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#1944370 - 07/22/14 09:30 PM Continuation SAR timeline Confusion
pat1010 Offline
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Hopefully someone can help clear up the confusion. My department is basically split down the middle when interpreting the timeframe for filing a continuation SAR. I have read some of the previous threads and haven’t been able to find more clarification.

The review period for a continuation SAR starts at day 31 and extends 90 days. The SAR is filed on day 120.

Here is where we differ in interpretation:

Viewpoint #1: if there is a continuation SAR from that point, your 90 day investigation would start the day after the SAR was filed. It would include the 30 day gap in information (from day 91-120 of previous continuation SAR) and you would file 120 days from previous file date. There would be no gap in information and a SAR would be filed every 120 days and you’d be filing for activity that occurred within the previous 3 or 4 months.

Viewpoint #2: if there is a continuation SAR from that point, your 90 day investigation would start the day your investigation ended on the previous SAR (day 91 of the previous SAR). You would file that SAR 120 from the day the previous SAR was filed. So every time you filed a continuation SAR on someone, you’d be filing further and further from when the activity occurred.

Again, any clarification would be very much appreciated.
Last edited by pat1010; 07/22/14 09:31 PM.
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#1944377 - 07/22/14 09:52 PM Re: Continuation SAR timeline Confusion pat1010
Elwood P. Dowd Offline
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A series of continuing SARs is like a chapter book where each successive chapter covers the next 90 days. You had 30 days after the end of the 2nd 90 day period to file the second SAR. You will have 30 days after the end of the 3rd 90 day period to file the 3rd SAR.
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#1944423 - 07/23/14 01:09 PM Re: Continuation SAR timeline Confusion pat1010
pat1010 Offline
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Thanks Ken!

So basically, we are investigating every 90 days and we have 30 days from that point to file a SAR for the immediately preceding 90 days. So in actuality, we have 120 days to file a continuation but we end up filing every 90 days because the previous filing overlapped with investigation?

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#1944476 - 07/23/14 02:33 PM Re: Continuation SAR timeline Confusion pat1010
John Burnett Offline
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If you look at the description of the timing for filing SARs on continuing suspicious activity that is provided in the BSA/AML Exam manual, you will see very clearly that if the activity is ongoing, you'd be expected to file a SAR once each 120 days, with the result that you'd file three SARs in approximately a year. There could, in fact, be three 30-day periods in that year that are not covered by a SAR.
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#1944482 - 07/23/14 02:40 PM Re: Continuation SAR timeline Confusion John Burnett
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Question 16 would be the more recent source. It does say that only three SARs would be filed in a 12 month period, but I do not believe it indicates there will be any gaps in their coverage. The 4th SAR would include the last 90 days of the year.
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#1944504 - 07/23/14 03:00 PM Re: Continuation SAR timeline Confusion pat1010
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Ken, I have read that question... a few times. The problem is the next continuation SAR, it isn't clear.

Question 16 states:
•Identification of suspicious activity and subject: Day 0.
•Deadline for initial SAR filing: Day 30.
•End of 90 day review: Day 120.
•Deadline for continuing activity SAR with subject information: Day 150 (120 days from the date of the initial filing on Day 30).
•If the activity continues, this timeframe will result in three SARs filed over a 12-month period.

The last bullet point agrees with what John stated. But, it is not clear on the dates that the SARs are covering. Are the date ranges of the SARs continuous- 90 days (i.e. days 1-30, 31-120, 121-150, etc.) and the dates of the actual filings continuous- 120 days (i.e. days 30, 150, 270, etc.) If the 2nd scenario is the case, withing a year, you will be filing on dates that are months back.
The scenario below is investigating every 90 days from previous investigation date (no gap in investigation) and the date filed is every 120 from previous date filed.

8/6/2013-11/4/2013 file 11/5/2013
11/5/2013-2/3/2014 file 3/4/2014
2/4/2014-5/5/2014 file 6/4/2014
5/6/2014-8/4/2014 file 10/30/2014 (2 months from date of SAR)
8/5/2014-11/3/2014 file 2/27/2015 (3 months from date of SAR)
11/4/2014-2/5/2015 file 6/27/2015 (4 months from date of SAR)

If continuation SARs were still necessary, that last 3 periods are getting further and further from the dates investigated.

