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SAR'd Customer Eligible for a Phase II Exemption?

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Question: 
Can a customer who has had SARs filed on them for a suspected BSA suspicious activity be eligible for a phase II exemption?
Answer: 

31 CFR 103.22(d)

(6) Operating rules--(i) General rule. Subject to the specific rules of this paragraph (d), a bank must take such steps to assure itself that a person is an exempt person (within the meaning of the applicable provision of paragraph (d)(2) of this section), to document the basis for its conclusions, and document its compliance, with the terms of this paragraph (d), that a reasonable and prudent bank would take and document to protect itself from loan or other fraud or loss based on misidentification of a person's status, and in the case of the monitoring system requirement set forth in paragraph (d)(9)(ii) of this section, such steps that a reasonable and prudent bank would take and document to identify suspicious transactions as required by paragraph (d)(9)(ii) of this section.

First published on BankersOnline.com 2/25/08

First published on 02/25/2008

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