Family member returning borrowed money?

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unstoppable
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Family member returning borrowed money?

Post by unstoppable » Wed May 13, 2020 8:36 pm

My sister (same last name as me) is repaying borrowed money + adding extra for my gratitude. I obviously didn’t ask for any extra but she insists.

Anyway, we have the same bank (Bank of america), and I’m curious on best payment methods.

The anount is over $10K, so I believe it will trigger the reporting flags.

Originally I thought the best option was a check and she can write “loan repayment” in the memo section, but I’m not sure anyone cares about the memo section.

She mentioned she can simply do an online transfer. I thought it was limited to $2,500 daily or something similar, but she says with a PIN she can do full amount.

Any recommendations? Not looking to hide anything just don’t want to cause any unnecessary red flags?

What’s the best option? Online transfer? Wire? ACH? Check?

Thanks!

Grt2bOutdoors
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Re: Family member returning borrowed money?

Post by Grt2bOutdoors » Wed May 13, 2020 8:43 pm

unstoppable wrote:
Wed May 13, 2020 8:36 pm
My sister (same last name as me) is repaying borrowed money + adding extra for my gratitude. I obviously didn’t ask for any extra but she insists.

Anyway, we have the same bank (Bank of america), and I’m curious on best payment methods.

The anount is over $10K, so I believe it will trigger the reporting flags.

Originally I thought the best option was a check and she can write “loan repayment” in the memo section, but I’m not sure anyone cares about the memo section.

She mentioned she can simply do an online transfer. I thought it was limited to $2,500 daily or something similar, but she says with a PIN she can do full amount.

Any recommendations? Not looking to hide anything just don’t want to cause any unnecessary red flags?

What’s the best option? Online transfer? Wire? ACH? Check?

Thanks!
There is nothing wrong with a check, I'm not sure if an online transfer between two unrelated account holders (unrelated as in - you have your own account, she has her own account and you/her are not joint account holders) is permissible. Why do a wire? All that will do is let BofA earn fees that the sender and recipient will both have to pay, plus generate paperwork for the sender. Have her write you a check, deposit it and be done with it. Banks accept check deposits on a daily basis, with no issue. Are you normally concerned when banking? You should not be.
Last edited by Grt2bOutdoors on Wed May 13, 2020 8:44 pm, edited 1 time in total.
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dukeblue219
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Re: Family member returning borrowed money?

Post by dukeblue219 » Wed May 13, 2020 8:43 pm

Nothing will come of it. People transfer more than that ALL THE TIME with no issues - consider parents making large gifts at end of year to kids, people buying used cars, self employed people drawing a salary, and on and on. Just make the transfer or write a check and don't even draw any attention to it in the memo line. You won't be put on a money laundering watch list.
Last edited by dukeblue219 on Wed May 13, 2020 8:46 pm, edited 2 times in total.

Grt2bOutdoors
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Re: Family member returning borrowed money?

Post by Grt2bOutdoors » Wed May 13, 2020 8:45 pm

dukeblue219 wrote:
Wed May 13, 2020 8:43 pm
Nothing will come of it. People transfer more than that ALL THE TIME with no issues - consider parents making large gifts at end of year to kids, people buying used cars, self employed people drawing a salary, and on and on. Just make the transfer or write a check and don't even draw any attention to it. You won't be put on a money laundering watch list.
He could be if there was suspected "structuring" in the account. This is most likely not the case.
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Steelersfan
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Re: Family member returning borrowed money?

Post by Steelersfan » Wed May 13, 2020 8:50 pm

From what I know, the money laundering list involves cash transactions, i.e. the green stuff. You're not dealing with cash so no issue.

student
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Re: Family member returning borrowed money?

Post by student » Wed May 13, 2020 8:54 pm

Steelersfan wrote:
Wed May 13, 2020 8:50 pm
From what I know, the money laundering list involves cash transactions, i.e. the green stuff. You're not dealing with cash so no issue.
This is my understanding as well. The government only wants to know where the money is coming from and there is no issue in OP's case.

Grt2bOutdoors
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Re: Family member returning borrowed money?

Post by Grt2bOutdoors » Wed May 13, 2020 8:55 pm

Steelersfan wrote:
Wed May 13, 2020 8:50 pm
From what I know, the money laundering list involves cash transactions, i.e. the green stuff. You're not dealing with cash so no issue.
Actually, it involves more than just "cash" - the USA Patriot Act of 2001 talks about the key points.
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whodidntante
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Re: Family member returning borrowed money?

Post by whodidntante » Wed May 13, 2020 8:56 pm

You may be overthinking this.

cogito
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Re: Family member returning borrowed money?

