The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.
FEDERAL RESERVE BANK OF DALLAS FISCAL AGENT O F THE UNITED STATES Dallas, Texas, February 28, 1952 To All Banking Institutions, and Others Concerned, in the Eleventh Federal Reserve District: At the request of the Secretary of the Treasury, the following documents relating to reports of currency transactions are being transmitted to each bank and other financial institution of this district: 1. Amended instructions relating to reports of currency transactions, dated February 21, 1952. 2. Statement for release to the Press on February 29, 1952, concerning the amended instruc tions. 3. Letter dated February 21, 1952, by the Secretary of the Treasury to the Banks of the United States and Other Financial Institutions. It will be observed that commencing with transactions occurring in the month of March 1952, every financial institution in the United States shall file with the Federal Reserve Bank of the dis trict in which the reporting financial institution is located monthly reports on Form TCR-1 concern ing each deposit or withdrawal, or other payment or transfer, effected by, through, or to such finan cial institution, which involves transactions in United States currency, as follows: 1. Transactions involving $2,500 or more of United States currency in denominations of $100 or higher; 2. Transactions involving $10,000 or more of United States currency in any denominations, and 3. Transactions involving any amount in any denominations which, in the judgment of the financial institution, exceed those commensurate with the customary conduct of the busi ness, industry or profession of the person or organization concerned. A revised report Form TCR-1 is being prepared and a supply of the new form will be forwarded to you upon request. Until the new form is available, financial institutions should file their reports on the old Form TCR-1 for those transactions covered by the amended instructions. Financial institutions located in those sections of the district assigned to the El Paso, Houston, and San Antonio branches of this bank should send their monthly reports, in duplicate, to the branch serving their section; all others should send their reports to the Federal Reserve Bank of Dallas. Yours very truly, R. R. GILBERT President This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org) THE S E C R E T A R Y OF THE T R E A S U R Y W A S HI N G T O N February 21, 1952 TO BANKS AMD OTHER FINANCIAL INSTITUTIONS; The Treasury has amended the regulation originally issued on May 21, 19U5, requiring every financial institution in the United States to file monthly reports on Form TCR-1 of large and unusual currency transactions, to make them more in keeping with present conditions* These reports were originally developed for the purpose of discovering large currency trans actions resorted to by racketeers and others engaged in illegal activities as an attempted method of concealing income. One of the most valuable sources of information to the Treasury Department in the detection of income-tax evasion are reports received from banks and other financial institutions on Form TCR-1* Mary banks and other financial institutions are regularly submitting reports of large and unusual currency transactions* Failure on the part of some institutions to file reports may be due to oversight or to a belief that the reporting requirements are no longer in effect. Heretofore, Treasury regulations required reports of all trans actions amounting to $1,000 or more involving currency denominations of $50 or higher* After consultation with the Federal Reserve Banks and a committee of the American Bankers Association, the Treasury has amended its regulation to require reports on Form TCR-1 for each transaction amounting to $ 2,500 or more, involving denominations of $100 or higher* This change is expected to render the reporting procedure less burdensome to banks, while providing the Bureau of Internal Revenue with a continuing flow of those reports which experience has shown to be the most helpful in detecting major tax evaders* I feel certain that the banks and financial institutions are in general agreement that, in fairness to all taxpayers, every effort should be made to reduce to the lowest practicable minimum the loss of revenue through tax evasion. The TCR-1 reports have been responsible for breaking many of the largest and most intricate income-tax evasion cases* The use of currency by racketeers, and others engaged in illegal activities, is particularly well established as an attempted method of concealing income* When such income is not detected the burden of taxation is heavier on the honest taxpayers* Although this amended regulation is designed to assist primarily the increased enforcement efforts directed against racketeers, it is recognized that it will apply in certain cases to other persons, firms or corporations. However, it is not intended to apply to a currency transaction which, in f.he judgment of the reporting financial institution, is a normal one in the regular and customary conduct of business or private activities* The TCR-1 reports are treated as confidential communications* All officers and agents of the Bureau of Internal Revenue have been admon ished not to disclose the source of information received through such reports* On several occasions I have expressed the appreciation of