I 
110TH CONGRESS 
1ST SESSION H. R. 1447 
To amend sections 5313 and 5318 of title 31, United States Code, to 
reform certain requirements for reporting cash transactions, and for 
other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
MARCH 9, 2007 
Mr. JONES of North Carolina introduced the following bill; which was referred 
to the Committee on Financial Services 
A BILL 
To amend sections 5313 and 5318 of title 31, United States 
Code, to reform certain requirements for reporting cash 
transactions, and for other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘CTR Modernization 
Act’’. 
SEC. 2. PURPOSES. 
The purposes of this Act are as follows: 
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(1) To improve the quality and usefulness of 
currency transaction reports in criminal, tax, and 
regulatory investigations or proceedings. 
(2) To eliminate filing currency transaction re-
ports related to many innocent, infrequent, or idio-
syncratic deposit activities. 
(3) To further focus anti-money laundering in-
vestigations and prosecutions by reducing the num-
ber of spurious, duplicative, and innocent currency 
transaction reports and increasing the usefulness of 
suspicious activity reports. 
(4) To maintain the high degree of usefulness 
of currency transaction reports and adjust for infla-
tion and current financial practices the threshold for 
currency transaction reports to a level consistent 
with the amount established pursuant to Public Law 
91–508 upon the enactment of such Public Law in 
1970. 
(5) To increase the usefulness of data collected 
through currency transaction reports and suspicious 
activity reports and for other purposes. 
SEC. 3. MODIFICATION OF CURRENCY TRANSACTION RE-
PORTING THRESHOLD. 
(a) THRESHOLD.— 
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(1) NONDEPOSITORY INSTITUTIONS.—The 1st 
sentence of section 5313(a) of title 31, United 
States Code, is amended by inserting ‘‘, other than 
a depository institution,’’ after ‘‘domestic financial 
institution’’. 
(2) DEPOSITORY
INSTITUTIONS.—Subsection 
(a) of section 5313 of title 31, United States Code, 
is amended by inserting after the 1st sentence (as 
amended by paragraph (1) of this subsection) the 
following new sentence: ‘‘When a depository institu-
tion is involved in a transaction for the payment, re-
ceipt, or transfer of United States coins or currency 
(or other monetary instruments the Secretary of the 
Treasury prescribes), in an amount, denomination, 
or amount and denomination of not less than 
$30,000 and under circumstances the Secretary pre-
scribes by regulation, the depository institution and 
any other participant in the transaction the Sec-
retary may prescribe shall file a report on the trans-
action at the time and in the way the Secretary pre-
scribes.’’. 
(b) REGULATION.—After the end of the 270-day pe-
riod beginning on the date of the enactment of the CTR 
Modernization Act, the Secretary of the Treasury shall not 
require a depository institution to file a currency trans-
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action report when the transaction involves the transfer 
of currency of an amount and denomination of less than 
$30,000. 
(c) TECHNICAL AND CONFORMING AMENDMENT.— 
Subsection (c) of section 5312 of title 31, United States 
Code, is amended by adding at the end the following new 
paragraph: 
‘‘(2) DEPOSITORY INSTITUTION.—The term ‘de-
pository institution’ means any insured depository 
institution (as defined in section 3 of the Federal 
Deposit Insurance Act) and any insured credit union 
(as defined in section 101(7) of the Federal Credit 
Union Act).’’. 
SEC. 4. PERIODIC REVIEW OF REPORTING THRESHOLD 
AND ADJUSTMENT FOR INFLATION. 
Section 5318 of title 31, United States Code, is 
amended by adding at the end the following new sub-
section: 
‘‘(o) PERIODIC REVIEW OF REPORTING THRESHOLD 
AND ADJUSTMENT FOR INFLATION.— 
‘‘(1) IN GENERAL.—Before the end of the 5- 
year period beginning on the date of the enactment 
of the CTR Modernization Act and at least every 5 
years after the expiration of such period, the Sec-
retary of the Treasury shall— 
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‘‘(A) solicit and review public comments 
about the appropriateness, relevance, and utility 
of the then-current threshold amount or de-
nomination established by the Secretary; 
‘‘(B) review the continuing appropriate-
ness, relevance, and utility of each threshold 
amount or denomination established by the Sec-
retary, in the Secretary’s discretion, for any re-
port required by the Secretary under this sub-
chapter; and 
‘‘(C) adjust such amount, at such time and 
in such manner as the Secretary considers ap-
propriate but in no case later than 365 days 
following the expiration of the public comment 
period, for any inflation that the Secretary of 
the Treasury determines has occurred since the 
date any such amount was established or last 
adjusted, except that the Secretary of the 
Treasury shall not reduce such amount to an 
amount and denomination of less than $30,000. 
‘‘(2) REPORT.—Before the end of the 365-day 
period beginning upon the completion of any review 
by the Secretary of the Treasury under paragraph 
(1), the Secretary shall submit a report to the Con-
gress containing the findings and conclusions of the 
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Secretary in connection with such review, together 
with an explanation for any adjustment, or lack of 
adjustment, of any threshold amount or denomina-
tion by the Secretary as a result of such review, in-
cluding the adjustment for inflation.’’. 
