Opinion ID: 499793
Heading Depth: 2
Heading Rank: 1

Heading: Failure to File a CTR; 31 U.S.C. Sec. 1058

Text: 10 The government's theory under Count III of the indictment is that the $120,000.00 loan from Marchant to Shannon and the deposit of these funds into the Farmers and Merchants correspondent account were two parts of a scheme to conceal the existence of these funds from the IRS. This was done, argues the government, by the circumvention of currency transaction reporting requirements. 11 Shannon's liability under Count III is premised on the Bank Secrecy Act of 1971, and its implementing regulations, which require financial institutions to file a CTR for any currency transaction exceeding $10,000.00. 31 U.S.C. Secs. 1058, 1081 (1976). 3 Shannon asserts that he was under no duty to file a CTR under the circumstances alleged in the indictment, and that his conviction pursuant to section 1058 cannot, therefore, be upheld. We find Shannon's argument to be without merit. 12 The testimony adduced at trial reveals that Shannon was aware of the CTR reporting requirements, knew that the money loaned to him by Marchant was personal in nature rather than funds of the Bank, knew that the funds had been deposited into the Farmers and Merchants correspondent account, yet failed to cause either Farmers and Merchants or Mercantile to file the proper documentation with the IRS. As chairman of the board of Farmers and Merchants and as the individual responsible for the Bank's day-to-day operations, Shannon was aware of the impropriety of depositing personal funds into a Farmers and Merchant's correspondent account if the transaction results in evasion of CTR requirements. Thus, under the evidence adduced, a jury finding that Shannon knew of the improper deposit and knew that he should have caused a CTR to be filed was appropriate. In light of Shannon's position of control at Farmers and Merchants, to decide otherwise would thwart the purpose of the reporting statutes. See United States v. Massa, 740 F.2d 629, 645 (8th Cir.1984), cert. denied, 471 U.S. 1115, 105 S.Ct. 2357, 86 L.Ed.2d 258 (1985). 13 The defendant's reliance on United States v. Larson, 796 F.2d 244 (8th Cir.1986), is misplaced. There, this court reversed the defendant's conviction under the currency transaction reporting laws, holding that the defendant was without fair warning that his conduct was illegal. The defendant in Larson, however, unlike Shannon, structured his transactions so that each individual deposit amounted to slightly less than $10,000.00. Such a circumstance was crucial to the court's decision in Larson. Thus, Larson has no impact upon our decision here.