Frequently Asked Questions

1. I don’t have an AML program in place but understand the regulations, such as when to file forms 8300 and 1099-B. Do I need to have an actual compliance program?
If you meet the minimum requirements shown below, federal law requires that you have a compliance program in place. You bought $50,000 or more of Covered Goods in a calendar or tax year from non-dealers/retailers (that is, retail purchases), AND You sold $50,000 or more of Covered Goods in a calendar or tax year to non-dealers/retailers (that is, retail sales). are some exceptions that may apply if you don’t meet the above minimums. These include purchasing $50,000 or more of “Covered Goods” from a foreign supplier who is not subject to US AML regulations and purchasing $50,000 or more of “Covered Goods” from a US supplier (wholesaler or other dealer) who does not have an AML plan in place. (For more information refer to “Covered Goods.”)
2. I put together my own compliance program a few years ago. Do I need to have one professionally done?
It depends on whether or not the program you created meets federally mandated requirements. These include a risk assessment, designation of a compliance officer, a written plan that addresses risks, processes and procedures, a training program, written evidence of training, and periodic independent reviews to identify any deficiencies and recommend improvements.
3. The majority of my business involves buying and selling numismatic coins. Once in a while I buy and sell bullion products. Do I need a compliance program?
Most dealers are surprised to learn that it only takes buying and selling a relatively modest amount of bullion (or bullion-like coins, such as common date $20 Saints and Libs, 90% silver coins, etc.) from the retail pubic to reach the minimum threshold.  Refer to FAQ number 1 above.
4. I am primarily a wholesale dealer. Only rarely do I transact purchases from, or sales to, the retail public. Do I need an AML plan?
Dealers who work almost exclusively on a wholesale basis might need an AML plan. To learn if need to comply, review the information in FAQ number 1 above. Also, if you have more than $50,000 in transactions of “Covered Goods” each calendar year (or tax year) with dealers or wholesales, those dealers and wholesalers may require that you have an AML Plan in place. Also, your bank, PayPal, Amazon and other financial institutions may require that you have one to maintain your financial relationship. These financial institutions are themselves audited and must meet Know Your Customer (often termed KYC) requirements. Coin dealers and jewelers are typically considered higher risk clients, thus trigging their request for your AML Program and Periodic Reviews.
5. What is an IRS Title 31 Audit?
If you are audited by the IRS they will want to see a copy of your AML compliance program, employee AML training records with signature forms, recent AML program reviews. Should you be unable to produce these documents you may be fined. Typically, the IRS gives you a period of time to put a written AML plan into place, designate a compliance officer, assess your firm’s risks, train staff, make changes to processes and recordkeeping procedures, and have the compliance program independently reviewed. When the IRS returns to determine if you have fully implemented required compliance components it is termed an IRS Title 31 Audit.
6. What are the potential penalties associated with not complying with AML regulations?
Penalties for not complying with these regulations range from “slap on the wrist” fines to potentially severe consequences including loss of business checking privileges, seizure of business assets, fines and possibly imprisonment.  Current Civil Penalties are shown below:
NEW PENALTIES EFFECTIVE AUGUST 1, 2016
Source: Federal Register/Vol. 81, No. 126/Thursday June 30, 2016/ Rules and Regulations 42503-42506
 CIVIL PENALTIES
VIOLATION MINIMUM MAXIMUM
Willful Violations of Bank Secrecy Act $53,909 $215,628
Willful or Gross Negligence - Record Keeping $19,787
Pattern of Negligent Activity $83,864
Negligent Violation $1,078
7. What information do you need from us to create our AML program and Review?
We provide confidential intake forms that make it easy to get started. The information requested relates to what types of material your business buys and sells, where you buy and sell, processes and procedures you have in place including recordkeeping systems and record retention, employee training and the like. For reviews we need copies of your purchase and sale transactions covering the review period. These could include Excel files generated by your financial software (such as QuickBooks) or paper copies of select transactions. Also, we attend many of the leading numismatic trade shows where we can sit down with you and get things rolling in just a few minutes. Shows we usually attend include the ANA World’s Fair of Money, FUN (Winter show), Long Beach, Whitman Baltimore and Central States, and various local shows.
8. We purchase European gold coins from dealers in France, Germany and Austria, many of which are common date. And, only sell those coins to US coin dealers. Do we need to have an AML plan in place?
If you purchase more than $50,000 a year in “Covered Goods” from foreign suppliers who are not covered by US AML regulations you need to comply.
9. We purchase precious stones and jewels from suppliers in Asia and Europe which we only sell to US jewelers and wholesalers. Do we need to have an AML plan in place?
If you purchase more than $50,000 a year in “Covered Goods” from foreign suppliers who are not covered by US AML regulations you need to comply.
10. We fabricate jewelry using precious metals, stones and jewels which we sell to sell to the retail public and other jewelers. Do we need to comply with AML regulations?
If 50% or more of the fabricated jewelry’s value is in the precious metals, stones and jewels you might need to comply. Refer to “Covered Goods.”