Free Memorandum - District Court of Arizona - Arizona

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PAUL K. CHARLTON United States Attorney District of Arizona ALBERT L. KLEINER Assistant United States Attorney Evo A. Deconcini U.S. Courthouse 405 W. Congress, Suite 4800 Tucson, Arizona 85701-5040 Telephone: (520) 620-7300 [email protected] Attorneys for Plaintiff

UNITED STATES DISTRICT COURT DISTRICT OF ARIZONA United States of America CR-04-00718-PHX-DKD Plaintiff, v. BRADLEY SCHROEDER, Defendant. MEMORANDUM OF LAW REGARDING CURRENCY TRANSACTION REPORTS

COMES NOW the plaintiff, United States of America, by and through Paul K. Charlton, United States Attorney for the District of Arizona, and Albert L. Kleiner, Assistant United States Attorney, and hereby files this Memorandum of Law Regarding Currency Transaction Reports for the Court's reference at the sentencing hearing set for February 27, 2006 at 1:00 p.m. Background At the first portion of the sentencing hearing held in this matter on February 9, 2006,the Court inquired of Plaintiff's witness, Internal Revenue Service Agent Kathleen Cornelius, as to whether the Defendant's bank would have been required to notify the Internal Revenue Service of the $107,000 in deposits. Ms. Cornelius stated that the bank would not have been required to notify the Internal Revenue Service as the deposits were not in cash or currency. The Court questioned the accuracy of Ms. Cornelius' understanding of the law in this area. To clarify any potential issue or misunderstanding regarding this matter, the United States files this Memorandum of Law Regarding Currency Transaction Reports.

Case 2:04-cr-00718-DKD

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Filed 02/17/2006

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Law Federal law requires banks to file a currency transaction report ("CTR") with the Secretary of the Treasury for any cash transaction over $10,000. 31 U.S.C. § 5313(a); 31 C.F.R. § 103.22(b)(1). Section 5313(a) provides: When a domestic financial institution is involved in a transaction . . . of United States coins or currency . . . in an amount [and/or] denomination . . . the Secretary [of the Treasury] prescribes by regulation, the institution . . . shall file a report on the transaction at the time and in the way the Secretary prescribes. (Emphasis added.) The implementing regulation, 31 C.F.R. § 103.22(b)(1), provides in relevant part that: Each financial institution . . . shall file a report of each deposit, withdrawal, exchange of currency or other payment or transfer, by, through, or to such financial institution which involves a transaction in currency of more than $10,000[.] (Emphasis added.) Thus, financial institutions are only required to file CTRs when the transaction involves coin or currency, not other forms of negotiable instruments. Since the $107,000 in deposits the Court questioned the witness about was not in coin or currency, no CTR would have been required to be filed by the bank and the Internal Revenue Service would not have been notified of the transaction. //

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Respectfully submitted this 17th day of February, 2006. PAUL K. CHARLTON United States Attorney District of Arizona /s/ Albert L. Kleiner Albert L. Kleiner Assistant United States Attorney
Copy of the foregoing served electronically or by other means this 17th day of February, 2006, to:

Michael Kimerer, Esq. Kimerer & Derrick 221 East Indianola Ave. Phoenix, Arizona 85012

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Case 2:04-cr-00718-DKD

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Filed 02/17/2006

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