Banks become suspicious of cash deposits

Money laundering? Too much cash makes you suspicious!

Fallacy: unusual amounts = tax evasion = reporting obligation

Lawyer Ingo Minoggio annoys the banks' actions for several reasons. Even the assumption is absurd that every cash payer wants to evade taxes. But from a purely legal point of view, he is concerned with a different point: banks are only required to report if the money could come from certain criminal offenses. This includes tax evasion. But "at the time of payment, the payer has not yet evaded the taxes, that only happens with the tax return."

For this reason alone, banks would "certainly not have to report such money movements," emphasizes Minoggio. "And if they do not have to be reported, then the banks are not allowed to report them either, because they have a contractual obligation of confidentiality and a duty of loyalty to the customer."

But the practice looks different. Bank customers are subject to a flat rate of money laundering and tax evasion. “Banks deliver their customers to the knife with money laundering reports for no reason,” says Minoggio. And that will in any case lead to inquiries from the tax office.

What are the consequences of a complaint for money laundering?

In the rarest of cases, criminal proceedings for money laundering are opened after a money laundering report, reports Minoggio. "Almost all investigations are stopped immediately due to a lack of suspicion."

Bank customers are not off the hook. Instead, the process ends up with the tax authorities. There is a threat:

  • Inquiries about the origin of the money
  • Tax audit
  • Criminal tax proceedings
  • Searches

“Such criminal tax proceedings can cause serious damage, even if all tax obligations are completely correctly fulfilled,” the lawyer knows. "In our experience, it almost never happens that a tax office does nothing after such a report."

What amounts are suspicious?

Actually, the critical limit for cash deposits is 10,000 euros. But even with smaller amounts, companies can come under suspicion of money laundering: Even in the case of unexplained multiple payments of four-digit amounts, there is a reporting obligation, says lawyer Ingo Minoggio. Even with three-digit amounts, a report cannot be completely ruled out "if someone suddenly pays 900 euros in cash every two days over a long period of time".

And what is the situation when it comes to companies with a high share of cash income? For example bakers, butchers or hairdressers? According to the expert, you are only at risk if a cash payment deviates significantly from the average values ​​otherwise customary for the company.

How can bank customers protect themselves from suspected money laundering?

In order to avoid being reported for money laundering, Minoggio advises contacting the house bank:

  • Inform about incoming payments: “For every account there is an account manager, a clerk. And he has to know when and to what extent payments are usually received. ”If there are also unusual deposits or withdrawals, bank customers should inform the account manager beforehand.
  • Ask for questions: "Bank customers should make it clear to the account manager that they expect further inquiries if the bank still needs clarification on a transaction."
  • Threaten with consequences: Bank customers should also make the consequences of an unfounded money laundering report clear: "You really have to threaten to end the customer relationship immediately and tell your friends about the incident."
  • Do not get rid of: In Minoggio's experience, bank customer advisors try to shirk their responsibility. The compliance department decides on money laundering reports, the account manager has nothing to do with it. Minoggio: “That's not true. The contact to the customer is always involved. "

What should I do after a complaint for money laundering?

If a bank customer learns of a money laundering report, he should inform his tax advisor as a precaution. Because the tax office will at least have inquiries. If the tax office indicates a possible criminal tax procedure, tax advisors now advise to consult a specialist lawyer for criminal law.

What about the bank? If the report was unjustified, claims against the house bank are theoretically possible because of the resulting costs, says Minoggio. “I just don't think the banks are getting involved. Maybe an agreement can be negotiated if the customer is important to the bank. But it will be difficult to take legal action. "

It is all the more important that the credit institutions and their associations become active themselves. The expert sees a considerable need for further training there on what needs to be reported when: “Of course, no customer can ask his house bank to leave obligations under the Money Laundering Act pending. But one can very well demand that the reporting obligations are not met as a precautionary measure to the detriment of the customer if, on closer inspection, they should have been negated according to law and statute. "

Background: Why cash deposits are not tax evasion and are still reported

In fact, credit institutions are required to report money laundering if they suspect that the money could have come from a crime. New - and thus the trigger for the increased suspicion reports: Since 2015, so-called own money laundering has also been a criminal offense.

It is considered to be own money laundering if a perpetrator brings property acquired through his criminal act into circulation himself. For example, when a criminal pays income from robbery, human trafficking or drug deals into his bank account.

However, tax evasion is also a criminal offense that falls under anti-money laundering regulations. And if a tax evader brings money into circulation from tax evasion, it is self-laundering. What the banks have to report in the event of suspicion.

What sounds complicated, but logical, has only one catch: the logic is wrong. Even if the paid-in money comes from undeclared work, for example. Revenues from undeclared work are not subject to money laundering regulations.

So there is only the suspicion that it is income that should not be taxed. Perhaps the payer has this intention. However, intent is not yet a criminal offense. It only becomes a tax offense once he has submitted his tax return.

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