← Broker database 2023-06-23
James Anthony Iannazzo Charged with Structuring Cash Transactions to Avoid Reporting
According to FINRA, James Anthony Iannazzo was named as a respondent in a FINRA complaint alleging that he repeatedly structured cash deposits and withdrawals to cause financial institutions to fail to file Currency Transaction Reports (CTRs).
The complaint alleges that Iannazzo divided cash transactions over $10,000 into smaller deposits or withdrawals conducted over several days at the same bank, and often conducted transactions at different branches of the same bank. He also frequently withdrew more than $10,000 in cash on a single day through transactions conducted at two different financial institutions.
In total, the complaint alleges Iannazzo structured 71 cash deposits and withdrawals totaling $568,440 in two personal bank accounts and 297 ATM deposits and withdrawals totaling $277,450 in an account at his member firm. The alleged structuring was designed to avoid conducting a single deposit or withdrawal over $10,000 at a financial institution, which would require the institution to file a CTR.
Structuring, also known as "smurfing," is a federal crime under the Bank Secrecy Act. CTRs are required for cash transactions over $10,000 to help law enforcement detect money laundering, tax evasion, and other criminal activity. By deliberately breaking up transactions to avoid the $10,000 reporting threshold, individuals attempt to evade this detection.
The complaint alleges that Iannazzo engaged in this conduct despite receiving training on money laundering and structuring from his firm and receiving pamphlets describing CTRs and structuring from one of the banks. This suggests he was aware of the reporting requirements and deliberately structured transactions to avoid them.
It is important to note that this is a complaint with allegations that have not been proven. Iannazzo has the opportunity to respond to the allegations and contest them in a hearing. However, the allegations are serious—structuring is a federal crime that can result in criminal prosecution in addition to securities industry sanctions.
For investors, this case illustrates that financial professionals are subject to anti-money laundering laws and are trained to recognize and avoid structuring. Investors should be aware that legitimate cash transactions over $10,000 are routinely reported and there is no impropriety in such reporting for lawful transactions.