suspicious activity report case study

9 Suspicious Activity 2024 Examples + How to Identify & Report Them

Suspicious activity in banking and financial institutions is widespread. In fact, in less than two decades—between 1999 and 2017—American financial institutions identified more than $2 trillion of suspicious activities . That figure mirrors the entire annual GDP of Italy, the country with the eighth highest GDP in the world. 

Furthermore, keep in mind that this figure merely represents the level of suspicious activity filed via a SAR (Suspicious Activity Report) —it is highly likely that plenty more suspicious activity, perhaps as much as $1 trillion worth, occurred during this same period.

Since it’s not an exact science, there is always going to be some level of manual investigation into potentially suspicious transactions needed to determine whether a report must be filed. Here, we’ll dig into this topic to help you understand the nuances around what constitutes a suspicious transaction and what doesn’t, including:

What Are Suspicious Transactions in Banking?

9 financial & bank suspicious activity examples, what is the threshold for reporting suspicious transactions, how to identify suspicious activity & money laundering.

Let’s dive in with the basics of what actually counts as suspicious activity when it comes to financial transactions.

Suspicious transactions are any event within a financial institution that could be possibly related to fraud, money laundering, terrorist financing, or other illegal activities. Suspicious transactions are flagged to be investigated, but many suspicious transactions are simply false positives .

What Makes a Transaction Suspicious?

One of the problems with filing suspicious activity reports is that there is no universal definition of what constitutes suspicious activity. A given action might be deemed suspicious if it occurs within one account, while the same activity would be considered “normal” if it occurs in another.

For example, it might make sense for a petroleum supplier to receive a $100 million wire transfer from a foreign conglomerate, but if that same action were to appear in the account of a local non-profit, it would raise some red flags.

Finding the “threshold” for what constitutes suspicious activity is far from easy. However, by keeping a few basic principles and protocols in mind, financial institutions of all kinds can make some much-needed changes and improve how they monitor suspicious activity.

Generally speaking, a financial transaction might be deemed suspicious if it is unlike any other activity that has occurred within that account. Of course, an activity being new will not necessarily mean that any malicious actions have occurred. 

For example, an individual making a sizeable down payment on their first home is an activity that is unusual but not malicious. The processes involved in identifying suspicious activity are far from cut and dry. However, it is still a good idea to flag—and potentially follow up on—any action that seems far from the norm.

Regulations Around Suspicious Transactions

As FinCEN —the Financial Crimes Enforcement Network—has helped describe, transactions that “serve no business or other legal purpose and for which available facts provide no reasonable explanation” are one of the most common signs of suspicious activity. 

This means that, in some cases, financial institutions will need to monitor the size of transactions occurring within their system and monitor the types of transactions taking place and determine where these transactions originated from.

The Bank Secrecy Act (BSA) , which was signed into law in 1970, establishes responsibility for financial institutions to keep an eye out for signs of suspicious activities and report them to the corresponding authorities (usually within 30 days). The purpose of the BSA is to combat some of the most common forms of suspicious activity, including money laundering, theft, tax evasion, financial fraud, and more. 

However, the BSA, contrary to some other financial regulations , still contains a lot of gray areas. Financial institutions will want to ensure they are compliant and report these sorts of activities within a timely manner (or else face fines and possible legal consequences). But at the same time, they will need to balance their account holders’ fundamental rights to privacy.

Ultimately, no formula will clarify that a given activity must be reported or will never need to be reported. But carefully monitoring for a few common red flags—substantial transactions, transactions from an unclear location, foreign transactions, identity fraud, and others—will help these institutions better balance their seemingly “competing” interests.

As the Federal Deposit Insurance Corporation (FDIC) helps explain, many different types of transactions might trigger the need to file a SAR. These can include, but are by no means limited to, the following transactions:

1. Money Laundering

This process involves taking money generated by an illicit activity and “cleaning” the money by falsely presenting it as if it were earned through a legitimate business. One of the largest money laundering schemes of all time, dubbed the 1MDB scandal , involved the theft of more than $4.5 billion from a Malaysian state fund that was then laundered through Goldman Sachs. Following trial, Goldman Sachs was forced to return most of the funds to Malaysia and pay a $600 million fine.

