I am wondering if others file a SAR on deposited checks returned as NSF? I know there are so many possible extenuating circumstances, but a discussion at my FI has begun, and it's leaning towards filing on all deposited items returned as NSF if there is a loss.I think the age of the account, if there is a known relationship between the maker and our customer (self, family etc), any followup conversations, and a pattern of the same activity should be considered. I believe that in many instances, the customer is an innocent victim and did not have the intent to commit fraud, even though they withdrew the funds before the check was returned. And yes, sometimes the fraudulent intent can be determined, and should be reported. The argument seems to be that the BSA regulations require filing a SAR because it may be check fraud.

First, the decision to file a SAR shouldn't hinge on whether there is a loss. If there is suspected fraud and the amount meets the reporting threshold, then a SAR should be filed whether there's a loss or not. And the decision to file, as you pointed out, should depend on the circumstances involved. I have not filed a SAR on every returned check, but only when the circumstances made me suspect there was fraud involved. For example, a new customer deposits a large check, transfers the money somewhere else shortly thereafter, then the check is returned NSF and we are unable to contact the customer. In that instance I would file a SAR for suspected check fraud.

Thanks for the input!

we would file if we believed there was fraud OR an attempt at fraud and the amounts met the threshold, like toms stated. blanket filing on all? not a fan of defensive filings, so not done here.

Hi Sunny!

I'd handle it in the same manner that Tom and Happy stated. I would, however, be very watchful of an account that had a check returned, for any reason, when the dollar amount of the check is enough to meet the SAR threshold. My suspicion is especially triggered when my account analysis shows that the account holder made attempts to immediately access the funds after making the deposit, and that the deposit transaction (amount/type) is atypical activity for that account.