New SAR Up And Running... But Some Reporting Problems Remain

The new Suspicious Activity Report is now in use by the financial industry, joining the new ones being used by Casinos and Card Clubs, the Securities and Futures Industries, and by the Money Services Business (MSB). There are only a few changes from the one the financial industry has been using for the past three years.

The first page has no change at all except for the effective dateThe top of the second page Part III has had two boxes added - one for terrorist financing and one for identity theft.

Identity Theft Reporting
Although there are several paragraphs in FinCEN's latest SAR Activity and Review - Trends & Tips - Issue 5 on how to mark and report terrorist activity, the instructions are silent on exactly how to report Identity Theft. BANKERS' HOTLINE Editor, Barbara Hurst, had conversations with contacts in Washington, D.C. and elsewhere about the Identity Theft designation. The outcome was a consensus of opinion from several agencies, regulators, advisors and attorneys that if you are reporting an incident of Identity Theft, the person whose name/identity was stolen (the victim) should NOT be named as the Suspect on line 15 of Part II. The victim's name should only be in the narrative. Otherwise, the victim's name may go in the data base as a suspect, which could cause some problems later on for the individual - and subsequently also the financial institution that filed the report.

On page 3, at the bottom of Part V is a web site at FinCEN that says there are tips on filing.

And in the instructions on page 4 the Safe Harbor provisions have been updated to incorporate USA PATRIOT Act changes.The new form went into use July 1. Old SARs will not be accepted after December 31, 2003. All media forms are available at www.fincen.gov.

Copyright © 2003 Bankers' Hotline. Originally appeared in Bankers' Hotline, Vol. 13, No. 5, 7/22