Financial Crime World

Financial Institutions Warned to Be More Vigilant After Customer Complaints

A recent surge in customer complaints has prompted financial institutions to step up their game and conduct further research on suspicious transactions. According to sources, the Treasury Department’s Financial Crimes Enforcement Network (FinCEN) requires banks and other financial institutions to report certain activities that may indicate money laundering or terrorist financing.

Foreign Bank Accounts Under Scrutiny

The Treasury Department’s 31 CFR 103.24 regulation mandates that individuals with a financial interest in or signature authority over foreign bank accounts exceeding $10,000 must file an annual report by June 30 of the following year. The report, known as Form TD F 90-22.1, is available on the FinCEN website and provides crucial information about financial transactions.

Monetary Instruments and Funds Transfers Under the Microscope

Financial institutions are also required to maintain records of sales of monetary instruments purchased with cash in amounts between $3,000 and $10,000. This includes identifying information such as:

  • Name
  • Address
  • Date of birth
  • Social security number or alien identification number

In addition, financial institutions must obtain certain information for funds transfers exceeding $3,000, including:

  • Sender’s name
  • Sender’s address
  • Recipient’s name
  • Recipient’s address
  • Account numbers

Financial Institutions Urged to Be More Proactive

Experts warn that financial institutions must be more vigilant in monitoring customer transactions to prevent money laundering and terrorist financing. “Financial institutions need to conduct further research on suspicious transactions and determine whether a Suspicious Activity Report (SAR) should be filed with FinCEN,” said a financial expert.

Customer Due Diligence and Suspicious Activity Reporting

The Financial Crimes Enforcement Network provides detailed guidance on customer due diligence and suspicious activity reporting. Financial institutions are urged to refer to this chapter for more information on how to conduct further research on customers’ transactions and determine whether a SAR should be filed.

Key Takeaways

  • Financial institutions must be more vigilant in monitoring customer transactions
  • Conduct further research on suspicious transactions
  • Determine whether a Suspicious Activity Report (SAR) should be filed with FinCEN
  • Refer to the Financial Crimes Enforcement Network’s guidance on customer due diligence and suspicious activity reporting

In light of these regulations, financial institution management is advised to review their records and procedures to ensure compliance with the Treasury Department’s requirements.