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#1944536 - 07/23/14 03:22 PM Re: Continuation SAR timeline Confusion pat1010
Elwood P. Dowd Offline
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I would send you to the instructions, but the last revision screwed them up. You may need to call the Helpline in order to find peace on this issue. You might start the discussion by asking whether they intend that there be "gaps" in the coverage of a series of continuing SARs. If they say "No," then there is only one way to put the puzzle together.
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#1944678 - 07/23/14 05:43 PM Re: Continuation SAR timeline Confusion pat1010
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I don't see how FinCEN would say "ok" to have gaps in account activity. When we review 90 day activity for continuing SAR filings we stay on that schedule and file by the 120 day, every continuous review. Unless some new suspicious activity occurs during our current review/filing period (days 91 to 120) or we gain additional facts to the case, otherwise we keep our reporting to 90 days activity/file by 120.
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#1945693 - 07/25/14 01:25 PM Re: Continuation SAR timeline Confusion pat1010
Cher Offline
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I share the same confusion, but we make sure that at the 90 day review we actually start from the date of the last review period, so we're really looking back 120 days to avoid gaps. I really don't think there is any "rule" that says we have to only report 90 days of activity on the followup SAR, we report whatever we see since the last review date. If you're still unsure just close out the customer smile - that's solves the problem right there and is my preferred choice of action anyway - though management usually disagrees.

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#1947365 - 07/30/14 05:28 PM Re: Continuation SAR timeline Confusion pat1010
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To the original poster:

You're suffering from analysis paralysis. I feel your pain.

Take a step back.

The purpose of reporting continuing activity is to ensure that all transactions in a pattern of suspicious activity are reported. Follow the spirit of the rule.

The problem with FinCEN's FAQ is that it assumes that all institutions wait until the due date to file a SAR. Most don't, so disregard what they say. Here's what you need to effectively track continuing SARs:

1. Filing dates.
2. Review period dates.

When you file your initial SAR, you should track the date scope of the investigation, either in internal documents or the narrative itself (I put it there so law enforcement knows it as well). Documenting your review period is crucial, because even in an initial SAR filing, the end date may not equal the filing date.

For a supplemental SAR, your due date is 120 days from the last SAR filing date. The start date of your review should be the date after the end review date of the last SAR. You can file continuing activity SARs as often as you'd like, there's no requirement they include only 90 days of activity. For practical reasons alone, most banks start the review 90 days after the last SAR filing to give themselves ample time to prepare the SAR.

Long story short: Filing deadlines are laregely independent from review period scopes.
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#1948816 - 08/04/14 07:50 PM Re: Continuation SAR timeline Confusion pat1010
pat1010 Offline
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Thanks everyone for thier input!!

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#1948962 - 08/05/14 02:20 PM Re: Continuation SAR timeline Confusion pat1010
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I submitted the following to a FinCEN representative at a level above the Helpline and that person agreed it was correct.

The Bank of Anytown filed a Suspicious Activity Report (SAR). The date range shown on Item 27 was XX/XX/XXXX* to January 15, 2014. The filing date was XX/XX/XXXX.* The activity continues and it is necessary for the bank to file "continuation SARs."

SAR II would cover the 90 day period from January 16 to April 16, 2014. It must be filed within 30 days of April 16; i.e. no later than May 16, 2014.

SAR III would cover the 90 day period from April 17 to July 16, 2014. It must be filed within 30 days of July 16; i.e. no later than August 15, 2014.

SAR IV would cover the 90 day period from July 17 to October 15, 2014. It must be filed within 30 days of October 15; i.e. no later than November 14, 2014.

The periods covered by each SAR do not overlap, nor are there any gaps between them. As "continuing activity report" was checked on SARs II through IV, item 28 would be enabled for each of them and the aggregate dollar amount of all SARs filed to date on the activity would be included there.

* These dates are not relevant to calculations regarding continuing SARs.

