FinCEN Director: SAR Activity Review Has Broad Value, Utility
The Financial Crimes Enforcement Network released its 11th issue of the Suspicious Activity Report (SAR) Activity Review Issue 11 last week. With guidance from the BSA Advisory Group (BSAAG), the review covers the suspicious activity reports issued by financial institutions including depository institutions, securities and futures businesses, money services businesses, casinos and card clubs and insurance companies.
The BSAAG meets twice each year in Washington, D.C. and serves as the principal forum where issues relating to the administration of the BSA are discussed. The Director of FinCEN, James Freis, chairs the BSAAG. Freis is responsible for ensuring that relevant issues are placed before the group for review, analysis, and discussion so that it may make policy recommendations to the Secretary of the Treasury.
In the issue, Freis noted the importance that FinCEN and law enforcement place on SARs and â€œthe broad value and utility of BSA data.â€ The review is â€œa product of continuing dialogue and close collaboration among the nationâ€™s financial institutions, law enforcement officials and regulatory agencies,â€ the review stated. There are 19 separate regulatory agencies at the federal level that take part in the review.
Freis continued saying that financial institutions will â€œfind this information valuable not only in conducting your own risk analysis but also in better understanding how this information truly helps law enforcement, intelligence and regulatory agencies.â€
The review continues to expand sections on descriptions of law enforcement cases that demonstrate how important and valuable BSA data is to the law enforcement community. Ranging from drug investigations to insurance fraud, most of these cases are the result of financial institutionsâ€™ proactive filings of BSA reports. Freis stated, â€œWe are confident that the additional details provided in the law enforcement case studies will prove to be helpful for all our readers, particularly those with BSA filing obligations as the details may help them better identify suspicious activity.â€
In the last six months, FinCEN has issued a number of industry assessments based on its independent analysis of SAR data. These assessments looked at the role of domestic shell companies in financial crime, the growth in money laundering-related suspicious activity reporting associated with the commercial real estate industry, and the rise in suspected mortgage loan fraud.
Other recent actions by FinCEN include the establishment of FinCENâ€™s Office of Outreach Resources with the mission of providing support to institutions subject to BSA requirements through the development of BSA guidance, outreach, training, and education. The Outreach Resources Office is responsible for coordinating and supporting the work of the BSA Advisory Group (BSAAG).
The Financial Crimes Enforcement Network (FinCEN) also updated two Bank Secrecy Act guidance. Financial institutions are recommended to read these guidance for the latest information on maintaining accounts and Suspicious Activity Report (SAR) supporting documentation. Guidance - Requests by Law Enforcement for Financial Institutions to Maintain Accounts