SEC. 5. MODIFICATION OF EXEMPTION PROCESS. 
(a) SEASONED CUSTOMER EXEMPTION.—Subsection 
(e) of section 5313 of title 31, United States Code, is 
amended to read as follows: 
‘‘(e) QUALIFIED CUSTOMER EXEMPTION.— 
‘‘(1) IN GENERAL.—Before the end of the 270- 
day period beginning on the date of the enactment 
of the CTR Modernization Act, the Secretary of the 
Treasury shall prescribe regulations that exempt any 
depository institution from filing a report pursuant 
to this section in a transaction for the payment, re-
ceipt, or transfer of United States coins or currency 
(or other monetary instruments the Secretary of the 
Treasury prescribes) with a qualified customer of 
the depository institution. 
‘‘(2) QUALIFIED
CUSTOMER
DEFINED.—For 
purposes of this section, the term ‘qualified cus-
tomer’, with respect to a depository institution, has 
such meaning as the Secretary of the Treasury shall 
prescribe, which shall include any person that— 
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‘‘(A) is incorporated or organized under 
the laws of the United States or any State, in-
cluding a sole proprietorship (as defined in 31 
Code of Federal Regulations 103.22(d)(6)(vii), 
as in effect on May 10, 2006), or is registered 
as and eligible to do business within the United 
States or a State; 
‘‘(B) has maintained a deposit account 
with the depository institution for at least 12 
months; and 
‘‘(C) has engaged, using such account, in 
multiple currency transactions that are subject 
to the reporting requirements of subsection (a). 
‘‘(3) REGULATIONS.— 
‘‘(A) IN GENERAL.—The Secretary of the 
Treasury shall prescribe regulations requiring a 
depository institution to file a 1-time notice of 
designation of exemption for each qualified cus-
tomer of the depository institution. 
‘‘(B) FORM AND CONTENT OF EXEMPTION 
NOTICE.—The Secretary shall by regulation 
prescribe the form, manner, content, and timing 
of the qualified customer exemption notice and 
such notice shall include information sufficient 
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to identify the qualified customer and the ac-
counts of the customer. 
‘‘(C) AUTHORITY OF SECRETARY.— 
‘‘(i) IN
GENERAL.—The Secretary 
may suspend, reject, or revoke any quali-
fied customer exemption notice, in accord-
ance with criteria prescribed by the Sec-
retary by regulation. 
‘‘(ii) 
CONDITIONS.—The 
Secretary 
may establish conditions, in accordance 
with criteria prescribed by regulation, 
under which exempt qualified customers of 
an insured depository institution that is 
merged with or acquired by another in-
sured depository institution will continue 
to be treated as designated exempt quali-
fied customers of the surviving or acquir-
ing institution.’’. 
(b) 3-YEAR REVIEW AND REPORT.—Before the end 
of the 3-year period beginning on the date of the enact-
ment of this Act, the Secretary of the Treasury, in con-
sultation with the Attorney General, the Secretary of 
Homeland Security, the Federal banking agencies, the 
banking industry, and such other persons as the Secretary 
deems appropriate, shall evaluate the operations and effect 
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of the provisions of the amendment made by subsection 
(a) and make recommendations to the Congress as to any 
legislative action with respect to such provision as the Sec-
retary may determine to be appropriate. 
SEC. 6. IDENTIFYING SUSPICIOUS ACTIVITY. 
Subsection 5318(g) of title 31, United States Code, 
is amended by adding at the end the following new para-
graph: 
‘‘(5) GUIDANCE
ON
WHEN
TO
FILE
A
RE-
PORT.—Before the end of the 270-day period begin-
ning on the date of the enactment of the CTR Mod-
ernization Act, the Secretary of the Treasury shall 
prescribe regulations that provide guidance on exam-
ples of transactions that— 
‘‘(A) involved funds derived from illegal ac-
tivities; 
‘‘(B) were designed to evade any require-
ments under this subchapter, chapter 2 of title 
I of Public Law 91–508, or the Internal Rev-
enue Code of 1986; and 
‘‘(C) have no business or apparent lawful 
purpose.’’. 
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SEC. 7. PROVIDING GENERAL INFORMATION REGARDING 
SUSPICIOUS 
ACTIVITY 
REPORT 
REQUIRE-
MENTS. 
Subsection 5318(g) of title 31, United States Code, 
is amended by inserting after paragraph (5) (as added by 
section 6 of this Act) the following new paragraph: 
‘‘(6) 
GENERAL
NOTIFICATION
TO
CUS-
TOMERS.— 
‘‘(A) IN GENERAL.—Before the end of the 
270-day period beginning on the date of the en-
actment of the CTR Modernization Act, the 
Secretary of the Treasury shall prescribe regu-
lations that create a list of information that 
may be disclosed to customers prior to the re-
porting of suspicious activity. 
‘‘(B) RULE OF CONSTRUCTION.—Subpara-
graph (A) of this paragraph shall not be con-
strued as creating any immunity from the noti-
fication prohibition under paragraph (2).’’. 
Æ 
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