Money laundering is one of the most costly types of fraud occurring in financial institutions, making Anti-Money Laundering compliance paramount in any fraud management system.

2. Cash Transaction Structuring

This involves splitting or otherwise altering financial transactions to avoid automatic reporting to tax authorities. Usually, structuring is done to avoid being subject to certain taxes or to conceal otherwise an organization’s wealth (which may help them qualify for certain loans, etc.).

3. Check Fraud

A broad term used to describe any deliberate misrepresentation, use or creation of checks, check fraud can include writing fraudulent checks, altering checks, creating bad checks (checks you know will bounce), and more. According to one recent estimate , roughly 2 million bad checks are processed daily through the Automatic Clearing House (ACH) system.

4. Check Kiting

This is a form of check fraud that involves writing a check from an account with insufficient funds and depositing that check into another bank account. Due to “the float”—the time before checks are cashed between banks—this can temporarily give people access to uncovered funds.

5. Wire Transfer Fraud

This is a broad term used to describe any situation in which malicious activity occurs during the course of a wire transfer . Perhaps one of the most well-known wire transfer scams was the “Nigerian Prince” email fraud, which happened in the early 2000s ( and still makes a considerable amount of money today ).

6. Mortgage and Consumer Loan Fraud

This type of fraud involves consumers deliberately misrepresenting their financial position to secure a loan (usually, a large loan, like a mortgage). Misrepresenting income, overvaluing assets, and underreporting expenses are all types of consumer loan fraud.

7. Misuse of Position (Self-Dealing)

This term describes any instance where a fiduciary—a financial agent acting on behalf of their client—takes action or makes a suggestion that is their own best interest, rather than the client’s. For example, if a fiduciary invests a client’s funds into their account, that would be considered self-dealing.

8. Identity Theft or Fraud

While identity theft is used to describe an instance where someone is pretending to be someone else, identity fraud is used to describe any misrepresentation of a person’s identity. These suspicious activities can result in severe punishments, even if no financial transactions have occurred.

9. Terrorist Financing

While the federal government has laws and regulations banning financial transactions connected to any illegal activity, it is particularly strict about activity that could be linked to terrorism. Since the passage (and subsequent renewal) of the USA PATRIOT Act , regulators have a broad ability to monitor certain accounts for terrorist financing .

These are just a few of the most common types of suspicious activity a financial institution can potentially encounter. Therefore, if there are any indicators that these, among other, suspicious activities have occurred, financial institutions are required by law to file a SAR.

There are several different types of suspicion that might, eventually, necessitate the need to file a report.

At first, a financial institution might have a “simple suspicion”—at this point in time, they might have a hunch or believe that suspicious activity might be occurring but do not yet have enough evidence or reason to file a report. Because this stage does not include articulating any reasons for suspicion, this hunch can come from as little as a simple irregular activity within an account.

Eventually, this simple suspicion might grow into reasonable grounds to suspect—this occurs once they have a legitimate reason to suspect illicit activity is occurring. Then, they have some evidence to prove that their suspicion is more than an ordinary “hunch.” This would include some reporting around the irregularities and an explanation for what makes them suspicious, though does not require any proof that the activity is fraudulent or illegal.

At this point, it is unlikely that the accused party could be convicted of any crime within the criminal justice system. Nevertheless, by law, even a tiny red flag or a single piece of tangible evidence should be considered enough to file a suspicious activity report. Keep in mind, only some SARs are followed up on (The Bank Policy Institute reports that as few as 4% are reviewed by law enforcement ), and an even smaller fraction ever results in a criminal conviction. Not all red flags are related to the transactions themselves either— non-monetary indicators can be just as fruitful in identifying suspicious activity.

