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#2002306 - 03/18/15 02:35 PM Reason for SAR filing?
New Manager Offline
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Joined: Jan 2004
Posts: 136
We're filing a SAR on a nail salon because their cash deposits are out of pattern; however, I'm wondering if we can use a second reason.

Salon owners came to the branch to set up direct deposit (not sure from where). They want the funds to go to the business account and then they will transfer them to a personal account. The issue is the branch has knowledge that they sold the business. When questioned, the owners admitted it. Branch person asked why they wanted to set up direct deposit. The response was "They don't know we sold it." "They" is wherever the direct deposit would come from. The branch person turned them away, owners became angry and then left.

What reason would this fall under? Seems like fraud to me, but would another category be a better fit?

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#2002307 - 03/18/15 02:38 PM Re: Reason for SAR filing? New Manager
Dani York, CRCM Offline
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Dani York, CRCM
Joined: Apr 2005
Posts: 3,663
TN
Transaction with no apparent legal or business purpose??
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#2002324 - 03/18/15 03:19 PM Re: Reason for SAR filing? New Manager
PrimeTime Offline
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PrimeTime
Joined: Nov 2014
Posts: 173
I might be misunderstanding here, but why would a nail salon be receiving a direct deposit from anything other than an ATM or merchant service debit/credit processor?

I'm also confused as to why direct deposit INTO the account would be set up at your branch, isn't that an issue that they would take up with the other FI?

I'd say that's transaction with no apparent legal or business purpose regardless of my confusion.
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#2002336 - 03/18/15 03:41 PM Re: Reason for SAR filing? New Manager
New Manager Offline
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Joined: Jan 2004
Posts: 136
Thanks. I don't understand that either, but nonetheless the former owners came in to set up direct deposit INTO the account. Bizarre.

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#2002360 - 03/18/15 04:06 PM Re: Reason for SAR filing? New Manager
JacF Offline

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Joined: Nov 2001
Posts: 6,719
PA
Could be fraud, if the sender is sending the funds because they've been led to believe the business is still being operated by the previous owner.

You probably already have this on your radar, but I also suggest closing the account ASAP.

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#2002407 - 03/18/15 05:30 PM Re: Reason for SAR filing? New Manager
Elwood P. Dowd Offline
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Elwood P. Dowd
Joined: Aug 2001
Posts: 21,939
Next to Harvey
If "out of pattern," means grossly excessive, consider this possibility. The correlation between these two activities is pretty strong; you can find other articles just like this one.
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#2002428 - 03/18/15 05:56 PM Re: Reason for SAR filing? New Manager
New Manager Offline
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Joined: Jan 2004
Posts: 136
Thanks, Ken.

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