This article provides guidance on the definition of a cash intensive business. A cash intensive business is a type of business that has substantial volumes of cash transactions, limited record keeping and/or high customer turnover. These businesses may present a higher risk of money laundering due to the possibility that illicit funds could be mixed with legitimate income.
Financial institutions should carefully evaluate a customer’s cash-intensive status and consider whether it warrants enhanced due diligence. This should be done in accordance with the applicable anti-money laundering and countering the financing of terrorism (“AML/CFT”) rules and guidelines, including appropriate supervisory expectations.
Examples of cash-intensive businesses include bail bonds, beauty shops, car washes, check cashing establishments, coin operated amusements, laundromats, scrap metal, some convenience stores and Taxicabs. In addition, they might also be considered as a money-laundering risk because their operators might use them to conceal their criminal activities. The financial institution should carry out CDD and, where required, EDD, with such customers and should review them on a regular basis.