Travel Industry: SAR Analysis -- Indications of Suspicious Activity
The SAR database was searched for terms such as "travel" and "tour" to identify SARs where the suspects were listed as travel agents or travel agencies. The queries returned 5,406 unique SARs. A sample of 1,081 SARs was selected at random and reviewed, identifying 995 suspects as travel agents or travel agencies. The most frequently reported activity was structuring of currency deposits. Other frequently reported activities were deposits of large amounts of currency, structured currency withdrawals, electronic transfer of funds from the suspect's account, check fraud, and suspicious currency deposits. The following are summaries of these types of activities.
The most frequently reported suspicious activity involved structured deposits.
- The majority of the reports described either sequential daily transactions near the reporting threshold, or frequent deposits in amounts between $9,500 and $10,000.
- Also reported were multiple same-day deposits at different branches and same-day deposits at the same branch. Each of the deposits was well under the reportable level but daily total deposits exceeded $10,000. The SAR filer often noted that the bank had reported the transactions by filing a currency transaction report (CTR) for the same-day deposits.
Structured currency withdrawals were also reported.
- Frequent withdrawals of currency in amounts at or just below $10,000 were typically conducted by cashing checks written on the customer's account.
- Some reports indicated the withdrawal of a specified amount of currency. For example, one report described the withdrawal of $29,000 over three days where each transaction fell below the reporting limit. The report noted that the original funds were provided through an incoming wire from East Asia.
- Other reports showed same-day withdrawals in excess of $10,000 that were structured among different tellers, different branches, and ATMs so that no single transaction exceeded the reportable amount.
Suspicious currency deposits were identified.
- Currency deposits by travel agencies were reported as suspicious because the aggregate amounts were considered excessive for the filer. Such SARs described a series of deposits over a short period of time that totaled to a "large" amount.
- Other SARs described ongoing deposits that were considered not commensurate with the business of the customer.
- In some instances, the filer simply listed a travel agency's currency deposit transactions without any comment as to why such activity was deemed suspicious on the SAR.
Outgoing wire transfers were sent from travel agencies' accounts.
- Other wire transactions were apparently deemed suspicious because of the amounts involved. For example, one bank reported two domestic wire transfers that totaled $200,000.
- " Structured" outgoing wires were also reported. Those included small dollar wires from different persons to a single beneficiary, or multiple small-dollar wires from the same person. For example, an MSB reported several remittance agents for numerous small wire transfers to Colombia. (The MSB has a special identification rule for transfers to Colombia that exceed $1,000.)
Check fraud was another reported violation involving the travel industry.
- The most commonly reported violation was check fraud by persons identified as travel agents withdrawing funds against worthless checks. In those cases, the travel agent deposited checks he knew were worthless and the bank honored withdrawals against those "uncollected" funds.
- Other common check fraud violations noted were the withdrawal of funds against checks with forged endorsements or maker's signatures, and counterfeit checks.
- The cashing of "credit card checks" for accounts that had been closed was also reported.
Excerpted from SAR Activity Review Issue 5, page 25
First published on 02/01/2003