We have a commercial check casher (or as Ken would say, an MSB on steroids). The customer provides us with excel spreadsheets of each check that they cash each day and we aggregate these spreadsheets over a 1 month period to detect possible structuring by the customers (payees) of the check casher. We have filed SARs for what we considered as structuring, identifying our customer and the payees as suspects on the SAR.

Now the check casher has begun to file SARs, and we just reviewed their filings and were pleased that we each agreed as to which payees were structuring.

My question is, since the check casher is filing the SARs must we also file? On 1 hand it seems a bit redundant, but on the other hand the checks are still going through our bank, the examiners are very interested in these accounts, etc, etc.

What are your thoughts?

It's the check casher's responsibility to file these SARs, not yours. You file a SAR if you suspect that the check casher is doing something suspicious; the check casher files if it suspects one of its "clients" as doing something fishy.

It's terrific that your check cashing customer is willing to work with you here, but I think you might reasonably consider whether the detail you're getting from it falls under the heading "too much information." You are not expected to be this business's regulator. I think you might be biting off more work than you reasonably need to do here. A periodic sampling of this information might be something you want, but I see overkill in your current arrangement.

It occurred to me to question whether you should know that the check casher filed an SAR. They are subject to confidentiality as well.

Excellent point, Kathleen!

John, Please tell this to the FDIC examiners who cited us for "an apparent violation of Section 353.3(a)(2) of the FDIC Rules when we were examined 6 months ago. At that time we were getting the activity information from the check casher but not doing anything with it due to staff turnover. We agreed to actively monitor the activity and have been successful in convincing the check casher that they should be filing SARs where they think it appropriate. Now that they are I would like to be able to step back a bit, but am not sure if the filing by the check casher is sufficient. Please also bear in mind that this is a commercial check casher ($6-7 Million per month), not a mom+pop grocery market. Any follow-up thoughts on this?

Only an echo of the comments above, I don't think you want or need this level of insight into the administration of the MSB's compliance program. The original guiance on bank/MSB relations made you the de facto regulatory agency. The revised guidance removed that responsibility. Consider writing a memorandum regarding your review of their operations and your findings that they were satisfactory and then excuse yourself from future monitoring.

On the issue where you actually asked for an opinion , if reviewing their SARs has brought something to your attention and you find the basis for filing in your own records then you file. The proposed SAR revision mentions "joint" SAR filings so the concept of sharing information with others, including MSBs, isn't off the wall. You just don't want to be the point man on finding out what the boundaries are.

Your second post wasn't visible when I wrote the above... While I don't agree with the criticism, I think the problem was that you had the information and were not using it. Given the criticism, the best solution is to not have the information. Even if this is a valued client, your involvement is very expensive to your institution. Consider requiring them to have independent audits perfromed by an independent firm chosen from a list you provide. You need to get out of the loop.