Remittance transfers send money overseas electronically. You can use a bank's remittance service, for example, to make an international money transfer to a business associate in India or to family in Norway. A bank or service at the destination holds the money for the designated recipient. International transfers are a useful tool for criminals, so large transfers come under government scrutiny. Rules on remittances that took effect in 2013 give users the right to information about provider fees.
Currency Transaction Reports
Remittance transfers of $10,000 or more require the bank or remittance provider to issue a currency transaction report. The federal government set this limit to prevent money launderers or drug dealers from moving money unnoticed. The financial institution has to ask for personal identification, such as your Social Security number, name and other official documents. Structuring a large transaction as several smaller ones to avoid the limit is illegal. Potential penalties include five years in prison and $250,000 in fines. If the crime involves more than $100,000, the penalties double.
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Starting in 2013, the federal government imposed new restrictions on remittance providers handling international transfers. After you pay to send a remittance, the provider has to tell you the exchange rate and say how soon the money will be available to the recipient. The provider also lists the fees and taxes it collects and the fees collected by other parties in the transfer chain. Usually you have a half-hour after paying to change your mind and cancel the transfer.
Individual remittance providers may set their own limits on money transfers. For example, "Forbes" reported in 2013 that J.P. Morgan Chase wouldn't allow any international transfers from the bank's basic business accounts. Businesses that upgrade above basic can make transfers for a fee. Wells Fargo says it sets limits for its ExpressSend service based on several factors, including the destination. The most Express Send will remit to Mexico, for instance, is $1,500; to India, $5,000; to Vietnam, $3,000.
The government pays particular attention to some transactions that, while not prohibited, may be signs of money laundering. The Federal Financial Institutions Examination Council says, for example, that wiring money to countries known as "secrecy havens" may be a sign you're laundering or hiding money. Another red flag is when your transfer doesn't identify a recipient but just tells the bank to provide the money to someone who shows proper identification. Multiple transfers along these lines could draw added government attention.