Suspicious Activity Reporting (SAR) Filing Requirements
Below are the key Suspicious Activity Reporting (SAR) filing requirements as stipulated by the Financial Crimes Enforcement Network (FinCEN).
FinCEN is a bureau of the US Department of Treasury that is responsible for managing and enforcing Anti-Money Laundering and Bank Secrecy Act rules and regulations.
In the event of a suspicious transaction or activity, financial institutions are required to conduct suspicious activity reporting by filing a SAR.
Image Source: US Department of Treasury
General Requirements for Filing a SAR
In the event of any of the below activities / scenario, a financial institution is required to perform suspicious activity reporting:
- The financial services firm identifies or has reasons to suspect violation of a federal criminal law, and has substantial reason to believe that one of its employees, agents, executives, directors, contractor, officers, or affiliate has committed or aided in the commission of the federal violation.
- The financial services firm identifies or has reasons to suspect violation of a federal criminal law, for which there is an actual or possible loss to the bank (before reimbursement or recovery) that in aggregate totals $5,000 or more, and for which the bank has substantially identified one or more possible suspects.
- The financial services firm identifies or has reasons to suspect violation of a federal criminal law, for which there is an actual or possible loss to the bank (before reimbursement or recovery) that in aggregate totals $5,000 or more, and for which the bank no substantial basis for identifying one or more possible suspects.
- A banking activity or transaction(s) was conducted at the financial firm (with aggregate value of at least $5,000) and:
- The financial institution suspects the transaction or group of transactions to involve funds that have been derived from illegal / illicit / money laundering activities.
- The financial institution suspects the transaction or group of transactions to be structured transactions (transactions that are designed to evade Currency Transaction Reporting requirements)
- The financial institution believes that the transaction or group of transactions have no real business or lawful purposes
- The financial institution believes that the type transaction or group of transactions have substantially diverted from the expected transaction type of the customer
The below types of criminal activities also warrant performing suspicious activity reporting:
- Transaction Structuring
- Money Laundering
- Credit Card / Debit Card Fraud
- Identity Theft
- False Statements to a Bank Officer
- Check Fraud
- Debit Card Skimming
- Credit Card Skimming
- Financial Crimes
- Check Kiting
- Commercial Loan Fraud
- Computer Intrusion
- Consumer Loan Fraud
- Counterfeit Check
- Counterfeit Instrument
- Counterfeiting a Credit Card
- Counterfeiting a Debit Card
- Misuse of Position
- Mortgage Loan Fraud
- Mysterious Disappearance
- Wire Transfer Fraud
- Terrorist Financing
- Computer intrusion
Suspicious Activity Reporting is a Subjective Affair
The decision making process for filing a Suspicious Activity Report is inherently subjective in nature. As such financial institutions need to review each suspicious activity or transaction on a case-by-case basis when determine whether or not to conduct suspicious activity reporting
AdvisoryHQ (AHQ) Disclaimer:
Reasonable efforts have been made by AdvisoryHQ to present accurate information, however all info is presented without warranty. Review AdvisoryHQ’s Terms for details. Also review each firm’s site for the most updated data, rates and info.
Note: Firms and products, including the one(s) reviewed above, may be AdvisoryHQ's affiliates. Click to view AdvisoryHQ's advertiser disclosures.