This is the "days between dates" calculator I used.
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#1951390 - 08/11/14 11:10 AM Re: Continuation SAR timeline Confusion pat1010
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Ken,

Is it me, or does the FinCEN rep's response seem to contradict Question 16's answer? Unless I've horribly misinterpreted the regs,) and guidance, I was under the impression that continuation SAR the scheduling of continuation SARs was based solely upon SAR filing dates. This answer boldly states that's not the case. I wouldn't trust this response, even if it was given to me by Shasky-Cavelry herself.
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#1951837 - 08/12/14 12:10 PM Re: Continuation SAR timeline Confusion Pat Patriot Act
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Quote:
I wouldn't trust this response, even if it was given to me by Shasky-Cavelry herself.


That's completely up to you...
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#1951838 - 08/12/14 12:10 PM Re: Continuation SAR timeline Confusion pat1010
Kathleen O. Blanchard Offline

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I don't understand what Patsfan is objecting to. It makes sense to me!
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#1952694 - 08/13/14 07:00 PM Re: Continuation SAR timeline Confusion Kathleen O. Blanchard
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Allow me to expand on my concerns.

The FAQ States:

So, for filings where a subject has been identified, the timeline is as follows:
•Identification of suspicious activity and subject: Day 0.
•Deadline for initial SAR filing: Day 30.
•End of 90 day review: Day 120.
•Deadline for continuing activity SAR with subject information: Day 150 (120 days from the date of the initial filing on Day 30).
•If the activity continues, this timeframe will result in three SARs filed over a 12-month period.


The problem with this FAQ is that it is based upon the assumption that every SAR is filed exactly on day 30. In my experience, most folks try to submit the SAR as soon as possible after the decision has been made to file. So what's the deadline for the continuation SAR if you filed on Day 17? Go back to the original guidance, and add 120 - it'd be day 137 since the SAR filing decision was made. What FinCEN should have said is "you can file as little as 3 SARs in a year, if you stagger your filings to go out on each deadline date."

The Bank of Anytown filed a Suspicious Activity Report (SAR). The date range shown on Item 27 was XX/XX/XXXX* to January 15, 2014. The filing date was XX/XX/XXXX.*

* These dates are not relevant to calculations regarding continuing SARs.[/i]

How could FinCEN agree that this was irrelevant when their own guidance and FAQ both state [i]Financial institutions with SAR requirements may file SARs for continuing activity after a 90 day review with the filing deadline being 120 days after the date of the previously related SAR filing.[/i]

Here's my interpretation of how the schedule is supposed to work, which [i]would
result in only three filings if followed:

Milestone Day Example Date
Initial SAR Decision Day 0 1/1/2014
First SAR Filing Date Day 30 1/31/2014
First 90-Day Review Day 120 5/1/2014
Second SAR Filing Day 150 5/31/2014
Second 90-Day Review Day 240 8/29/2014
Third SAR Filing Day 270 9/28/2014
Fourth 90-Day Review Day 360 12/27/2014
Fourth SAR Filing Day 390 1/26/2015

With each SAR filing, the review period is not dictated other than it must include at least 90 days. To be in line with the "spirit" of continuation SAR filing, try to keep it as recent as logistically possible. There's no [need to cut off at 90 days from the last filing, but it could be easier to manage in most circumstances if you do.

The issue I had with Ken's example is that, if followed, you're back to filing every 90 days and five SARs in a 12-month period! FinCEN wanted to reduce it down to as little as three by allowing you to file every 120.
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#1952798 - 08/13/14 08:48 PM Re: Continuation SAR timeline Confusion pat1010
John Burnett Offline
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Clearly, our friends at FinCEN have not been able to come up with and share with all of their personnel a single response to this complicated question. When an agency has to disavow its own instructions (on the E-filing site) for continuation SARs because someone put the old (wrong) instructions up for the e-filing SAR version and then can't respond to a well-crafted question by someone who's a little bit more versed in these rules than the average bear with anything approaching consistency with the guidance that FinCEN had said was correct (from the FFIEC Manual), there's something very wrong. This is too important for multiple versions of the "correct" guidance.
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#1952872 - 08/13/14 11:08 PM Re: Continuation SAR timeline Confusion Pat Patriot Act
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Quote:
The issue I had with Ken's example is that, if followed, you're back to filing every 90 days...


