other relevant data points, regularly audit the quality of information entered into the system and ensure that your data quality system allows you to correct errors and submit information when required by law.

Regularly conduct internal audits to assess compliance with CTR reporting requirements to review the accuracy of filed reports, adherence to established policies, and the effectiveness of data quality controls and document corrective actions taken to demonstrate a commitment to compliance and continuous improvement.

By incorporating these information governance best practices, credit unions can significantly reduce the risk of filing inaccurate CTRs, thereby avoiding potential liability and regulatory scrutiny. It's essential to stay informed about regulatory updates and to adapt internal processes accordingly to remain compliant with the latest requirements.


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