Suspicion Concerning Source of Funds

Posted By: PrimeTime

Suspicion Concerning Source of Funds - 05/08/15 12:43 PM

Looking for some additional opinions on this situation as I'm unsure of whether or not I have enough substance to warrant a SAR filing.

Customer A opens a deposit account 2 years ago. After a thorough review of activity, it was identified that the only activity going through the account was the deposit of checks from non-customer B, waiting a period of approx. 1-2 months, then withdrawing an amount similar to the amount deposited via the non-customer B checks, and using the funds to make an Official Check payable to non-customer B. This happens about 10 times in the span of 2 years, with a decent amount of money.

Upon further investigation, non-customer B was indicted for a crime that involved money (probably shouldn't get into the specifics). This activity starts right around the time that the investigation appeared in the newspapers.

So, having said all that, would it be reasonable to file a SAR using the "suspicion concerning the source of funds", due to the fact that a) the individual who owns the account is clearly using the account on behalf of non-customer B and b) the funds may be utilizing this channel to clean them/distance non-customer B from them, etc.

Just curious to see what others think of this situation. I probably left some details out so feel free to question!
Posted By: John Burnett

Re: Suspicion Concerning Source of Funds - 05/08/15 12:57 PM

Given the backstory on the indictment and the pattern of activity in the account, I think you have a SAR filing to do based on your source of funds concerns.
Posted By: PrimeTime

Re: Suspicion Concerning Source of Funds - 05/08/15 02:18 PM

Great, thank you very much for your response!
Posted By: Pat Patriot Act

Re: Suspicion Concerning Source of Funds - 05/11/15 11:20 AM

I'll join the chorus. IMHO, the activity described is nearly enough alone to file. The negative news is icing on the cake.
Posted By: PrimeTime

Re: Suspicion Concerning Source of Funds - 05/11/15 03:15 PM

Thanks (fellow) patsfan, that was the mindset I was in as well, I just like to get the validation on here before I bring it to the table.
Posted By: Elwood P. Dowd

Re: Suspicion Concerning Source of Funds - 05/11/15 05:55 PM

Intriguing. The loop starts with a check payable to B. It ends with a cashiers check payable to B.

I wonder what it is they think they are accomplishing...maybe the account is just a temporary holding tank for the funds where they cannot be identified as belonging to B.

Either way, A is acting operating a nominee or straw man for B. I'd give A the boot before I worried about anything else.
Posted By: PrimeTime

Re: Suspicion Concerning Source of Funds - 05/11/15 09:44 PM

Ken, that is exactly what we believe they are attempting to accomplish. The negative news indicated that B was involved in a scam in which there was a large sum of money split between several individuals as proceeds. They're then attempting to distance themselves through this method going through another individual's account, letting the funds sit for a prolonged period of time after being deposited, and then withdrawing them again in a more liquid form of an official check.

I just don't see how they think they can avoid the paper trail by not withdrawing as cash rather than an official check. I guess that's good news for us though!