DATE:         July 31, 2000

IRE:             TRANSPORTATION OF CURRENCY OUT OF THE UNITED STATES

STATUES AND REGULATIONS.  Congress by 31 US Code § 5315 has authorized the Secretary of the treasury to promulgate regulations requiring reports on foreign currency transactions.  Section 536 requires every person or agent to full a report when the person or agent knowingly transports or is about to transport more than $10,000 form the United States.

The Secretary issues 31 CFR section 03,23 (a) which states:

Each person who physically transports, mails, or ships, or causes to be physically transported, mailed, or shipped, or attempts to physically transport mail, or ship, or attempts to cause to be transported, mailed, or shipped, currency or other monetary instruments in an aggregate amount exceeding $10,000 at one time from the United States to any place outside the United States, or into the United States from any place outside the United States, shall make a report thereof.  A person is deemed to have caused such transportation, mailing or shipping when he aids, abets, counsels, commands, procures, or requests it to be done by a financial institution or any other person.

REPORTING.  To report the transportation of currency exceeding $10,000, Customs Form 4790 must be completed.  Any person who transports or causes the transportation of an excess of $10,000 out of the United States must complete this form.

The question presented is what are the reporting requirements is a vessel agent delivers more than $10,000 to a master for the purpose of provisioning g the ship and paying the crew.  The answer depends on how much money is left over after a master has made all of his required payments in the United States.  

If, after making all of the required payments, a vessel master maintains in his possession $10,000 or less, no reporting is necessary if the vessel leaves the United States, regardless of how much money was delivered to the master initially.  if, however, the amount left over is greater than $10,000, CF 4790 must be completed.

The reporting requirement is based on individuals in possession of currency, not total amounts of currency.  
For example if ten people were leaving the country on one vessel and each had in their possession $9,000, no report would be necessary.  However if the agent makes two deliveries of $6,000 tot he master and more than $10,000 remains when he departs for a foreign country, then CF 4790 must be completed and promptly filed with the local Customs Office during normal business hours, or after hours can be presented to any Customs Office on duty.  The master should keep a copy.

PROCEDURE.  Therefore, in practice, a vessel agent should deliver copies of CF 4790 along with any large sum of money being delivered to the master.  The vessel agent should instruct the master that if, after making all necessary payments in port, more than $10,000 remains which the master intends to take from the country, then the master must complete and file the report in the manner mentioned above.  That will place the responsibility on the master and prevent any claim against the agent or the vessel owner that they "caused" the transportation of money out of the United States without completing the necessary report.

PENALTIES.  Civil and Criminal penalties including possibly large fines and imprisonment of up to five years, are provided for failure to file the requisite repot, supply information or for filing a false or fraudulent report.  The civil penalty for violation of § 5315 and 5316 may not be more than the amount of the monetary instrument for which the report was required, or $10,000, whichever is greater.  Also the currency or monetary instruments attempted to be exported may be subject to seizure.

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