the Treasury for the cooperation which banks and other financial institutions have extended in making confidential reports of large and unusual cur rency transactions* I want to express my appreciation again for this public service and to urge continued cooperation and renewed vigilance in this regard* At the same time I wish also to express my appreciation for the assistance you have rendered in other areas dealing with Treasury activities, particularly those relating to the handling of withheld income and social security taxes, in providing banking services and facilities for the defense and other activities of the Government, and in the sale and redemption of United States Savings Bonds* RELEASE MORNING NEW5PAHSRS, Friday, February 29, 1952 S-297® Secretary Snyder announced today the issuance of an amended regulation relating to reports of transactions in United States currency. The regula tion requires every bank and other financial institution in the United States to file monthly reports of large and unusual currency transactions which exceed those commensurate with the customary conduct of the business* industry or profession of the person or organization concerned* The report system was inaugurated in 19hS after it had been established that racketeers and others engaged in illegal activities were resorting on a large scale to the use of large denomination currency as an attempted method of concealing income* The amended regulation will make the reporting procedure less burdensome to banks and other institutions while providing the Bureau of Internal Revenue with a continuing flow of those reports which experience has shown to be the moat helpful in detecting major tax evaders* The change in the regulation was decided upon by the Treasury after consultation with the Federal Reserve System and a committee representing the American Bankers Association* The requirement for reports involving transactions of #1,000 or more, in denominations of $50 or higher, has been changed to $2,500 involving denominations of $100 or higher. Reports of all transactions of $10,000 or more in any denominations also are required* The regulation does not apply to currency transactions which, in the judgment of the reporting institution, are normal ones in the regular and customary conduct of the business, industry or profession of the persons or organizations involved* The reports are treated by the Bureau of Internal Revenue as confi dential communications, and there is no disclosure of the source of information received through them* Large amounts of evaded income tax have been recovered by the Bureau of Internal Revenue through leads obtained from the reports* In making today's announcement, Secretary Snyder referred to the assistance given the Bureau of Internal Revenue by baaks and other financial institutions, through the currency transaction reports, as an outstanding public service* oOo Title 31 “ Money and Finance: Treasury Chapter I - Monetary Offices, Department of the Treasury Part 102 Treasury Department OFFICE OF THE SECRETARY February 21, 1952 AMENDED INSTRUCTIONS RELATING TO REPORTS (P CURRENCY TRANSACTION^* Pursuant to Section 5(b) of the Act of October 6, 1917 (UO Stat. Ul5), as amended, and other authority vested in me by law, the following instructions are prescribed: Section 102.1. Reports of currency transactions required. Commencing with trans actions occurring in the month of Marcn, 1952, every financial institution in the United States shall file monthly reports on Form TCR-1 concerning each deposit or withdrawal, or other payment or transfer, effected by, through, or to such financial institution, which involves transactions in United States currency as follows: 1. 2. 3. Transactions involving $2,500 or more of United States currency in denominations of $100 or higher; Transactions involving $10,000 or more of United States currency in any denominations, and Transactions involving any amount in any denominations, which in the judgment of the financial institution exceed those commensurate with the customary conduct of the business, industry or profession of the person or organiza tion concerned. Section 102.2. Filing of reports. Reports on Form TCR-1 shall be filed in duplicate on or before the 15th day of the month following that in which the reported transactions occur, with the Federal Reserve Bank of the district in which the report ing financial institution is located. A n information called for in such form shall be furnished.* Section 102.3. Identification required. No financial institution shall effect any transaction with respect to which a report is required unless the person or organizations with idiom such transaction is to be effected has been satisfactorily identified.* Section 102.U. Definitions. As used herein "payment or transfer" shall include exchange of currency; and "financial institutions" shall mean banks, trust companies, savings banks, private bankers, investment bankers, building and loan associations, securities and commodities brokers, and currency exchanges and other persons or * 5 c I n " f g l o T l . ' ' ; . 251; fee. 5(b), U S a . U 'aaTftSj S c 2 --e£6s lf.T fgU~gg O t t 15 e. , U8 Stat. 1; 5h Stat. 179; 55 Stat. 839; Ex. Order 6073, Mar. 10, 1933, as amended by Proc. 2070, Dec. 30, 1933 and Ex. Order 6599, Jan. 15, 193hi Ex. Order 8389, Apr. 10, 19U0, as amended; Ex. Order 9193, 'July 6, 19U2.