You need to read it again. The time period covered by the SAR is 90 days. You have 30 days after the end date to file it.

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#1952890 - 08/14/14 03:42 AM Re: Continuation SAR timeline Confusion Elwood P. Dowd
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With all due respect, I completely understood your statement, but disagree with it. My concern is that FinCEN's unwritten and unquoted agreement with your example is that it contradicts their written instructions. A 90-Day review is named as such because it begins 90 days after the filing of the last SAR, not because it only includes 90 days of activity.

I've modified your example to illustrate FinCEN's written instructions:

The Bank of Anytown filed a Suspicious Activity Report (SAR). The date range shown on Item 27 was January 1, 2014 to January 15, 2014. The filing date was January 16, 2014.* The activity continues and it is necessary for the bank to file "continuation SARs."

SAR II would cover from the end of the last filing up until, at a minimum, April 16, 2014. It must be filed within 120 days of January 16; i.e. no later than May 16, 2014. If the institution so decides, they can include on their report any suspicious activity that occurs before the SAR filing on May 16, 2014 (i.e. there is no need to stop review at 90-days).

SAR III would cover from the end of the last filing up until, at a minimum, August 14, 2014. It must be filed within 120 days of the last filing date, May 16, 2014; i.e. no later than September 13, 2014.

SAR IV would cover the period from the end of the last filing up until, at a minimum, December 12, 2014. It must be filed within 120 days of the last filing date, September 13,2014; i.e. no later than January 11, 2015.


*Per FinCEN, continuation SARs schedules are calculated by adding 120 days to the previous SAR filing date. ("Financial institutions with SAR requirements may file SARs for continuing activity after a 90-day review with the filing deadline being 120 days after the date of the previously related SAR filing" - SAR Activity Review - Trends, Tips, & Issues, P. 53)


You file each continuing SAR 120 days after the last one was filed. No gaps, no overlaps. It's that simple.
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#1952891 - 08/14/14 09:16 AM Re: Continuation SAR timeline Confusion Pat Patriot Act
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We're beyond the point of diminishing returns here so I'll leave you with this: I acknowledge, the method I spelled out does not reflect a regurgitation of FinCEN's instructions.

However, that method also:

* does not "violate" any reading of those instructions,
* avoids any gaps or overlaps in coverage, and
* yields predictable results 100% of the time.

If you or others feel that "It's that simple" I will not make any further attempts to interfere with the process of natural selection.
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#1952893 - 08/14/14 10:19 AM Re: Continuation SAR timeline Confusion Elwood P. Dowd
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There's no reason to resort to insult, what I've described is completely acceptable by FinCEN. Your "natural selection" comment suggests that following such a schedule would result in adverse consequences. How? Where in any regulation or guidance does it state that the schedule outlined in my previous post is unacceptable? If anything, the "natural selection" would occur to the organization whose resources are strained from the cumulative effect of filing too many continuation SARs.
Last edited by patsfan; 08/14/14 10:20 AM.
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#1953053 - 08/14/14 04:34 PM Re: Continuation SAR timeline Confusion pat1010
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OK - kids - let's play nice in the sand box (boy, I can't believe I am the one saying that smile )

1. There is absolutely nothing wrong with handling SARs in the manner put forth by Ken. In fact, from a SAR management standpoint, it is a lot easier then worrying about differences in the filing dates and review dates. I have seen a bank or two really get this screwed up (well, actually quite a few more than two).

2. The cumulative guidance from FinCEN is all over the board and however you choose to interpret it may or may not be the way your specific regulator might (regardless of what FinCEN has said or may mean). FinCEN will not intervene in an examination.

3. All one has to do is read the electronic filing guidance to realize that they speak out of both sides of their mouth when describing what a 90-day review period means: "Continuing reports should be filed at least every 90 days until the suspicious activity ceases. Continuing reports must be completed in their entirety, including the information about all subjects involved in the suspicious activity and all financial institutions where the activity occurred. The continuing report Part V narrative should include all details of the suspicious activity for the 90-day period encompassed by the report, and only such data from prior reports as is necessary to understand the activity. Do not reproduce the narratives from prior reports in the continuing report. Provide both the dollar amount involved in the suspicious activity for the 90-day period in Item 26 and the cumulative dollar amount for the current and all prior related reports in Item 28."

