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#1990292 - 01/22/15 02:11 PM What's in your narrative?
BSAkpo Offline
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BSAkpo
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Good morning everyone,

I was hoping to get feedback from you regarding your SAR narratives. I was always told to write the customer’s activity for the timeframe that I reviewed and specify what I thought was unusual (to show that I actually reviewed the account). An old colleague of mine (and his BSA Officer) would only write about the unusual activity. The auditors/examiners didn’t have a problem with it. I’ve gotten praises on my narratives by examiners, but now I'm second guessing myself if am I doing too much? I was just wondering if you all just write about the possible suspicious activity and leave out the “normal” transactions. Any feedback is appreciated.
Thanks!

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#1990310 - 01/22/15 02:58 PM Re: What's in your narrative? BSAkpo
MagicCity Offline

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I first say who the customer is.
What type of review was performed that detected the suspicious activity.
What the suspicious activity is.
Why the SAR is being filed.
Our contact info.
List of supporting documentation.

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#1990314 - 01/22/15 03:01 PM Re: What's in your narrative? BSAkpo
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#1990345 - 01/22/15 03:59 PM Re: What's in your narrative? BSAkpo
BSAkpo Offline
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Thank you for your responses.

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#1990734 - 01/23/15 07:08 PM Re: What's in your narrative? BSAkpo
Elwood P. Dowd Offline
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There is an article beginning on page 38 of Issue 22 of the SAR Activity Review that is based on the FinCEN SAR rather than the legacy SAR.

Their sample narratives regurgitate a great deal of the information your bank already supplied in the text box portion of the report. It's simply unnecessary and makes them incredibly difficult to read. Yes, that's my opinion, but it's also held by a number of law enforcement people.

Just tell them a story. Reference the sources of the information in the documentation you list at the end of the narrative section. If law enforcement is interested, they will pick up the supporting documentation and find all the minutiae they need. Your job is to get them interested and convince them that the evidence they will need is contained in your supporting documentation.
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#1990752 - 01/23/15 07:35 PM Re: What's in your narrative? BSAkpo
Princess Romeo Offline

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I agree - I think so many SARs have these detailed narratives with dates and amounts of deposits and account numbers that go on and on like the proverbial Shaggy Dog Story but with no real point.

NO ONE wants to slog through that - except, unfortunately, for examiners who still want to see all of that in there.

While I understand the importance of dates, and amounts and account numbers, sometimes cramming all of that in can obscure the overall picture - or forest for the trees syndrome.

My preference is to have the first paragraph state what we suspect is going on in clear language. The body can have the minutia, and the last paragraph sums it up.
Last edited by Princess Romeo; 01/23/15 07:44 PM.
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#1990759 - 01/23/15 07:43 PM Re: What's in your narrative? BSAkpo
rlcarey Online
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Detailed transaction information - That's what the spreadsheet attachment is for.
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#1990821 - 01/23/15 09:23 PM Re: What's in your narrative? BSAkpo
NotDoneYet Offline
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And thank goodness for that option, rlcarey.

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#1990843 - 01/23/15 10:00 PM Re: What's in your narrative? BSAkpo
Flash Friday Offline
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I include a summary of historical activity when reporting behavior changes that could be suspicious when compared to that activity. For example, "in a 6 month account review the customer's activity was typical for an account held for household purposes with payroll credits and debits for household expences until"...then describe what's unusual. With more detail of historical volumes when appropriate.

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#2046513 - 10/27/15 08:12 PM Re: What's in your narrative? BSAkpo
MassCompliance4 Offline
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Reviving this thread regarding what to include in a narrative - one of my business lines with SAR filing responsibilities has indicated that when they file a Continued Activity SAR (CAS), they purposefully do not include all of the 5 W's (Who, What, When, Where and Why) as all of that information is contained in the original "Initial" SAR. They only provide the Who, When and sometimes the What for the newly identified "continuing activity".

So for instance on a loan fraud ring, they will include the information about the new applicants and loan amounts, but they do not go into any explanation of "what it is about these new loan applications that is fraudulent" because they have already stated in the Initial SAR why it is loan fraud and this CAS filing just identifies the new fraudsters.

This seems like such a basic question that I feel odd even asking but in none of the FinCEN guidance regarding how to craft a proper narrative can I find where narratives created for a Continued Activity SAR are treated differently or should contain fewer elements than narratives created for an initial SAR. I would like to assume that means something: All Narratives Are Created Equal. And should ALL contain the same elements. Even though the actual information is different and you should NOT include the same information from the original SAR, you should include the new information regarding all of the 5 W's in every CAS narrative you file?

What say you all?

