Have the following scenario and need help to determine if a SAR should be filed.

Customer sold cattle to a sale barn. Sale Barn issued a check payable to customer and customer came to bank and purchased a money order payable to himself. The check that was used to purchase the money order was processed normally. The customer ask bank to hold money order for him and he would pick check back up. Told bank if something happened to him to apply money from money order to pay on his loans. It should be noted the date was toward the end of year. Customer did pay taxes on money when it was reported as income but I believe it was delayed to the following year. Should a SAR be filed

If I understand the situation correctly, an existing customer obtained funds from a legitimate sale (verified?) of property. The funds were then used to purchase a Money Order. You have reason to believe that the customer paid the appropriate taxes.

The circumstances are somewhat unusual, but I don't think an SAR is warranted in this case.

That said I don't really like "if something happened to him to apply money from money order to pay on his loans." That might warrant a follow up call or alerting law enforcement.

"The customer ask bank to hold money order for him and he would pick check back up. "

I also have to ask why a bank would agree to do such a thing??

Randy, that's where I was going with that. It should NEVER be held, physically, if that is what is meant. It should either leave the building with him or be deposited into an account.

I agree with that. I ask the officer why he kept the checks and the he said the customer gave it to him. I told him he should not have accepted it and if he did he should have told him he was going to deposit it into his checking account. He said he would not do it again. The examiners want him to file a SAR. I told him to file one due to the fact the examiners ask him to. I do not think this warrants a filing but because the examiners want him to I would. It is a very unusual situation. I also said if something happen to the customer and he applied the checks to the loans, his family may have a problem with that.

Please do not take this the wrong way but why would you file a SAR just because an examiner (auditor)want you to.


FWIW I am in audit.

This is the only crime I see, if it is one at all. He used the money order to defer the income to the following year, thereby defering the payment of taxes for one year. It may be tax evasion, but is it SAR worthy? The dollar amount of the crime, which I guess would be only the amount of the tax, probably isn't enough to file on, is it? And I guess you're checking the "other" box?

We also do not know when the fiscal year ends, the taxes may be due in the next year as well.

Why file a SAR because the examiner told you?

I do not think there are many if any BSA Officers who would not file the SAR after being told to do so by an examiner if the failure to file is going to be a issue in the exam report.

As someone who once was cited by an examiner and fought the finding (I did win but it required the Presidednt of the Bank to visit the regional office), all I can say, is if it happened again, I would just file the SAR.

As an FYI – If the bank refuses to file, my understaning is that the examiner can file on their own, and they may not make the SAR sound as good as you can.


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Just my opinion for what it is worth