Final answer:
The process of breaking down large transactions into smaller ones to avoid reporting is called structuring.
Step-by-step explanation:
The process of breaking down large transactions into smaller ones to avoid reporting is called structuring.
Structuring is a method used by individuals or businesses to avoid triggering suspicious activity reports that are required by law when a transaction surpasses a certain threshold.
For example, if someone has $20,000 in cash and wants to deposit it into a bank account, they might deposit $5,000 on one day, $5,000 on another day, and so on, instead of depositing the full amount at once. By doing this, they are breaking down the large transaction into smaller ones, thereby avoiding the reporting requirement.