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The Physical Transport of Cash and Bearer Negotiable Instruments (BNIs) in Latin America

·Regional
Briefcase full of dollar bills representing the physical transport of cash and negotiable bearer instruments

Although there are many ways today to transfer money without physically carrying it, the use and transport of cash remains common. This is down to factors such as cash-dependent economies, the lack of access to financial services in certain areas and high levels of financial exclusion. The need to transport cash is therefore likely to persist in the short and medium term.

Just as cash is sometimes essential for legitimate transactions, criminal organisations also need to handle large amounts of it. These organisations move money from where it is generated to where it is needed in order to continue their unlawful activities, spend it or launder it.

Transporting cash may also be linked to other illegal activities, such as funding people or groups connected with terrorism, training for such purposes or planning terrorist attacks.

For all these reasons, it is necessary to understand the concepts, international recommendations and country-specific rules on this method used by criminals for money laundering (ML) or terrorist financing (TF).

Cross-border physical transport

This refers to the inbound or outbound physical transport of currency or bearer negotiable instruments from one country to another.

It can take various forms:

  • Physical transport by an individual, or in the luggage or vehicle accompanying that person.
  • Shipment of currency or BNIs as container cargo.
  • Postal shipment of currency or BNIs by an individual or a legal entity.

Cash

Banknotes and coins in circulation as a means of exchange.

Bearer Negotiable Instruments (BNIs)

We will consider the following:

  • Bearer monetary instruments, such as traveller's cheques.
  • Negotiable instruments — including cheques, promissory notes and money orders — that are either in bearer form, endorsed without restriction, made out to a fictitious payee, or otherwise in such form that title passes upon delivery.
  • Incomplete instruments — including cheques, promissory notes and money orders — that are signed but with the payee's name omitted.

As regards the international framework, the United Nations (UN) and the FATF have created a body of international law setting out countries' obligations, which we detail below.

United Nations Security Council resolutions

  • Resolution 1373

Allows for bilateral cooperation in which one country asks another not to make funds or other assets available to an individual or legal entity that, in the requesting country's view, meets the criteria for designation as a terrorist set out in the Council's resolutions.

  • 1999 International Convention for the Suppression of the Financing of Terrorism

Requires States Parties to consider introducing measures to detect or monitor the cross-border physical transport of cash and bearer negotiable instruments.

  • Resolution 2396

Urges Member States to step up their efforts to halt the threat posed by foreign terrorist fighters through border control measures, criminal justice, information sharing and countering extremism.

FATF Recommendations

Recommendation 32: cash couriers

This recommendation states that countries should have measures in place to:

  • Detect the cross-border physical transport of currency and BNIs.
  • Stop or restrain currency and BNIs suspected of being related to TF or ML.
  • Stop or restrain currency and BNIs that are falsely declared or disclosed.
  • Apply appropriate sanctions for making a false declaration or disclosure.
  • Enable the confiscation of currency and BNIs related to TF or ML.

Most used payment methods in Latin America

According to Worldpay's Global Payments Report 2024, cash remains the leading payment method at the point of sale (POS) in our region, but that lead is temporary. In 2023, for the first time, cash shared the lead with credit cards, each accounting for 29% of POS transaction value across the region. For 2024, credit cards are expected to overtake cash as the main in-person payment method. In 2023, cash was the leading POS payment method in Argentina, Colombia, Mexico and Peru.

Rules in some countries of the region

Drawing on GAFILAT's document "Strategic Analysis of the Physical Transport of Cash and Bearer Negotiable Instruments in the Latin American Region — 2021", we set out the rules on this matter in several countries of the region and what they provide.

Ecuador

Organic Law on the Prevention, Detection and Eradication of Money Laundering and the Financing of Crimes.

  • Every passenger entering or leaving the country with cash amounting to USD 10,000 or more, or the equivalent in other currencies, must declare it to the relevant authorities.
  • On arrival in Ecuador, the passenger must complete the Customs Registration Form (FRA), handed out by airlines during the flight and subsequently submitted to the customs authority.
  • The lawful origin of the funds being taken out of the country is verified.

Peru

Law No. 28306, sworn written declaration system, and Supreme Decree No. 195-2013-EF, notification to the UIF.

