Our examiners want us to investigate all subpoenas, etc... from law enforcement to decide if our bank needs to file a SAR. If the law enforcement request states that the customer is a victim of ... fraud and that is the reason for the request, does the bank need to do a SAR for this? The government is already aware of the situation. The customer was the one who initiated the investigation on behalf of themself. It seems to be redundant.

You should examine the activity on your customer's account and file a SAR if your investigation determines that there is suspcious activity on the account. If you do not find any suspcious activity, document your research, findings, and decision not to file.

The fraud is actually on the account, however the victim is our customer.

Like BrianC mentioned, you should ONLY file if there is a suspicious activity on the account. A third party's (including LE) opinion or motives should not influence your decision in making the determination to file a SAR. However, if the suspicious activity is on the account, it is appropriate to do the usual filing and disclosing in the narrative that the LE is currently investigating.

If you find activity that is indicative of what was going on, actual suspicious activity in the account, consider what you could do to identify such unusual activity in the future in other accounts...new queries to run, new rules to establish in AML software, for example.

Ok, I think I'm reading this wrong. Customer tells you there is some type of fraud on there account? The bank investigates this claim and has reason to believe that the fraud did occur?

If you believe fraud has occurred (after reviewing all of the customer information available) and it's over the filing threshold, a SAR would be required. LE's involvement really doesn't change anything.

We received a subpoena from LE indicating they were investigating ...fraud in one of our customer's account. The customer called the LE themselves, never told us about it. It is not blatant fraud, therefore there would be no way the bank could pinpoint this type of fraud unless the customer tells us. So by just looking at the account, it does not appear to be suspicious. The only reason we know about this is due to the subpoena itself. So if I was looking at this account without knowing about the subpoena, I would not see anything suspicious. So by LE telling us, I checked the account and see what they are investigating.

So does this mean I need to file a SAR on this account? The victim is our customer. So the suspect of the SAR would have to be the other individual in which we do not have all the information for.
I'm thoroughly confused now. As I said before it seems to be redundant since the LE is investigating it already per the customers request.

LE already investigating is NOT an out for filing a SAR. This is how banks get fined & shut down.


Since you were given knowledge, if during your own research you discover suspicious activity, you must file. Since you can identify the suspect by name, your threshold to file is $5,000.


One of the few situations where I don't find suspicious activity is some Embezzlement cases. It can be nearly impossible to determine someone is skimming funds from the company, especially if the company gives them full access to the accounts (unless they're writing a ton of checks to themselves, but the "good" embezzlers are usually a little more sneakier than that)

Forget that LE is investigating and that anything is redundant.

It is standard practice to review accounts when a subpoena is received...has been a BSA practice for several years now.

If you review the account and related accounts and see things that could have been a tip off, file an SAR.

If you review the account and related accounts and do not see any suspicious activity there is no requirement to file an SAR.

However, some banks do file - at urging of regulator or their own choice - and report the transactions they now know were part of the apparent fraud.

If you do file you mention that law enforcement is investigating.

Do a search in the BSA forum on subpoena and you will numerous discussions on this topic.

Thanks so much for all your help. I am not new to BSA, been doing this for 10 years now but this IS the first time where the customer went to LE before they went to the bank on this type of activity.

I'm on board with this. Notasnew got my point across better than I did. If at the end of the day, you think the activity could be suspicious and related to fraud, file the SAR. If not, don't file. Either way make sure to document your reasons for filing/not filing.