The bottom line is that the BSA (the other BSA, not the scouts) directs institutions to get to know their customers. Once the institution sees you are transparent you can ghost through their systems. Heck, they might even give you business credit cards and an open line of credit to run your unusual line of business.

Why *not* pay credit card bills with MOs?
 

I just spent some time reading through this whole thread. I have a couple of questions and comments.

First, I've seen a couple of people ask why people don't just use MOs to pay off their credit card bills, but no answers to these questions. Is there concern that the credit card companies will catch wise to the fact that people are doing manufactured spend if they pay in MOs? Is it that people don't want to pay for a stamp? Is there concern that paying in MOs might trigger a FR or similar? Is it that people don't like the delay between mailing the MOs and having them applied to their account? Are people afraid to send them through the mail? Why *not* just pay off one's CC with MOs, instead of depositing them in the bank?

I have 4 Chase cards. If I purchase 2500 in gift cards on each card each month and subsequently mail 2K, 2K, 3K and 3K in MOs to pay off those cards, I've just paid a single company 10K in money orders in a month. Is the company going to file a CTR on me? Is the company going to flag me internally in some way for suspicious behavior?

[Based on the definition given by IkeEsq in this thread, doing so wouldn't be structuring, because I wouldn't be breaking up the payments to avoid reporting requirements, I would be breaking them up because each bill needed to be paid individually (though I would be curious if paying the bill for a single card in regular increments could be considered structuring: i.e. I have a bill on a single card for $12k and I pay $3k in MOs every week.)]

Try it - just expect a call from Chase Internal Compliance (which is a lot higher than their Fraud Dept) who will read you the riot act as they don't see it the same way as you (and I - formerly did). They told me to stop sending MOs immediately or else they would "sever our relationship". I got the call even though some of my MOs were $4K. Needless to say I haven't sent a MO since.

Good luck - let us know how you make out. Maybe they see things differently 4 months later?

Money Orders are considered suspicious. Use them often enough, eventually you will run into problems with someone

Now that's the kind of info I was looking for. If the CC companies are that squirrley about accepting MOs for payments, I can fully understand why people would be hesitant to pay that way. I did send a few payments last month, all of which cleared and have not caused any issues yet (crosses fingers). I wonder if I keep it to smaller amounts (i.e. 2k at a time) if I'm less likely to have problems. I guess we'll see.

Thank you for your response, it was very helpful.

I walk them into local Chase and Citi branches all the time to pay down my cards, never a second thought or remark from the tellers, and so far no calls from either bank's fraud dept.

I also have paid my bills in person with cash numerous times without problems.

Gotta love my compadres in the clergy.:p Best to just establish multiple banking relationships to move volume. Have eight institutions currently active, many with multiple accounts. As your government tells you - Diversity is a Good Thing.:D

Are all those accounts feel fine if fed with MOs only?..

Hello OP, Using MOs to payoff credit cards could fall into money laundering. If you knew someone who kept getting MOs in the thousands of dollars each month, wouldn't you ask yourself, "gee, where is the person getting all this cash? Is it be being reported? Why isn't this person writing checks instead?"

Suppose a person is sitting on a stockpile of money. Where did this person get the cash? *Usually* it's from income that hasn't been reported: tips, skimming income from cash registers, and drug sales come to mind. What this person would be doing is to make illegal money, legal.

So, to me, it's understandable why other people would be asking questions.

That's my two cents... (that's properly been reported.)

David

But I think that if that person was audited, they would still have to have income to justify all of the cc expenses they were paying off, hence it would be unlikely they would use a cc in the first place. If you want to keep your income off the books so to speak, you do everything in cash and stay away from credit cards and other trackable expenditures completely.

I don't think people need to justify their expenses, I think people need to justify why the income is not being reported on their tax return. The expenses are verified, but not the income.

Let's say it's a big drug lord and there's millions of dollars of cash. If some people have a little tip money, sure, pay cash for this, pay cash for that. But millions of dollars? Are you going to lay down thousands and thousands of dollars for everything? Hence that $10,000 cash report to the IRS.

In California, Franchise Tax Board will do a "sneak peak" to see if a tax return has been filed if you buy a car for $40,000 or more. If there's no tax return, they'll send a letter to the taxpayer and ask what's up??

David

Again - Diversity is a Good Thing! Don't make MOs all the same amount, don't make all deposits MOs and don't deposit MO's into accounts used to generate those MOs.:cool:

Where did we get the cash...

In the Days of the Mint, our government taught us to legally buy cash using credit to stimulate the economy and receive nontaxable benefits. This perfectly legal business model still works even if the AML folk hate on it. Who are we to ask questions or challenge the teachings of our government?

If that's the reasoning by banks, wouldn't depositing MOs to bank accounts worse than using MOs to pay bills?:confused:

I don't believe the clergy actually rates the level of sins of the heretics as better or worse because redemption of sinners is never an option. All sinners must be burned at the stake.:p