Should We File a SAR if...? Yes. Now Tell Me the Facts.
I get a lot of phone calls from clients about whether to file a suspicious activity report (SAR). My immediate answer is “YES,” without even hearing the facts. Yesterday, I tested this with an FDIC representative at a compliance conference where I was presenting on other issues. I asked a simple question, “Has any bank ever been criticized for filing a SAR?” The answer was an immediate “NO.” If there is even the slightest chance that a SAR is required, our advice is to file. You can’t get into trouble if you file, but as many of you know, it’s very easy to be criticized if you don’t. Federal Law provides absolute protection from civil liability for filing a SAR. The FinCEN guidance on this protection says that it applies, “to SARs filed within the required reporting thresholds as well as to SARs filed voluntarily on any activity below the threshold.” Even for small crimes, you are not required to report, you are still protected if you do.
Today’s Takeaway? When in doubt, file it. Let the law enforcement people sort it out. If the suspicious activity touches your bank systems, premises, or your employees when performing their duties, or when the suspicious activity is perpetrated using a bank product, even though there is no damage to the bank, file a SAR.
Jay L. Hack is available at firstname.lastname@example.org.