So lets go back to our prospective corners and call it a draw.
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#1953168 - 08/14/14 06:44 PM Re: Continuation SAR timeline Confusion rlcarey
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Originally Posted By: rlcarey
OK - kids - let's play nice in the sand box (boy, I can't believe I am the one saying that smile )

1. There is absolutely nothing wrong with handling SARs in the manner put forth by Ken. In fact, from a SAR management standpoint, it is a lot easier then worrying about differences in the filing dates and review dates. I have seen a bank or two really get this screwed up (well, actually quite a few more than two).

2. The cumulative guidance from FinCEN is all over the board and however you choose to interpret it may or may not be the way your specific regulator might (regardless of what FinCEN has said or may mean). FinCEN will not intervene in an examination.

3. All one has to do is read the electronic filing guidance to realize that they speak out of both sides of their mouth when describing what a 90-day review period means: "Continuing reports should be filed at least every 90 days until the suspicious activity ceases. Continuing reports must be completed in their entirety, including the information about all subjects involved in the suspicious activity and all financial institutions where the activity occurred. The continuing report Part V narrative should include all details of the suspicious activity for the 90-day period encompassed by the report, and only such data from prior reports as is necessary to understand the activity. Do not reproduce the narratives from prior reports in the continuing report. Provide both the dollar amount involved in the suspicious activity for the 90-day period in Item 26 and the cumulative dollar amount for the current and all prior related reports in Item 28."

So lets go back to our prospective corners and call it a draw.


Now hold on just a sec, ref, we need more judges on the decision. This isn't about me vs. Ken either. It's about scheduling continuing SAR filing deadlines on the SAR filing date vs. scheduling continuing SAR filing deadlines on based upon the end date for Item 27.

My point is that I've never seen any guidance specifically state that you base your review scheduling deadline on anything other than the date of the last SAR filing.

FinCEN released those instructions on 12/13/13. Their website's SAR filing FAQ today, states "deadline being 120 days after the date of the previously related SAR filing."
When a regulatory agency corrects themselves, it's prudent to rely upon their clarification rather than their previous inaccurate statement. We seem to be arguing over the definition of "date of the previously related SAR filing."

Now, I acknowledge it's just opinion, but in my experience with SAR filing and QC'ing; the easiest way to manage the process is to track the date range of suspicious activity and the scope of your review, and schedule your "90-Day Review" from the date of the SAR filing. I'll give a more realistic example to demonstrate how it's more effective:

Bank A files a SAR based upon a "takeback" of a $12,000 cash deposit which happened on Saturday, January 4, 2014. Since Bank A's AML Department is not a 7 day shop, they don't receive the report until Monday, January 6, 2014. They go their routine investigation process and decide to file that day. Due to resource constraints, Bank A does not end up filing the SAR until the 30-day deadline on February 5, 2014. Before submitting, they review everything that happened up until February 4, 2014, note no additional suspicious activity, and enter January 4, 2014 for both values in Item 27 on the SAR.

For the sake of the example, let's say the customer starts going to town with structuring after you file.

Now using Ken's approach, you would have to review this again on 4/4/2014 with a deadline of 5/4/2014. And although it is not reflected on any form fields, you would end up duplicating your efforts by re-reviewing the period from 1/4/2014 to 2/4/2014. The end result is that you re-do work and file a month earlier than needed.

Using FinCEN's FAQ approach, along with internally recording your investigation scopes, you can save more time. In the example, you would begin the review on 5/6/2014, use the scope of 2/5/2014 to 5/5/2014 (at a minimum), and file by 6/5/2014. The end result is that you have no redundant investigations and you file only as often as needed. All you need to do to make that approach work is write down the scope of your investigation (which should be done anyway). If your clients can't get that right, then they probably can't get much right.

Last edited by patsfan; 08/14/14 06:47 PM.
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#1953181 - 08/14/14 07:09 PM Re: Continuation SAR timeline Confusion pat1010
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If your clients can't get that right, then they probably can't get much right.


Now who is being rude??? I think this thread has pretty much run its course.
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