Printer Friendly

IBAA URGES CHANGES IN BANK SECRECY ACT TO REDUCE COMPLIANCE COST, INCREASE EFFECTIVENESS

 WASHINGTON, May 26 /PRNewswire/ -- The Independent Bankers Association of America (IBAA) today told Congress that the Bank Secrecy Act contributes greatly to the regulatory burden, while doing little to combat money laundering. Congress and the regulatory agencies should make substantial changes to improve the effectiveness and reduce the cost of the law, IBAA said.
 Testifying before the House Banking Committee, IBAA President-elect John Shivers said the cost of complying with the Bank Secrecy Act should be weighed against the benefits derived. A recent IBAA study showed that community banks spend more than 2 million hours and nearly $60 million a year complying with the law.
 Shivers, chairman/president/CEO of Southwest Bank, Fort Worth, Texas, said the law creates mountains of needless paperwork. Banks file millions of currency transaction reports (CTR) with the Internal Revenue Service -- recording each cash transaction over $10,000 -- yet few prosecutions result.
 "Clearly, this is one regulation that does not meet any reasonable cost-benefit test," Shivers said. "While banks can help law enforcement uncover illicit money laundering, the current system results in excess cost and over-reporting that benefits no one."
 Kerry Anthony, speaking on behalf of IBAA, agreed. The vast number of CTRs overwhelms not only banks, but also the government, said Anthony, executive vice president of the First National Bank of Herminie, Irwin, Penn.
 "Recently, the government returned a CTR along with a very threatening cover letter which outlined the substantial consequences for the bank and its employees for failure to comply," he said. "I reviewed the CTR and determined there was no error. We called the agency and they agreed, explaining that they get millions of forms a day and they sometimes get confused."
 Shivers recommended cutting the paperwork burden by raising the CTR reporting level above $10,000. He also urged an increase in the trigger level for the requirement that banks log each transaction over $3,000. The levels should be regularly adjusted to account for inflation and other economic factors.
 In addition, flexible exemption procedures would eliminate unnecessary CTRs, Shivers said. Community banks know their customers and can readily determine whether they operate legitimate businesses. Banks should have more latitude in deciding which businesses qualify for exemptions from CTR requirements.
 IBAA is the only national trade association that exclusively represents the interests of the nation's community banks.
 -0- 5/26/93
 /CONTACT: Steve Verdier of the Independent Bankers Association of America, 202-659-8111/


CO: Independent Bankers Association of America ST: District of Columbia IN: FIN SU: LEG

TW -- DC002 -- 2330 05/26/93 09:30 EDT
COPYRIGHT 1993 PR Newswire Association LLC
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1993 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:PR Newswire
Date:May 26, 1993
Words:425
Previous Article:COMMERCIAL INTERTECH CORP. REPORTS RECORD SECOND QUARTER SALES
Next Article:OPTELECOM AWARDED NIGHT VISION SYSTEMS CONTRACT WORTH UP TO $1,296,000
Topics:


Related Articles
IBAA OPPOSES MANDATORY ELECTRONIC FILING OF BANK CALL REPORTS
IBAA URGES REGULATORS TO ACT 'WITH RESTRAINT AND REASON'
IBAA URGES CONGRESS TO SUPPORT INCREASED SBA FUNDING
TRADE GROUP SAYS 'NO' TO NEW FARM CREDIT POWERS
REASONABLE BALANCE URGED BETWEEN SAFETY AND SOUNDNESS AND COMMUNITY BANKS' REGULATORY BURDEN
NEXT STEP IN MARCH TOWARD REGULATORY RELIEF BELONGS TO EXAMINERS, CONGRESS, SAYS IBAA
IBAA URGES FEDERAL HOME LOAN BANK SYSTEM TO EXPAND COMMUNITY BANK MEMBERSHIP
IBAA URGES CONGRESS TO MAINTAIN SBA LOAN GUARANTEE PROGRAM
IBAA UNVEILS REGULATORY-RELIEF LEGISLATION
IBAA OPPOSES TAXING BANKS AND THEIR CUSTOMERS TO BAIL OUT HOLDERS OF THRIFT INDUSTRY DEBT

Terms of use | Copyright © 2017 Farlex, Inc. | Feedback | For webmasters