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#2046529 - 10/27/15 08:37 PM Re: What's in your narrative? MassCompliance4
Elwood P. Dowd Offline
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From page 84 of the instructions:

4. Continuing Reports: A continuing report should be filed on suspicious activity that continues after an initial FinCEN SAR is filed. Continuing reports should be filed at least every 90 days until the suspicious activity ceases. Continuing reports must be completed in their entirety, including the information about all subjects involved in the suspicious activity and all financial institutions where the activity occurred. The continuing report Part V narrative should include all details of the suspicious activity for the 90-day period encompassed by the report, and only such data from prior reports as is necessary to understand the activity. Do not reproduce the narratives from prior reports in the continuing report. Provide both the dollar amount involved in the suspicious activity for the 90-day period in Item 26 and the cumulative dollar amount for the current and all prior related reports in Item 28. If continuing losses are involved for any financial institution recorded in Part III, record the 90-day loss in Item 63 and the cumulative loss in Part V.

It's like watching Pretty Little Liars, you can't just show your readers this episode (chapter) and expect them to have any idea what's going on. Every SAR you file has to tell a complete story.
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#2046610 - 10/28/15 02:06 PM Re: What's in your narrative? BSAkpo
thomasj Offline
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When I file an initial SAR, I tend to keep the core information (information that likely will not change) about the subjects and the situation in a few sentences (the hook if you will, similar to a song) unto itself so that if a follow up is required, I can literally cut and paste this core information into the next SAR. From there I update the core information (if necessary), the activity that occurred over the past 90 days, update any narrative on the aggregate totals, and any new additional information I may have. In my experience, a series of SARs may only pique the interest of investigators when the aggregate totals hit a certain level, if they are looking at just the 3rd or 4th report in the series, I want them to have the full back story to avoid them having to go back and read through the previous reports (which they may or may not take time to do).

I hesitate to say "cut and paste" because I don't want to give the impression that I'm just pasting a narrative from the previous SAR and adding to it, that's not what they want and not what I mean when I say that. There is however some basic core information that should be on the original and all follow up reports.
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#2046712 - 10/28/15 05:57 PM Re: What's in your narrative? BSAkpo
MassCompliance4 Offline
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Gentlemen - thank you so much for your time and insight. You have confirmed what I believed to be true and I shall now pass along the wisdom and guidance.

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#2119521 - 02/24/17 09:02 PM Re: What's in your narrative? BSAkpo
Always In Training Offline
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Can I revive this thread?

Is the state of the industry still, law enforcement wants a summary, and regulators what super-detailed narratives? I can't be the only one having this disconnect, can I?

I'm been given feedback several times that there should be nothing in my blanks or attachments that doesn't appear in the narrative both by my federal and state regulator and auditor -- but I'm afraid reading every detail about every XYZ in detail (so that my number in part 2 #26 can be balanced back to my narrative). The regulators & auditors state that law enforcement doesn't want to request our backup documentation and they don't look at the spreadsheets. My current report is an easy peasy check kiting report -- but I've got a detailed issue I've got to write up soon, and I don't want to bog down the narrative with ATM addresses and timestamps.

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#2119553 - 02/24/17 10:23 PM Re: What's in your narrative? BSAkpo
EB, CAMS Offline
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We have been advised and complimented on this format:

Summary paragraph---tell the whole story, include subject, date ranges, keyword activity and dollar amounts.

Use subsequent paragraph(s) to give more detailed information to support paragraph 1. If you use a spreadsheet, reference that in the narrative. For something like kiting we would say (X) number of transactions from this date to that date, at the following location(s) for a total $ amt. Additional detail in the spreadsheet.

If your narrative is organized and informative and it has information that law enforcement is looking for, they will call and ask for the supporting documentation. For an auditor or examiner to suggest otherwise is incorrect. The reality is that most of what banks report in SARs is simply not what law enforcement maybe looking for at that time. If you know or suspect it is something really worthwhile, contact your local LE and report the information directly as well.

Over the years, we've fostered relationships with the SAR committee reviewers for our region and they have been instrumental in getting SAR data to the right SAR committee if it is outside our region. But we had to network and report too.
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#2119970 - 03/01/17 10:44 AM Re: What's in your narrative? Always In Training
Elwood P. Dowd Offline
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Quote:
The regulators & auditors state that law enforcement doesn't want to request our backup documentation and they don't look at the spreadsheets.


That's so ignorant... All your SAR does is tell a story. The supporting documentation proves the story is true. Law enforcement will request your supporting documentation when they need real evidence for their investigation. They are not going to prosecute someone based only on what your narrative says. A SAR is not evidence. It doesn't prove anything.

The idea that every detail has to be repeated in the narrative is regional; e.g. the OCC in the eastern half of one state where I work insists that it's a "rule." In the western half, no such claim is made by any agency. Some auditors feel it's their job to "enforce" whatever the regulator's local office is going to say. I think it's very helpful for an auditor with local experience to give the bank a "heads up" about a common misinterpretation, but there's no need to make it the gospel, particularly when dealing with banks regulated by other agencies.

Frog Lady has a good template.
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