Post by cogito » Wed May 13, 2020 8:57 pm

You are more likely to trigger structuring flags by transferring multiple small amounts successively. Do not do it that way. One and done.

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camillus
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Re: Family member returning borrowed money?

Post by camillus » Wed May 13, 2020 9:07 pm

I also suggest keeping the memo line blank.

Gnirk
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Re: Family member returning borrowed money?

Post by Gnirk » Wed May 13, 2020 9:19 pm

My DH gifts his adult kids $15, 000 per year by check. No problems have come up.

Topic Author
unstoppable
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Re: Family member returning borrowed money?

Post by unstoppable » Wed May 13, 2020 10:15 pm

Gnirk wrote:
Wed May 13, 2020 9:19 pm
My DH gifts his adult kids $15, 000 per year by check. No problems have come up.
DH? How old are the kids? How many? Just curious and jealous 😊

Katietsu
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Re: Family member returning borrowed money?

Post by Katietsu » Wed May 13, 2020 10:27 pm

Since she seems comfortable with the online transfer, that would be my choice. Why make it more complicated than it needs to be?

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Cubicle
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Re: Family member returning borrowed money?

Post by Cubicle » Wed May 13, 2020 11:04 pm

The red flag would be trying to disguise the repayment. Small spaced out payments typically.

I'd recommend the check, all in 1 lump sum. If there are questions, there is only 1 transaction on 1 date to be investigated.

And the probability this raises any flags approaches zero the longer you think about this! I'd not worry at all.
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Kookaburra
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Re: Family member returning borrowed money?

Post by Kookaburra » Wed May 13, 2020 11:23 pm

If you were Wally cutting a 10K check to the Beaver in 1960 Mayfield, then maybe you could worry. But in 2020, that’s small potatoes.

Gnirk
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Re: Family member returning borrowed money?

Post by Gnirk » Thu May 14, 2020 1:54 am

unstoppable wrote:
Wed May 13, 2020 10:15 pm
Gnirk wrote:
Wed May 13, 2020 9:19 pm
My DH gifts his adult kids $15, 000 per year by check. No problems have come up.
DH? How old are the kids? How many? Just curious and jealous 😊
Dear Husband is 81 and I encouraged him to gift his son and daughter money now ( they are mid-late 50’s) when they can use a little extra, rather than inheriting all of it later. It’s more fun to give while we’re alive, in my opinion. BTW, he worked 6 days a week, 10 hours a day for most of his life. He was very frugal, and saved as much as possible. Which is why he’s able to be generous with them now.

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HueyLD
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Re: Family member returning borrowed money?

Post by HueyLD » Thu May 14, 2020 6:43 am

unstoppable wrote:
Wed May 13, 2020 8:36 pm
My sister (same last name as me) is repaying borrowed money + adding extra for my gratitude. I obviously didn’t ask for any extra but she insists.

Anyway, we have the same bank (Bank of america), and I’m curious on best payment methods.
...
What’s the best option? Online transfer? Wire? ACH? Check?
If you both have BofA accounts, use internal transfers as follows:

Your sister goes to “Add Bank of America Recipient” and adds your account to the list of accounts she wants to be able to transfer to. Once you are on her list, she just puts in the account the money is coming from and the amount.

The money never leaves the BofA. No checks, no ACH or wire transfers needed.

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StevieG72
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Re: Family member returning borrowed money?

Post by StevieG72 » Thu May 14, 2020 6:47 am

It's not a big deal. The money laundering trigger is a CASH deposit over $10,000. A check for that amount or larger will not raise any eyebrows.
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The Broz
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Re: Family member returning borrowed money?

Post by The Broz » Thu May 14, 2020 7:10 am

Just do it like you normally would if there were no magic $10k barrier - all at once and be done with it. That sort of thing happens all the time. Making several smaller payments is much more of a red flag, i.e. "why are they making all these payments in quick succession?"

retiringwhen
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Re: Family member returning borrowed money?

Post by retiringwhen » Thu May 14, 2020 7:17 am

StevieG72 wrote:
Thu May 14, 2020 6:47 am
It's not a big deal. The money laundering trigger is a CASH deposit over $10,000. A check for that amount or larger will not raise any eyebrows.
I was flagged by an institution (and reported, but nothing came of it) for a bank account transfer of less than $10,000 that did not involve cash on my end. The reason, I was regularly sending medium size money (more than $1,000, less then $3,000) to a family member for legitimate reasons that did not involve structuring, but from a casual perspective may have appeared that it was structuring. I got spooked, and stopped that process completely and began to handle the process in a different way (I began to pay expenses directly).

