What are the two categories of exempt persons for CTRs?

The correct answer identifies the two categories of exempt persons for Currency Transaction Reports (CTRs) as Phase I and Phase II.

Phase I exempt persons include certain types of financial institutions and government entities that are not subject to CTR filing requirements because they are considered to have a lower risk of facilitating money laundering or other illicit activities. This category generally includes entities like banks, credit unions, and other regulated financial institutions, as well as certain government agencies.

Phase II exempt persons relate to specific types of businesses that operate in designated locations and meet specific criteria. This includes entities such as publicly traded companies, certain non-profit organizations, and businesses that have a significant and verifiable cash flow. These businesses are allowed to exempt their transactions from CTR reporting thanks to the federal regulations that recognize their established reputations and lower risk profile.

By understanding these categories, compliance professionals can effectively determine which clients or entities qualify for exemption from CTR requirements, helping to streamline reporting processes while maintaining adherence to BSA regulations.