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Loophole to the New Treasury Rules for Cash Purchases?

Posted by Keith Darby on February 3, 2016

There have been concerns about how the Treasury department’s new anti-money laundering rules will affect cash real estate deals in Miami and NYC. The new procedures will require the buyers who make cash deals over $3MM to be disclosed. This is concerning because many buyers in these markets, especially at this level of real estate, prefer to stay anonymous and make purchases through LLCs. The government fears this anonymity supports illegal activity, but the real estate business fears this will deter healthy investments.  

Now fears can be eased because a loophole in the Treasury rules has been discovered. The department will only be monitoring cash deals done in bills or checks. It will not cover wire transfers. Keith Darby, RISE Realty President, says “Most deals are not done with stacks of cash. Wire transfers are most common for deals where a mortgage isn’t used.”

The Treasury’s disclosure requirements are just a test for now, but as the rules are implemented, it looks like not much will need to change in processing high value cash real estate deals in Miami.


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