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#67417 - 03/13/03 08:42 PM Safe Deposit May Have Explosives
Anonymous
Unregistered

At our OFAC/BSA training today an employee told me she thought she should file a SAR on a customer. The customer comes in with a briefcase handcuffed to his hand and asked to go in his Safe Deposit Box. The employee said she has seen him very carefully lift the corner of the box and it appeared to her to have wires in the box. She is afraid it might be some kind of explosive . I told her to file a SAR immediately. However, I am not familiar with the Safe Deposit Box laws. Employees are not supposed to know what is the customers box. Should we contact law enforcement? Any advice would be appreciated.

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General Discussion
#67418 - 03/13/03 08:51 PM Re: Safe Deposit May Have Explosives
1111 Offline
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1111
Joined: Jan 2003
Posts: 580
First, contact the Bank's attorney.

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#67419 - 03/13/03 08:52 PM Re: Safe Deposit May Have Explosives
WildTurkey Offline
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WildTurkey
Joined: Jan 2003
Posts: 921
Down South, USA
What I am about to suggest may not give you any conclusive answers, but the first thing I would do is to check what else you know about the customer. .... How long has he banked with you? Is he local, or has he moved to your city/ state/ the US recently? Is his account activity consistent with his known occupation? Does he have a credit/ATM card that has been used outside the US? Does he make or receive transfers of funds regularly? Does he do much cash business? Does he have family with accounts at your bank?

Basically build yourself as complete a picture as you can before you consider what to do next. If, and others here no doubt know much more than I on this, there is a mechansism to report your concerns, then you'll be asked (subject to whatever orders/ subpoenas are appropriate) for all this information anyway by whatever law enforcement agency investigates the matter.
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#67420 - 03/13/03 08:54 PM Re: Safe Deposit May Have Explosives
JacF Offline

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WT brings up alot of good questions. Find out as much as you can about this customer. Also, what is the frequency of his safe deposit activity, and does he usually have a briefcase handcuffed to his hand?

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#67421 - 03/13/03 08:55 PM Re: Safe Deposit May Have Explosives
BrendaC Offline
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BrendaC
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Sweet Home AL
Remind me not to go into your safe deposit box vault in the near future.
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#67422 - 03/13/03 09:11 PM Re: Safe Deposit May Have Explosives
kdlmit Offline
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Sorry, I forgot to log on when I posted the question.

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#67423 - 03/13/03 09:13 PM Re: Safe Deposit May Have Explosives
kdlmit Offline
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Great advice. I was not sure where to begin. The only thing I know about the man is that he is retired from the service, not sure which branch of service.

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#67424 - 03/14/03 05:54 PM Re: Safe Deposit May Have Explosives
Elaine K. Sheehan Offline
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Elaine  K. Sheehan
Joined: Jul 2002
Posts: 157
Grand Rapids, MI
I would also consider the credibility of the employee who made this observation. Has the employee been overly anxious since 9/11? It would seem to me that an individual who intended to place explosives into a safe deposit box would attempt it more surreptitiously and not be wearing handcuffs or open the box in the presence of another person.


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#67425 - 03/17/03 01:44 AM Re: Safe Deposit May Have Explosives
kdlmit Offline
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The wires have been seen by several employees who are very credible.

No one seems to know a much about the customer so we are trying to find out as much as we can. He opened his checking account in 2002, his SDB in 03/02 entering a total of 43 times in 2002. So far this year he has gone in the box 15 times and he always has the brief case handcuffed to his arm. I check his account activity, very little in his account and writes small checks.

With all that is going on in the world today this concerns me a great deal. We can never be to careful. Anyway I'd rather be safe than sorry.

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#67426 - 03/17/03 01:49 AM Re: Safe Deposit May Have Explosives
Lucy Griffin Offline

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I'd file the SAR. If several employees have seen this, I'd have serious questions. First, seek advice of counsel. But as a pragmatic matter, the only legal way you can get into that box is with a federal agent producing a warrent.

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#67427 - 03/17/03 05:22 AM Re: Safe Deposit May Have Explosives
Deepa C Offline
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Deepa C
Joined: Dec 2002
Posts: 27
Dubai, UAE
How about notifying the bomb disposal squad of your local Municipality - they normally have several gadgets that indicate whether there is any explosive material.

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#67428 - 03/17/03 09:03 PM Re: Safe Deposit May Have Explosives
Lucy Griffin Offline

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Excellent point. They also have dogs trained to smell explosives. Of course, there could be some other contraband in other boxes. Could make for an interesting afternoon!

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#67429 - 03/17/03 09:15 PM Re: Safe Deposit May Have Explosives
Lestie G Offline

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Posts: 3,606
Near the Land of Enchantment
What would be the next step, if explosives are detected? Is that cause to drill the box? Would the bomb squad cordon off your vault and take over?
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#67430 - 03/17/03 09:25 PM Re: Safe Deposit May Have Explosives
Lucy Griffin Offline

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Lucy Griffin
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Fill out the SAR ASAP! Follow procedures and keep your safe harbor. If a customer is storing bomb-making materials in a safe deposit box, it probably isn't set to go off.

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#67431 - 03/17/03 10:02 PM Re: Safe Deposit May Have Explosives
Anonymous
Unregistered

HOLD THAT SAR REPORT!!!..............last time I looked, safe deposit activity was exempted from SAR requirements. You certainly have some issues here, but one of them is not the requirement to file an SAR report.