As evidence continues to build—more suspicious transactions occur, there are signs of financial crimes , etc.—a suspicion might eventually become grounds to believe that illicit activity has occurred. By this point, financial institutions have a legal (and perhaps moral) obligation to report this activity to authorities.

Once the threshold is reached and there is no reasonable justifiable reason for the behavior, then a SAR is required for each incident of suspicious activity. SARs must be submitted to FinCEN within 30 calendar days of the suspicious activity occurring. To follow guidelines and avoid fines and penalties, read more about our detailed instructions on how and when to file a Suspicious Activity Report (SAR) .

Final Activities Report

Staying vigilant is crucial in combating suspicious activities. Understanding how to effectively report suspicious activity ensures that financial institutions remain protected from potential threats. Recognizing the signs and knowing how to report suspicious activity, whether it's related to a person, image, or vehicle, is essential for maintaining security.

By utilizing tools and methods for searching and learning within the community, individuals and organizations can better identify and address suspicious behavior. Collaboration and knowledge sharing within the community enhance our collective ability to safeguard against financial crimes.

Ultimately, while there is not an explicit cutoff for what constitutes suspicious activity, it is the responsibility of financial institutions to keep an eye out for the early signs that any of the activities listed above have occurred. It's important to incorporate transaction monitoring into your fraud and AML system to effectively combat threats.

Luckily, with technologies like Unit21, monitoring , investigating , and reporting these sorts of activities is easier than ever before. With diligence, a thorough understanding of the law, and a commitment to consistent banking, both large and small financial institutions can develop the SAR protocols they need to remain compliant and help in the fight against financial fraud.

For more information about how Unit21 can help, get in touch today .

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What is a suspicious activity report?

A Suspicious Activity Report (SAR) is a document that financial institutions, and those associated with their business, must file with the Financial Crimes Enforcement Network (FinCEN) whenever there is a suspected case of money laundering or fraud. These reports are tools to help monitor any activity within finance-related industries that is deemed out of the ordinary, a precursor of illegal activity, or might threaten public safety.

Who regulates suspicious activity reports?

Suspicious activity reports are a tool provided by the Bank Secrecy Act (BSA) of 1970. Originally called a "criminal referral form" the SAR became the standard form to report suspicious activity in 1996. Mainly used to help financial institutions detect and report known or suspected violations, the USA Patriot Act expanded SAR requirements to help combat domestic and global terrorism. Whether financial or otherwise, SARs enable law enforcement agencies to uncover and prosecute significant money laundering, criminal financial schemes, and other illegal endeavors. SARs give governments an opportunity to spot and analyze emerging trends and patterns across a broad spectrum of personal and organized crimes. With this knowledge, they can anticipate and counteract fraudulent and criminal behavior before it gains a foothold.

When is a suspicious activity report required?

The criteria for providing a SAR differs from country to country and even from institution to institution, depending on the nature of the suspicious activity and the particulars of the bank or fund. In the United States, FinCEN requires a suspicious activity report in a few instances. First, if financial institutions believe an employee engaged in insider activity, they must file a report. However, it is not limited only to employees. Financial institutions monitor customer transactions, too. If potential money laundering or violations of the BSA are detected, a report is required. Computer hacking and customers operating an unlicensed money services business also trigger an action. Once potential criminal activity is detected, the SAR must be filed within 30 days. If more evidence is needed – such as identifying a subject involved – an extension not to exceed 60 days is available. Finally, SAR filings must be kept for five years from the date of the filing. Failure to comply with any of these regulations can result in civil and criminal penalties, including substantial fines, regulatory restrictions, loss of banking charter, and even imprisonment.

What institutions need to be aware of suspicious activity reports?

