The bank.... by mistake... deposited another customer's cash into the wrong account and didn't discover it until two months later.
The person to whose account the cash was deposited, spent all the money over the two month period. This person is very low income (retired on a fixed income-SSI) and we feel there is very little chance that he could afford to pay it back...

Management is asking us to file a SAR on this person.
What grounds would we have?

I hesitate to think that this is suspicious activity. It's wrong, yes, but it's our fault in the first place. The customer "claims" he didn't know that the money was not his because during the same week of the misplaced deposit the customer deposited his 401K... Which is true and was nearly the same $$ as the deposit. He claims he never looks at his bank statements. That's not good... but, my 75 year old mother doesn't either.
He claims that he just spends his money until he runs out. This appears to be true also based on his NSF history.

The branch manager tends to believe him.
Any thoughts?

IMHO, this does not sound like an event worthy of a SAR.

I agree with BrendaC!

But I would certianly ask them to move their business elsewhere.

This is an unfortunate situation; however, taking money that does not belong to you is still a crime. The fact that the bank made the mistake does not mean the customer has a right to take the money. If it meets the SAR threshold amount, I would file a SAR.

I agree with Retread about the SAR filing and would also try to work out a repayment plan with the customer.

How much money are we talking about?

I don't think a SAR should be filed.

Update.
Yesterday he admitted that he knew the money was not his but didn't want to ask the bank about it just incase it was a "hidden blessing".
I suppose that sometime we may be tempted just to see how we react. His reaction was dishonest.

To answer "(not as) NEWBSA:
"How much money are we talking about?"

$13,000+

Our attorney says 18 USC 2113(b)"Bank robbery and incidental crimes" would be the statue violated.

http://www.foxnews.com/story/0,2933,479901,00.html

Very timely story - in PA the crime is felony theft, receiving stolen property and criminal conspiracy to commit theft.

If he admitted he knew the money wasn't his, I think that puts a different angle on the situation. Hopefully, he didn't spend it all and understands he will need to pay the money back.

We had something similar one time involving a guy that went out and purchased electronics (TVs, surround sound, you name it). He was able to return many of the items and then signed a loan for the remainder of the funds.

Begrudgingly, I agree the SAR is necessary; the law is not "finders keepers." It is this quote that chafes:



There have been very few SAR related threads where management is the proponent for filing a SAR. If they believe the customer stole from them they should be more worried about filing a police report or a civil suit than a SAR.

"Oh yeah, there might be a newspaper article that makes us look sloppy and guilty of carrying out a vendetta against a retiree with limited means, right? Okay, then let's just accuse him of stealing in such a way that no one will never know about it."

Phhttt!