Last year, I filed a SAR on a branch teller in a small rural town. Her activity definitely indicated structuring. The head of Audit and HR discussed the activity with her, her supervisor and the local President. She a somewhat plausible explanation for why things occurred the way that they did. (I will spare you the details). HR reprimanded her and had her write a document about the activity, explain that she knows structuring is wrong, etc.

Now - THIS YEAR - a teller structured almost $40,000. When the issue was discussed with her, she admitted that she did not want to have a CTR filed. The head of HR didn't want to do anything except write up that it has been discussed and have her sign something stating that it would never happen again (a GIVEN I would think when your job is on the line). I finally got them to put her on probation for 90 days - again, kind of serves no purpose in my opinion.

Once again, I did file a SAR. I also plan to document that I disagree with HR's decision and place such documentation in the SAR file. She is a seasoned teller, not a newbie - and freely admitted that she committed a federal offense.

Any suggestions you have that will help me convince "the powers that be" that this is VERY SERIOUS and that the bank could be written up for this issue.

Thanks.

Take it up the chain - I have access to the president and the Board. If something that serious is being shrugged off by operations, it needs to be escalated.

AML-BSA violations will get a bank shut down. We've seen with Sigue, filing SARs is no longer the safe harbor the regulators make it out to be. You can file, but the organization needs to ACT on SAR findings. You need to be actively engaging senior management with issues like these to protect your institution from liability.

The real question is: did HR do enough? If you don't think so, you need to speak up.

In the past, I have used my regulator to drive a point home with management. It sounds like you have a well-documented file, including a CYA memo detailing your disagreement with how management is handling the issue.

During your next exam, have your regulator discuss the issue with management. If they will not listen to you about the seriousness of the issue, they should listen to them.

FBH - the fact is - I did speak up, quite heatedly, in a SAR committee meeting. The President of the Bank was absent that day and I do not meet with the Bd of Directors. I was quite adamant that I disagreed with the decision, that it was not harsh enough and that HR did not need to be the final sayso in regards to the internal SAR issues.

I had thought of pointing out the file to our regulators and asking that they bring the point home - to not penalize us - but to aid me with more credibility, how severe the issue is, etc.

Thanks - I look forward to more posts.

It sounds like you've done the documentation parts well, I'd still try to get a memo to the President/CEO and the BoD. At the end of the day, you can only present the risks and the consequences, executive management charts the course.

I like KC's approach, although I'd personally be hesitant to bring the issue directly to the examiner's attention. I've never bought in to the idea of "we're the government, and we're here to help." Don't get me wrong, you need to have an interactive approach with your examiners, but I'd make sure the issue was concluded and senior management and the Board had their opportunity to make a decision one way or the other before going outside the bank.

As an additional CYA step, as well as anticipating what the examiners are likely to ask, gather your documentation of the employee's prior BSA training. Send the documentation to the appropriate people within your organization to demonstrate that the employee knowingly structured the transactions, and that it wasn't just an uninformed or semi-informed mistake.

Obvoiusly my suggestion above is dependent on a couple of factors. You have to be comfortable with your relationship with your regulator. If he/she is someone you've had issues or disagreements with before, I would not suggest that you use this approach.

Also, this works much better is you are a bank that generally has it's house in order. If you have several exam issues already to correct, there is no sense in piling on.

I can only speak to my own experiences. I've been fortunate to be in banks that are generally pretty clean and I've fostered good relationships with regulators. I consider managing the regulator part of managing the exam.

Good luck.

Hope your employee isn't reading all this.

Not a chance

I agree 100% with the bolded part. While I dont know how your FI is structured, mine has an audit committee which I would go to if I feel the Board or Senior Management isnt treating this issue appropriately.

This is a very serious issue and decisions regarding this matter should not be made by HR.

This employee should have been terminated as soon as she made her admission that she was avoiding a CTR. Your president and BOD need to be made aware of this situation. If you fail to make sure they are aware of this it might cost you YOUR job. Believe me, I've seen this happen! If your bank is criticized during the next exam for this situation, your president and BOD are going to blame you for not informing them. The last thing they need is a "surprise" like this during an examination.

Contact your president and ask for a meeting. If you don't feel your president is going to understand how serious this situation is, go to your Audit Committee Chairman. I would not contact your regualtor.