Likely Reportable
Is a Cash Condo Sale to an LLC Reportable?
An LLC buys a condo with cash and no bank mortgage. This is the textbook pattern the rule was designed to catch.
Fact pattern
Coastal Ventures LLC, a newly formed Delaware entity, purchases a two-bedroom condominium in Miami for $1.4 million. The full purchase price is paid via wire transfer from the LLC's bank account. No mortgage is recorded against the property. The LLC was formed three weeks before the purchase.
Analysis
This is the core pattern the FinCEN RRE rule targets. An LLC (entity buyer) acquires residential property (condo) without any financing from a BSA-regulated lender. All three triggering conditions are met: entity transferee, non-financed transaction, and covered residential property.
The fact that the LLC was recently formed and is paying entirely in cash are exactly the characteristics that historically correlate with money laundering through real estate. Before this rule, nobody in this transaction was required to ask who controls Coastal Ventures LLC or where the $1.4 million came from.
The reporting person (likely the settlement agent at Tier 1 of the cascade) would need to collect beneficial ownership information from all individuals who own 25% or more of the LLC or exercise substantial control over it, then file the Real Estate Report through BSA E-Filing within the statutory deadline.
Key factors
- Entity buyer (LLC) triggers the rule's transferee requirement
- All-cash purchase means no BSA-regulated lender is performing due diligence
- Condominium is a covered residential property type
- Recently formed entity with large cash purchase is the classic red-flag pattern
- No exemption applies to these facts
Next step
Run the transaction through the checker to capture a determination PDF and keep your file trail complete.
Related scenarios
Is a Bank-Financed Home Purchase by an LLC Reportable?
An LLC buys a house with a bank mortgage. The financing exclusion takes this out of scope because the bank is already doing the compliance work.
Is a Mixed Financing Transfer Reportable?
A trust buys property with both a bank loan and private financing. Mixed financing structures need careful analysis because the details matter.