BTW, the only reason I know I was reported is because the customer service rep sort of talked out of turn and told me I was flagged. I don't think they are supposed to do that, the reporting is normally done without knowledge to the individual under suspicion.

There are numerous federal legal cases where people have had legitimate money (small businesses mostly) seized by the Federal Government for money laundering. It is a Civil offense and the Federal Government does not have to show evidence or proof of illegal activity only a reportable activity. It is incumbent upon the defendant to prove the money is legitimate. Many people are surprised to find that such legal frameworks exist, but they do and are well documented and used regularly by the Federal (plus state and local governments)

There are very strict legal requirements for financial institutions to report activity, repeated transactions is one of the triggers.

The key is don't appear to be structuring payments in any way for any amount. Just do what you need to do and do it in the smallest number of transactions feasible.

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Re: Family member returning borrowed money?

Post by AlohaJoe » Thu May 14, 2020 7:18 am

unstoppable wrote:
Wed May 13, 2020 8:36 pm
The anount is over $10K, so I believe it will trigger the reporting flags.
Why do you care if it does?

Do you think the police are going to kick down your door if you trigger a reporting flag at your bank?

Just transfer the full amount in a single transaction online.

scophreak
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Re: Family member returning borrowed money?

Post by scophreak » Thu May 14, 2020 8:59 am

StevieG72 wrote:
Thu May 14, 2020 6:47 am
It's not a big deal. The money laundering trigger is a CASH deposit over $10,000. A check for that amount or larger will not raise any eyebrows.
I'm certainly not an expert on this, but from my understanding (and from what I've read) a $10,000+ check should trigger a CTR by the bank. Not really something to worry about given the nature of this transaction, but checks are absolutely covered and not only cash.

Topic Author
unstoppable
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Re: Family member returning borrowed money?

Post by unstoppable » Thu May 14, 2020 10:22 am

Thanks everyone, I'll simply have her do an online transfer and move on. I always overthink everything as usual, definitely an annoying trait.

I believe their might be a $2,500 daily limit, but I guess we will see.

dziuniek
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Re: Family member returning borrowed money?

Post by dziuniek » Thu May 14, 2020 10:37 am

If you're worried, have her make 2 transfers.

dukeblue219
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Re: Family member returning borrowed money?

Post by dukeblue219 » Thu May 14, 2020 10:40 am

dziuniek wrote:
Thu May 14, 2020 10:37 am
If you're worried, have her make 2 transfers.
This is exactly what everyone on the thread said not to do. Don't split it up into a bunch of small transactions.

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8foot7
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Re: Family member returning borrowed money?

Post by 8foot7 » Thu May 14, 2020 11:07 am

There is no issue with doing this as an electronic transaction or with a check. This is because there is a trail of where the money came from, which is what the flags on cash are trying to establish.

Further, there is no such thing as structuring with electronic transactions. You can make as many transfers as you wish because there is no reporting requirement to be avoided because it's all electronic so the trail of origin can be established. You cannot evade a reporting requirement that does not exist.

If a bank has flagged electronic activity, they are misapplying federal law, or they have decided your activity while not in cash does not meet their risk appetite. Auditors may suggest flagging this type of account activity that, while not in violation of a law, may suggest something untoward. This would almost certainly be if this sort of transfer were repeated many times, not a single transfer between related parties. You read about this kind of thing with people depositing money orders they've purchased with rewards cards -- not illegal, not in violation of anything, but suggestive of the potential type of activity a bank may not want to associate themselves with.

The flag would happen if your sister deposited 10k or more in cash (paper currency, the kind with cocaine and coronavirus on it) into your account, or if she deposited a total of >$10k in two or more separate transactions in order to make each cash transaction less than 10k.

Just have your sister write you a check. If you both bank with BofA doing anything else (other than an online transfer which might not let you do such a large amount) is more work for no benefit at all.

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Re: Family member returning borrowed money?

Post by ralph124cf » Thu May 14, 2020 7:03 pm

unstoppable wrote:
Thu May 14, 2020 10:22 am
Thanks everyone, I'll simply have her do an online transfer and move on. I always overthink everything as usual, definitely an annoying trait.

I believe their might be a $2,500 daily limit, but I guess we will see.
If there is a $2,500 limitation, that is the bank's limitation for the senders account. Generally speaking, if the account holder asks, the bank will usually allow an increase. This may depend on the banking relationship with the account holder, and on the average daily balance in the account. If the $10,000 is a small fraction of the average daily balance, and the account holder has been a customer for a number of years, then the increase will be almost automatically approved.

Ralph

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wander
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Re: Family member returning borrowed money?

Post by wander » Thu May 14, 2020 8:50 pm

Simple, use Zelle. Transaction will go through in a few seconds.

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