  • Any person, national or foreign, entering or leaving the country must declare under oath any bearer negotiable financial instruments or cash they are carrying above USD 10,000.
  • Carrying amounts above USD 30,000 in or out of the country is prohibited.
  • Where larger amounts need to be transported, this must be done through companies legally authorised by the Superintendence of Banking, Insurance and Pension Funds (SBS).

Colombia

DIAN Resolutions 63 and 87 (2016).

  • For exchange control purposes, individuals or family groups of travellers entering or leaving the country through any airport, river or sea port or land border crossing with more than USD 10,000 in cash, or the equivalent in other currencies, or with money instruments exceeding that amount, must submit the relevant form to the customs authority.
  • Applies to all individuals and legal entities, whether by air, post or cargo.

Bolivia

Supreme Decree No. 29681 of 2008.

  • All individuals and legal entities — public, private or mixed, domestic or foreign — must report amounts between USD 10,000 and USD 50,000, with authorisation from the Central Bank of Bolivia (BCB).
  • Between USD 50,000 and USD 500,000, authorisation from the Ministry of Economy and Public Finance is required.
  • Physically moving foreign currency out of, or into, the country in amounts between USD 50,000 and USD 500,000 requires BCB authorisation. For larger amounts, authorisation comes from the Ministry of Economy and Public Finance.
  • Transporting cash as cargo is authorised only for the Central Bank of Bolivia, through a Goods Declaration.

Brazil

RFB No. 1385, 15 August 2013.

Individuals entering or leaving the country with funds in domestic or foreign currency exceeding BRL 10,000 (ten thousand reais) must submit, at the customs post with jurisdiction over the place of entry or exit, a declaration of the currency, cheques and traveller's cheques they are carrying.

Chile

Law 19,913 and Circular Letter No. 561/2006 of the National Customs Directorate.

  • Anyone carrying or transporting cash or bearer negotiable instruments into the country from abroad above USD 10,000, or the equivalent in other currencies, must inform Customs so that it can be registered and entered directly into the online application.
  • Where cash or BNIs are sent by post, courier or other means, the information must be entered directly into the online application developed by the UAF at the time of actual entry into or exit from the country, and a copy of the certificate issued must be given to the declarant, signed by both the Customs officer and the declarant.

Argentina

General Resolution 2704 of 2009 (entry) and Customs Code, articles 863, 876 and 905.

  • Travellers of any category and crew members bringing cash and/or monetary instruments into Argentine territory as luggage or personal effects, in foreign currency or legal tender, worth USD 10,000 or more, must declare it to the customs service on entry using form OM-2249-A.
  • For unemancipated minors under sixteen (16), the threshold is USD 5,000 or more.
  • There are no provisions covering the entry of money or BNIs by post or as container cargo.
  • Negotiable instruments (bearer or otherwise) are not covered.
  • Taking more than USD 10,000 out of the country physically is prohibited. Amounts above that threshold may only be transferred through the financial system (see AFIP General Resolution No. 2705/2009, 5 November 2009).
  • General Resolution 2705/2009 (exit), amended by AFIP GR 3010/2010, articles 1-5.
  • Taking banknotes, coins and minted precious metals out of the country is governed by AFIP General Resolution 2705, which prohibits the exit of more than USD 10,000.

Costa Rica

Central American Customs Code, Law 8204 and Legislative Decree 021-2014: notification to the UIF.

Obligation to declare the carrying of money in amounts of USD 10,000 or more, or the equivalent in another currency, when leaving or entering the country.

Mexico

Customs Law, article 9; Federal Tax Code (applied on a supplementary basis), article 105 l; Customs Law Regulations, article 8; General Foreign Trade Rules 2020, rule 2.1.3.

  • The system applies to the entry and exit of cash, domestic or foreign cheques, payment orders or any other document, or any combination of these.
  • It also covers post and cargo.
  • Information on amounts above USD 10,000 is processed by Customs officers in the Money Declaration Capture System (SICADED).

Shella Mendieta

AML/CFT Specialist

At Líderes Empresariales APLA we specialise in training and advising compliance officers and in implementing money laundering, terrorist financing and proliferation financing prevention rules for the various obligated entities. We help you avoid penalties for non-compliance — get in touch.

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