On January 21, 2021, the Financial Crimes Enforcement Network (FinCEN), along with federal financial institution regulators, issued responses to frequently asked questions on suspicious activity reports (SARs) and other anti-money laundering (AML) requirements.  The stated goal of this release is to clarify regulatory requirements and assist financial institutions with compliance obligations, particularly SAR filing, while enabling them to focus resources on activities that produce the greatest value to law enforcement agencies and other government users of Bank Secrecy Act (BSA) reporting.

The FAQ answers provided, in part, the following guidance:

  • A financial institution (FI) may maintain an account or customer relationship for which it has received a “keep open” request from law enforcement, even though the FI has identified suspicious or potentially illicit activity. However, the FI is not obligated to do so and should not be criticized for its decision either way based on its own policies, procedures, and processes.  FIs should maintain documentation of “keep open” requests, even after they have expired.
  • While a grand jury subpoena or other law enforcement inquiry does not by itself indicate the need that a SAR be filed, it should prompt an assessment of risk in accordance with a financial institution’s AML program procedures. A FI should review relevant account activity and transactions and all information available to determine whether a SAR should be filed. If the FI decides to file a SAR, the SAR should focus on the facts and circumstances relevant to the suspicious activity detected by the FI rather than on the subpoena or inquiry itself.
  • There is no requirement that a FI terminate a customer relationship after filing a SAR, or even multiple SARs. Management should follow the institution’s risk-based policies and procedures and make such decisions based on the risk profile of the customer, including the geographical locations involved, the volume and type of transactions conducted, the type of account, and the types of SARs filed.
  • FIs should not file more than one SAR on the same suspicious activity to accommodate for a long narrative. Filers must provide a clear, complete, and concise description of the suspicious activity, focusing on the relevant information in the narrative as much as possible.  A FI may include additional, relevant information as an attachment to the SAR, or note that it is available as supporting documentation.
  • The existence of negative news identified in media searches related to a customer does not in and of itself trigger the need to file a SAR. Where multiple negative news alerts are based on the same event, a FI does not need to independently investigate each alert.

Throughout the responses, the agencies highlight the flexibility FIs have in developing and implementing risk-based policies, procedures and monitoring processes in determining whether to file SARs and comply overall with the AML and BSA legal requirements.