FATF ¦ R.32 Cash Couriers

Recommendation 32: Tackling Cash Couriers to Prevent Money Laundering and Terrorist Financing

Recommendation 32 addresses a clear vulnerability in the global financial system: the physical cross-border movement of currency and bearer negotiable instruments (BNIs). Large sums carried across borders in cash or bearer instruments can bypass regulated financial channels and enable money laundering, terrorist financing and related predicate offences. The Recommendation sets out standards for detecting such movements, restraining suspicious funds, sanctioning false declarations or disclosures, and enabling confiscation where funds are linked to criminal activity. Its implementation strengthens border controls, improves information flows to financial intelligence units (FIUs) and supports international cooperation.

Systems to detect and monitor cash couriers

Countries can meet the standard through either a declaration system or a disclosure system, and many jurisdictions use hybrids. Under a declaration system, travellers must report when they carry currency or BNIs above a preset threshold (the FATF baseline is USD/EUR 15,000).

Declaration systems can be designed in three main ways:

• a written declaration required of all travellers (for example, a customs form that asks whether the traveller carries cash/BNIs);
• a written declaration required only of those carrying amounts above the threshold; or
• an oral declaration system, where travellers signal carriage by selecting a “red channel” or otherwise reporting to a customs official.

In contrast, a disclosure system does not require an upfront declaration; instead, travellers must provide truthful information to authorities when requested.

Core operational elements required by the standard

Whichever system is adopted, Recommendation 32 requires a set of common features to make detection and response meaningful. The measures must apply to both incoming and outgoing movements. Competent authorities must have the power to obtain additional information about the origin and intended use of the currency or BNIs when a false declaration/disclosure is discovered or when there is suspicion of criminality. Information collected through declarations or disclosures must be available to the FIU, either by notification or direct access, so that cross-border incidents can be analysed for indicators of money laundering or terrorist financing. Effective domestic coordination among customs, immigration and other agencies is essential to make the system work in practice.

Stopping, restraining and confiscating suspicious funds

Recommendation 32 obliges states to provide competent authorities with legal authority to stop or restrain currency or BNIs where there is suspicion of money laundering or terrorist financing, or where declarations/disclosures are false. Such powers should allow authorities to hold funds for a reasonable time while investigating whether evidence of criminal conduct exists. Where funds are found to be connected to terrorist financing, money laundering or predicate offences, states should adopt measures — consistent with the broader confiscation standard under Recommendation 4 — to enable seizure and confiscation of the currency or BNIs.

Bastian Schwind-Wagner _Follow

"Recommendation 32 strengthens border controls against the misuse of physical cash and bearer instruments by requiring detection mechanisms, powers to restrain suspicious funds, and sanctions for false reporting. Proper implementation balances targeted enforcement with safeguards to avoid impeding legitimate trade and capital movements.

Effective application depends on clear legal frameworks, inter-agency coordination, and adequate resourcing of customs and FIU operations. Regular training, user-friendly reporting processes, and international cooperation are essential to turn the standard into operational outcomes."

Sanctions and resources

Persons who make false declarations or disclosures must face effective, proportionate and dissuasive sanctions, whether criminal, civil or administrative. The same standard applies to those carrying cash or BNIs linked to criminal activity. Authorities responsible for enforcing Recommendation 32 should be properly resourced with sufficient financial, human and technical capacity. Staff must maintain high professional standards, confidentiality and integrity, and receive training sufficient to detect and assess suspicious cross-border currency movements.

International cooperation and information retention

To facilitate cross-border investigation and mutual assistance, states should design systems that retain basic information whenever a declaration/disclosure exceeds the USD/EUR 15,000 threshold, when a false declaration/disclosure is detected, or when there is suspicion of money laundering or terrorist financing. At a minimum, retained data should include the amount of currency or BNIs involved and identification data for the bearer(s). This retained information enables timely cooperation under the FATF framework for mutual legal assistance and cross-border inquiries.

Scope and practical exclusions

Recommendation 32 focuses on currency and BNIs and does not include gold, precious metals or precious stones within its core scope, despite their liquidity. Those items may instead be regulated under customs laws; where unusual movements of such valuable commodities are observed, authorities are encouraged to notify and cooperate with counterparts in origin or destination countries to establish source, destination and purpose and take appropriate action.

Protecting legitimate trade and capital flows

The interpretive guidance emphasizes that controls must be implemented with strict safeguards so that legitimate international trade payments and freedom of capital movements are not unduly restricted. Systems should be proportionate, targeted and designed to minimise interference with lawful economic activity while maximising the ability to detect and disrupt illicit use of cash couriers.

Practical considerations for policymakers

Implementing Recommendation 32 requires more than a notification form. Authorities should design clear rules for thresholds and reporting, establish secure channels to transmit declaration information to FIUs, build protocols for inter-agency coordination at points of entry, and set out legal standards for temporary restraint and confiscation that respect due process. Communication campaigns at ports of entry and user-friendly declaration forms reduce unintentional non-compliance. Regular training for border and customs officers, investment in data systems that allow rapid cross-checking against watchlists and financial intelligence, and agreements with neighbouring states and major transit hubs will increase effectiveness.

Conclusion

Recommendation 32 closes an important loophole by bringing physical cash movements into the AML/CFT perimeter. By requiring detection mechanisms, legal powers to restrain suspicious funds, sanctions for false reporting and retention of core data for cooperation, the Recommendation enhances states’ capacity to disrupt money laundering and terrorist financing conducted through cash couriers while preserving legitimate cross-border flows. Proper design, resourcing and inter-agency coordination are the practical keys to turning the standard into operational impact.

Dive deeper

• FATF ¦ The FATF Recommendations ¦ Link
• FATF ¦ Luxembourg’s measures to combat money laundering and terrorist financing ¦ Link