Ecuador Orders Banks to Red Flag Cash Withdrawals over US$5,000


EspañolEcuadorians who withdraw more than US$5,000 in cash from their bank accounts will be reported to the authorities for suspicious behavior, according to a resolution issued by the Superintendency of Banking (SBS) on Wednesday, June 3.

Cash withdrawals of over $5,000 from private bank accounts will be reported to the Superintendence of Banking in Ecuador.
Cash withdrawals of over $5,000 from private bank accounts will be reported to the Superintendence of Banking in Ecuador. (Tax Credits)

The regulation, signed by SBS General Manager Rodrigo Landeta, requires private banks and other financial institutions to report the details of these transactions to the SBS. Each bank will similarly be required to report on companies that withdraw more than $100,000 from their accounts.

“Until now, the only thing we required [banks to report] were cash transaction for prevention and control. This is not new, but what we didn’t have before was a form to be filled out monthly to prevent money laundering,” Banking Superintendent Christian Cruz said.

The goal is to “avoid money laundering and illicit enrichment,” Cruz says. The measure will be enforced on “cash transactions only,” while other transactions will “continue to be reported if they surpass the $10,000 limit,” the Banking superintendent said during a meeting with the Workers’ Committee of the National Assembly.

Cruz denied allegations that the SBS issued the new rules as a response to bank-run rumors, or to enforce foreign-exchange controls.

Ecuador’s banking sector, however, is pushing back against the measure. Bank of Pichincha President Antonio Acosta has warned his bank won’t “provide any information.”

“If the requests are against the law, we will have to oppose them,” Acosta said. Providing this sort of information “would go against the essence of the financial system.”

“Customers can be calm, because they trusted their money and savings to us, and we have a legal and moral obligation to protect those assets with all the stealth and strength that circumstances allow,” Acosta said.

According to the SBS, banks and other financial institutions must deliver the monthly report of transactions within the first five days of every month, and those who do not comply could face potential fines.

Sources: El Comercio, Metro, El Universo.

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