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#595995 - 08/09/06 09:55 PM Repeat SAR filings
Chiquita Banana Offline
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Chiquita Banana
Joined: Jun 2002
Posts: 1,044
The banana bin
We have a customer, I'll call him Joe. In November 2004, Joe started completing transactions that we considered structuring so we filed a SAR. We then monitored the account for 90 days, however, Joe ceased structuring and we were all happy.

Fast forward to October 2005. Joe's at it again. We file a SAR, we monitor, he quits. We're happy. Sort of.

March 2006. Joe's being naughty again. We file a SAR, we monitor, he quits. We're happy. (See a pattern here? )

Then, we had our S&S. The Fed guy said that because we kept the accounts open and that he had subsequently picked up his bad habits, we should have aggregated the totals in Part III box 34. He then referenced the SAR review on page 49 (of the pdf. Actual page 43 in the document).

"FinCEN often receives questions regarding how to provide supplemental information for suspicious activity that has already been reported previously on a SAR but is still occurring. The following guidance is provided..."

Now, in my opinion, it's the STILL occurring that is tripping me up. Joe ceased his activity and we were not required to refile the SAR within the initial 90 days of each SAR filing. So, to me, it wouldn't be STILL occurring but occurring again. I guess it's a matter of semantics but has anyone else heard of this?

Plus, if I'm going to aggregate totals from 2004, 2005, and the first one in 2006, would I also then have my date range from 2004 to today?

Sorry so drawn out. Thanks mightily for your patience!
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#595996 - 08/09/06 10:03 PM Re: Repeat SAR filings
dare2dream Offline
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dare2dream
Joined: May 2005
Posts: 128
California
EWWWWWW I agree with you - I would say it was *occuring again* not *still occuring*. I would question that a bit more with your examiner - in the most polite and politically correct way of course
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#595997 - 08/10/06 01:38 AM Re: Repeat SAR filings
rlcarey Offline
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Joined: Jul 2001
Posts: 78,597
Galveston, TX
FWIW - I concur
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#595998 - 08/10/06 10:26 AM Re: Repeat SAR filings
Elwood P. Dowd Offline
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Elwood P. Dowd
Joined: Aug 2001
Posts: 21,939
Next to Harvey
1) I agree with you. Your interpretation is drawn from written instructions, not your imagination. Call FinCEN to see what they say. If it is addressed in the exit conference ask that your disagreement be noted and that a review examiner evaluate the criticism. Unfortunately, it's not a reasonable decision to accept a BSA criticism you know to be incorrect. Your next exam might have a criticism regarding SAR completion that's legit. Then, you've got yourself a repeat violation...

2) Every time I talk to people from FinCEN I bring up the fact that their approach to AML/BSA compliance isn't the same as that shown by the agencies. Some members of the latter group are more interested in playing Trivial Pursuit, racking up things they can describe as "violations." Thanks for another example. If this is all they can "find" your program must be pristine. It's prudence that requires you to stick to your guns.

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#595999 - 08/10/06 01:58 PM Re: Repeat SAR filings
Chiquita Banana Offline
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Chiquita Banana
Joined: Jun 2002
Posts: 1,044
The banana bin
Thanks. That's what I was thinking also. And yes, this was pretty much the only thing he could dig up on our program. So, I suppose I'll take it.

I'll call FinCEN and see what they say. Thanks again!
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#596000 - 08/10/06 02:42 PM Re: Repeat SAR filings
First Banker Offline
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First Banker
Joined: Apr 2005
Posts: 403
Florida
I have the same situation. He was structuring and I filed a SAR, and he quit. Now he is back at it. I just filed a second SAR this month. My thinking was like yours. I mentioned the previous SAR in my narative, but everything else on the second SAR is as if it were new activity. My Fed examiner will see this next year....

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#596001 - 08/10/06 05:14 PM Re: Repeat SAR filings
devsfan Offline
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Joined: Jun 2004
Posts: 1,927
NYC
Wouldn't this depend on the time between the initial SAR and the subsequent one(s)? If your 90 day follow-up comes up clean but the "bad stuff" happens again, lets say very shortly afterwards, I would think that the follow-up SAR should show aggregated information. If the "bad stuff" does not happen for 3 months after the 90 day follow-up period, but then starts again, I might be tempted to aggregate as well. I would be interested if you could share whatever guidance you receive from FinCEN.

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#596002 - 08/10/06 07:35 PM Re: Repeat SAR filings
Chiquita Banana Offline
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Chiquita Banana
Joined: Jun 2002
Posts: 1,044
The banana bin
Well, I guess nobody is going to like the answer. Devsfan is right though.

I spoke with a rep with FinCEN who said that they had a very lively discussion about this issue (I like to wreak havoc. It's fun. )

Their conclusion: Even if the activity stopped after the initial filing but then a year later, the customer began doing the same activity (in this case structuring), the amounts should be aggregated and the date should reflect from the very START. The narrative should reflect when previous SAR's were filed and the breakdown of the aggregated amounts of those transactions noted.

So, in my case, the dates reflected will begin 2004 and end today. The amount will include ALL amounts from 2004 to today.

The FinCEN rep said that they had to really discuss what the purpose of a SAR is for and if the customer continued with the same type of behavior, even if s/he had stopped, it could help law enforcement know that this is an ongoing problem.

I nicely told him that FinCEN should come out with better commentary on this subject as it's very ambiguous to say the least...considering it's only mentioned in a SAR Activity Review. (Who really reads those things anyway?!)
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#596003 - 08/10/06 09:02 PM Re: Repeat SAR filings
Elwood P. Dowd Offline
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Elwood P. Dowd
Joined: Aug 2001
Posts: 21,939
Next to Harvey
Thanks for reporting back. As another post in the private forum indicates, some of the verbal advice being given is unsupportable. Another banker who follows this approach could just as readily be criticized for aggregating dollar figures that were based on activity occurring months apart.

We really do need that BSA commentary that Congress mandated and (now former) Chairman Fox promised.
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