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What makes banks suspicious

upon request.
An essential task of expanded and intensified analysis of particular the shift in focus — or rather the expanded focus — that suspicious activity reporting ultimately must attain.
One reason that expanded analysis is critical may be the pattern of the transactions now being reported.
There’s every reason to trust that most U.S. banks are now paying careful attention to anomalies at the teller’s window (or simply the ATM machine) and reporting them at length.

The financial institution may consider this to be suspicious activity and may file a Suspicious Activity Report.


Still, within our concern for your security, we may deactivate your current card and issue you a fresh one as a precaution to help keep your account safe.
6 The SAR narrative refers to Part V of the Suspicious Activity Report by Depository Institutions (FinCEN Form 111), titled Suspicious Activity Information Explanation/Description.
This mandatory section is usually to be used to provide a whole chronological account of the suspected violation of law or suspicious activity.
Conduct thorough research and analysis to assemble as much information as possible about the potentially suspicious activity.
SARs alert bank supervisory agencies like the FDIC to fraud so that they can initiate a proper and timely response.
There is a natural hesitancy for organizations to track the partnership between the volume of reported information and the opening of particular cases.

  • One of the basic principles of SARS is that information being reported should be distributed around financial regulators and to police personnel quickly and as reported (that is, without being delayed for additional reviewing and sorting).
  • A national bank shall maintain a copy of any SAR filed and the original or business record equivalent of any supporting documentation for a period of five years from the date of the filing of the SAR.
  • Identifying suspicious activity involves monitoring customer transactions, identifying patterns, and monitoring for warning flag.

In some instances multiple departments may be involved in researching a merchant account.
A suspicious activity report (SAR) would then be completed if warranted.
Reporting suspicious activity isn’t just a legal obligation, but it is also essential for preventing financial crimes.
By identifying and reporting suspicious activity, banks can prevent criminals

Legal Data & Document Management

The lender compliance area is responsible for monitoring all customer operations to identify those indicating possible money laundering.
Procedures must identify transfers that are unjustified or suspicious transactions that trigger early indicators.
Albert has been a client for pretty much five years and has an established account history and incredibly predictable transactions.
Every month, he deposits $5,000 in to the account and buys an index fund.
One day, he starts to receive weekly transfers of $9,000 in to the account.

  • The account holder had no known business relationship with other countries.
  • Unfortunately, many banks make the error of focusing their efforts on deposit accounts and paying less attention to other products and services, particularly lending.
  • For a practical example of a situation in which a SAR would be necessary, consider a customer who deposits exactly the same amount of money in their account monthly.
  • First, the type of crimes included in the reporting requirements makes it counter-productive to segregate reports geographically.
  • The average input posting time (that is, the time between the date a written report is received and the time it becomes available to anyone who has direct dial-in access to SARS) is approximately 3.4 workdays for magnetic input and 9.7 workdays for paper input.
  • However, there are many online tutorials and databases to greatly help financial employees, legal professionals, and lay people navigate the complexities of the reporting process.

After the money landed, he called Synchrony to ask if he could transfer some of it — a sum bigger than $10,000 — to his checking account at TD Bank.
In Todd Zolecki’s case, his bank didn’t shutter his account, nonetheless it did shut him out from access to his own money.
In some instances, banks could be completely upfront about why they’ve made a decision to shutter a customer’s account.
The account may have been inactive for too much time, or a consumer might have been generating too many overdrafts.
Finance institutions filed 1.4 million of the SARs in 2021, according to a bureau of the Treasury Department.

GAO recommends that DOJ (1) include data on the use of BSA reports in its ongoing agency-wide efforts to really improve data collection, and (2) involve its Chief Information Officer and Statistical Official, in the look of its annual BSA statistical report.
To facilitate this feedback, the Department of Justice is required to provide information about the usefulness of these reports.
Customer service representatives might not know if this type of report was filed (or anything about its contents), which might be why it usually is hard to allow them to explain account closures to customers.
Banks can close a customer’s account for any reason, anytime, a point that is buried in the fine print of its customer agreements.
When they do dump an account, it’s usually because they’re trying to protect the institution (or the client) from a potential fraud.

The breakdown by state or territory may, in some cases, reflect the positioning of a central office that filed the SAR form rather than the branch or office where in fact the reported activity occurred.
A whole breakout by state and territory through the 18-month period has been provided to the American Bankers Association.
2 Approximately 150,000 CTRs filed in 1995, the last full year the prior system was in place, were marked as suspicious.

Chase said that when it needed to close an account, it tried to provide customers enough time to go to another institution.
“Closing an account is usually a last resort, after other options have been considered, to safeguard our customers and the bank,” a spokesman at JPMorgan Chase said.
•    A loan does not have any legitimate business purpose, supplies the bank with significant fees for assuming little if any risk or obscures the movement of funds (for example, a loan that’s designed to a borrower and then immediately sold to an entity related to the borrower).

Such notice will include the foundation for the revocation and will provide an opportunity for the national bank to submit a reply to the OCC.
The OCC will consider any response before deciding whether to revoke an exemption and provide written notice to the national bank of the OCC’s ultimate decision to revoke an exemption.
(2) The OCC will respond in writing to a national bank that submits a request pursuant to paragraph (m)(1) of the section after considering whether the exemption is consistent with the factors in paragraph (m)(1) of this section.
Any exemption granted by the OCC under paragraph (m)(1) of this section will continue for enough time specified by the OCC.