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#67432 - 03/17/03 10:04 PM Re: Safe Deposit May Have Explosives
JacF Offline

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I have never seen any exemption for safe deposit activity. Could you give us a cite?

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#67433 - 03/17/03 10:54 PM Re: Safe Deposit May Have Explosives
Uncle_Milty Offline
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New Jersey
Before you call in the dogs check out this news story:

bad dog

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#67434 - 03/17/03 11:25 PM Re: Safe Deposit May Have Explosives
Anonymous
Unregistered

Sorry, just got back to my desk after some a notary questions from a personal banker.
Take a look at the Federal Register from Monday, February 5,1996 (Vol. 61, No. 24, p 4327). Hopefully you've got it handy.
FinCEN discusses why (after it received strong comments) it decided to drop safe deposit activity from the definition of "Transaction". See 31 CFR 103.11 (ii) (b) "Treatment of Safe Deposit Boxes". Commenters logic as to why the opposed the inclusion in the definition of transaction included: long established banking practice where customer's use of safe deposit was a private transaction, not an account, potentially contrary to state law, etc. In explaining why they dropped it, FinCEN makes a reference to what might constitute a VOLUNTARY Safe Deposit SAR and it relates to where a bank has entered a box (search warrant?) and discovers criminally-derived property. But again, the SAR would still only be voluntary.
I have never filed an SAR on safe deposit activity regardless of the referrals I have received from staff ("customer eneters the box 4 days out of 5", "he wears a lot of gold", "I think I smell marijuana!"). Since whether or not we ever file an SAR is confidential throughout the organization, there are only a few employees that know if an SAR was actually filed. The referrals continue from safe deposit because staff does not realize they are 99.9% not likely to be filed. During training I don't want to point out the safe deposit activity is not included, because I want them to remain vigilant regardless of what area of the bank they are in.
I'm really glad I did not sign-in today and that I am posting anon. now that I read this post!
But, I continue to see safe deposit/SAR filing issues on BOL and I think we need to clrify IT IS NOT REQUIRED (but a bank certainly could voluntarily file if they enjoy paperwork).

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#67435 - 03/18/03 02:32 AM Re: Safe Deposit May Have Explosives
kdlmit Offline
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So does that mean we do not have safe harbor if we file? By the way, the man entered the box again today. When the employee let him back in his box she noticed a letter addressed to a person in Florida named Muhammad. Scarry.

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#67436 - 03/18/03 05:21 AM Re: Safe Deposit May Have Explosives
JacF Offline

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Safe harbor applies whether you file a mandatory or a voluntary SAR.

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#67437 - 03/18/03 02:10 PM Re: Safe Deposit May Have Explosives
Anonymous
Unregistered

Quote:

.... If a customer is storing bomb-making materials in a safe deposit box, it probably isn't set to go off.



I'm glad that you're so confident in the quality control procedures of amateur bombmakers.

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#67438 - 03/18/03 07:07 PM Re: Safe Deposit May Have Explosives
Arthur Dent Offline
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Arthur Dent
Joined: Mar 2003
Posts: 2
You might want to read the site referenced for general rules RE: Safe Deposit Boxes

http://www.bankersdigest.com/features_2001_4q/102201_feature.html

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#67439 - 03/18/03 07:52 PM Re: Safe Deposit May Have Explosives
rlcarey Offline
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Posts: 79,234
Galveston, TX
What I can't believe is that you have the potential for a bomb in your vault and the debate is whether or not to file a SAR???

How about the next time he shows up you call the police and tell him to remove all contents of the box, tell him you no longer want to do business with him, and have him escorted from the building. Why are you messing around with this? There is no law that says you have to do business or rent a box or keep renting a box to anyone. It is not their god given right to have a box at your bank - pull the plug before somebody gets hurt!
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#67440 - 03/18/03 08:01 PM Re: Safe Deposit May Have Explosives
Anonymous
Unregistered

Arthur,

Thank you for the link to the article by David P. McGuinn "Safe Deposit Box Bulging With Cash". The article is well written, but I believe the author has provided some inaccurate guidance (specifically #3 in the section entitled "It Is Still A Gray Area"). I'm fairly certain the only time FinCEN has dealt with the safe deposit issue is in my post above (see Fed. Register from feb. 5, 1996). Therefore, I would ask the author his cite for point #3 in his article.

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#67441 - 03/18/03 08:09 PM Re: Safe Deposit May Have Explosives
Lestie G Offline

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Posts: 3,606
Near the Land of Enchantment
Not to speak for Mr. McGuinn, but I think he just restated the same point you made in your earlier post - the SAR is voluntary - at the discretion of the bank.

Quote:

...FinCEN makes a reference to what might constitute a VOLUNTARY Safe Deposit SAR and it relates to where a bank has entered a box (search warrant?) and discovers criminally-derived property. But again, the SAR would still only be voluntary... ...and I think we need to clrify IT IS NOT REQUIRED (but a bank certainly could voluntarily file if they enjoy paperwork).




Mr. McGuinn's point:

"If a consumer is observed using his safe deposit box in ways that are considered suspicious, the financial institution might voluntarily submit a report. This exclusion could be construed as a subtle attempt to place accountability back in the lap of the financial institution."

I think you're making the same point. Both of you drew conclusions based on what FinCEN stated.
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