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#349669 - 04/21/05 04:17 PM
SAR Question
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Diamond Poster
Joined: Jun 2002
Posts: 1,044
The banana bin
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We received information about a shared customer from another institution. The information was given to give as a 'heads up' to a potential fraud situation. If we were to monitor the account as we would for any other customer, I don't know if we have enough to trigger a SAR. With the information is a different matter entirely. Opinions?
I know that we *shouldn't* have been given the information so informally but we are both on the 314(b) lists and this could be a potential money laundering situation.
Advice on how to proceed?
_________________________
My opinions are definately my own. I could be wrong. But I don't think so.
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#349671 - 04/21/05 07:24 PM
Re: SAR Question
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10K Club
Joined: Oct 2000
Posts: 40,086
Cape Cod
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My read of 31 CFR 103.110 (which implements 314(b)) is that it only covers interbank sharing of information relating to suspected money laundering or terrorist activity. It doesn't expand to include "fraud" unless the "fraud" involves ML or terrorism.
That said, banks have for years participated in anti-fraud networks. And I don't believe they do so illegally.
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John S. Burnett BankersOnline.com Fighting for Compliance since 1976 Bankers' Threads User #8
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#349676 - 04/25/05 04:27 PM
Re: SAR Question
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Diamond Poster
Joined: Jun 2002
Posts: 1,044
The banana bin
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I've been doing some digging this morning and it got the brain wheels turning. (I hate it when they do that! haha)
If I understand correctly: Banker from X Bank calls me and gives information that involves a current customer. It doesn't fall under the 314(b) category...it's just information. I do a review, see nothing. No SAR is warranted.
But if I do a review and see that the activity that we now have supports the information we can file a SAR because knowing all that we know it's suspicious. Right?
So, what if the banker never called, and we're looking at the account by itself and say, "Yeah, it's odd but doesn't fit the SAR requirements?"
Am I babbling or am I making sense? I guess we shouldn't play 'what if'. This is what we know right now and it ain't pretty. Here's who told us the information. It's not our fault that he blabbed but it helped us spot something suspicious.
Is that our stance?
Sorry for all the questions, but I'm still relatively new and since we're small, we don't get this stuff often.
To quote the old Bartles and James commericials, "I thank you for your support." (Is it too early to think about drinkin'?)
_________________________
My opinions are definately my own. I could be wrong. But I don't think so.
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#349678 - 04/25/05 04:45 PM
Re: SAR Question
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Diamond Poster
Joined: Jun 2002
Posts: 1,044
The banana bin
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I've heard about this private forum but have yet to see it. I feel a little left out. haha. And yes, I would feel better putting it there.
_________________________
My opinions are definately my own. I could be wrong. But I don't think so.
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#349680 - 04/25/05 04:55 PM
Re: SAR Question
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Platinum Poster
Joined: May 2004
Posts: 833
Michigan
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Amy,
Don't overthink this one. When someone tells you something it's not your fault that they told you. If it leads you to something suspicious, file the SAR.
If a customer walked into your office and told you one of your other customers was a crook you would investigate and, if you found anything, you would file.
It's not you fault so stop beating yourself up about it.
_________________________
If you approach life with pure logic you can avoid almost all of the fun.
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#349683 - 04/25/05 05:15 PM
Re: SAR Question
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Power Poster
Joined: Nov 2001
Posts: 6,719
PA
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Quote:
But if I do a review and see that the activity that we now have supports the information we can file a SAR because knowing all that we know it's suspicious. Right? ... I guess we shouldn't play 'what if'. This is what we know right now and it ain't pretty. Here's who told us the information. It's not our fault that he blabbed but it helped us spot something suspicious.
Without knowing the specifics, it's difficult to say if an actual privacy breach occurred. But, with the situation being as unpretty as it is, I would guess the subject would have a difficult time playing the privacy card (especially considering the confidential nature of SARs). Whether information was passed along 'to prevent fraud', or whether it falls under 314(b), I'd be willing to bet that enough information was shared within the letter and spirit of the law to legitimize the contact.
Plus, any liability for a privacy breach would fall on the other bank. Although I'm sure you don't want the other bank to face any repercussions, it's a risk that you have to take at this point. Like Ken said, it's not likely that anybody would face any criticism for sharing information (unless it was done maliciously). So it is a small risk in comparison to the much larger risk of failing to file a SAR.
Quote:
So, what if the banker never called, and we're looking at the account by itself and say, "Yeah, it's odd but doesn't fit the SAR requirements?"
It's not unusual for activity to not appear suspicious until external knowledge is added to what you can see bankside. For example: Individual purchases a $5000 check, payable to the local court, and paid for with $100 bills. In and of itself, that does not rise to SAR levels. But add the news article from the prior week, indicating that this individual was arrested and charged in a fairly large drug bust, and it becomes quite SARable.
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#349684 - 04/25/05 06:27 PM
Re: SAR Question
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Diamond Poster
Joined: Jun 2002
Posts: 1,044
The banana bin
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Thanks again. I agree with everything that is being said. In fact, a lot of it is my argument to the opposing person at my bank. I just want to be able to defend my opinion and am playing devil's advocate.
I'm still a little green so I can understand going through the wringer in order to support my opinions.
Thanks again!
_________________________
My opinions are definately my own. I could be wrong. But I don't think so.
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