Suspicious Activity Reports (SARs) Filing Guidelines

The Financial Crimes Enforcement Network (FinCEN) requires financial institutions to file Suspicious Activity Reports (SARs) for any activity that is potentially indicative of money laundering or other illicit financial activity. Here are the key guidelines and regulations to follow:

Customer Due Diligence (CDD)

• No requirement for media searches: The CDD regulations do not require media searches or particular screenings, but financial institutions may collect more information based on risk assessments to better understand customer relationships and detect suspicious transactions.
• Risk-based approach: Financial institutions should use a risk-based approach to determine the level of due diligence required for each customer.

SAR Narrative

• Clear, complete, and concise description: A clear, complete, and concise description of the suspicious activity is required in the SAR narrative.
• Character limit: Filers should focus on providing relevant information within the character limit (20,000 characters).
• Attachments: Additional information can be included as attachments or supporting documentation.

Additional SARs

• No multiple SARs for same activity: Financial institutions are not allowed to file multiple SARs for the same suspicious activity to accommodate longer narratives.
• Use of attachments: Attachments (such as CSV files) can be used to include tabular information that is too large or complex for the narrative.

Supporting Documentation

• Retention requirement: Filers must retain all supporting documentation for five years from the date of the report.
• Availability to authorities: Supporting documentation must be made available to appropriate authorities upon request.

Key Takeaways

• Financial institutions should focus on providing clear, concise narratives that describe the suspicious activity.
• Attachments (such as CSV files) can be used to include tabular information that is too large or complex for the narrative.
• Supporting documentation must be retained and made available to authorities upon request.