Reporting a Suspicious Cash Transaction

Here is a situation that arises from time to time: your dealership is selling a car to a customer who wishes to pay $8,000.00 in cash. The customer has said things that have raised the suspicions of the salesperson and the sales manager about the source of the cash.Money_Laundering

Question: The customer is not giving us enough cash to make it reportable, but he has said things that make us suspicious. We think we should deliver the car and mark the ‘suspicious’ box on the IRS 8300 Form. Is that the proper thing to do?

Answer: The proper thing to do is to not deliver the car and get involved in the transaction. If you are suspicious about the source of cash and believe it may be from a criminal enterprise, then you should not do the deal. The authorities are liable to consider it as participation in a money laundering scheme even if you self report on the IRS 8300.

Question: It’s too late. The car is delivered and we are paid. We are still suspicious of the transaction. Now what do we do?

Answer: Protect the dealership by both contacting authorities and filing an IRS Form 8300. By doing so, you make the authorities aware of the deal that concerns you, and filing the IRS Form 8300 with the ‘suspicious’ box checked is also an appropriate action to notify the IRS.

Question: Since we filed the Form 8300 with the ‘suspicious’ box checked for an amount less than would have required us to file a report, do we still have to notify the customer of filing Form 8300?

Answer: No. In this case, filing the form was voluntary. The dealership is only required to provide notification to a customer of filing Form 8300 if the filing was required. In this circumstance, you are prohibited from sending notification filed a report of a suspicious transaction.