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2 questions- 1 what about millionaires? They are only covered up to $250,000 against bank failure?

2: Millionaires routinely deposit and remove large amounts- Are they scrutinized all the time? a $10,000 deposit is chickenfeed to them- surely there are banks that allow more spending on income levels?

1) Correct. But that limit is per account, or per person per type of account per institution(?), or something like that. So breaking your money across different accounts at different banks means you get millions of free insurance, not just $250M. Plus, most millionaires don't just sit on a bunch of cash at the local bank. Their money is tied up in businesses or real estate or investment accounts or etc. Most low-level millionaires probably couldn't make a cash payment of $250M without a couple days notice to liquidate.

As others have mentioned, these laws are mainly cash only. Millionaires aren't regularly running cash unless it's drug money, or something similar. Getting that much cash on a consistent basis, for an individual, is very difficult, unless you're running a decent small business under your own name (not a good idea, but that's not really part of this). Most consistent cash transactions of this size are businesses, and their consistent history, plus business-related actions, mean these laws don't matter much.