Many different types of financial industries require SAR reports, including banks and credit unions, stock and mutual fund brokers, and various money service businesses (check cashing companies, money order providers, etc.) However, casinos and card clubs, precious metals or gems dealers, insurance companies, and those involved in the mortgage business, all fall under the stipulations of the BSA. If there is an opportunity for money laundering, tax evasion, or criminal financing within the day-to-day business of the institution, the organization and its employees are required to be aware of the rules and regulations around suspicious activity reports.

Who can report suspicious activity?

A suspicious activity report can start with any employee within a financial institution. Employees are generally trained to flag and investigate suspicious activity. For example, if an employee notices an anonymous wire transfer of money out of the country or large amounts of money deposited into an account that had never seen such activity before, they would communicate their findings to supervisors who decide whether to file a report. While most SARs come from the financial sector, law enforcement, public safety workers, city or state officials, business owners, and even the general public can submit a suspicious activity report. The report functions in the same way as it does with financial matters. Whether it is a financial matter, or one related to national security, a suspicious activity report ultimately circulates to local, state, and federal agencies through the use of fusion centers. These centers make the information available to whatever other agencies may be affected by the flagged activity.

How confidential are suspicious activity reports?

The effectiveness of a SAR report is connected to the extreme confidentiality required for such reporting. At no time is the person under investigation told about the pending report. Likewise, any discussion with outside groups such as media companies is considered an unauthorized disclosure and is a federal criminal offense. When a bank or financial institution files a SAR, they are required to take significant steps to ensure the information provided is reviewed at multiple stages by financial investigators, company management, and attorneys before finalizing the SAR. Maintaining a high level of confidentiality is vital. As a result. there are special privileges that protect people who submit suspicious activity reports, whether as a part of a company or on their own. The individual (or organization) is not required to disclose their name and are immune to the discovery process. All reporters receive immunity for statements made in the SAR.

How do you submit a suspicious activity report?

Since 2012, all SAR filings are required to go through FinCEN's BSA e-file system. This system allows for greater standardization of the information, as well as increased efficiency, which is critical in situations where public safety is a concern. When a SAR is filed, five sections of information are required. First, reporters collect names, addresses, social security numbers, birth dates, driver licenses or passport numbers, occupations, and phone numbers of all parties involved. Next, the dates of the incident, as well as codes for the suspicious activity require documentation. Reporters are then asked to provide information about the financial institution where the activity occurred, as well as contact information for the institution. Finally, a written description of the activity is developed, providing a narrative to the data.

Where can I find SARs forms?

The standard SAR form is on the BSA e-file system. However, there are many online tutorials and databases to help financial employees, legal professionals, and lay people navigate the complexities of the reporting process.

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AML Case Studies Demystified: Lessons Learned from Real-Life Scenarios

Understanding AML Compliance

To combat money laundering and other financial crimes effectively, it is crucial to have a thorough understanding of Anti-Money Laundering (AML) compliance. This section explores the importance of AML training and provides an overview of AML regulations.

The Importance of AML Training

AML training plays a vital role in equipping professionals with the knowledge and skills necessary to detect and prevent money laundering activities. Training programs educate individuals working in compliance, risk management, and anti-financial crime about the latest AML regulations, techniques used by money launderers, and the identification of suspicious transactions.

By providing comprehensive AML training to employees, organizations can foster a culture of compliance and ensure that their staff is well-prepared to fulfill their responsibilities in preventing money laundering. Training programs often cover topics such as recognizing red flags , understanding customer due diligence, conducting enhanced due diligence for high-risk customers, and reporting suspicious activities.

Regular and up-to-date AML training is essential to keep pace with evolving money laundering techniques and regulatory requirements. It helps professionals stay informed about emerging threats and best practices, enabling them to make informed decisions and take appropriate actions to safeguard their organizations from financial crime.

Overview of AML Regulations

AML regulations form the legal framework that governs the prevention, detection, and reporting of money laundering activities. These regulations aim to ensure that financial institutions, businesses, and professionals adhere to strict compliance standards to combat money laundering effectively.

While specific AML regulations vary by jurisdiction, there are common elements found in most frameworks. These include customer due diligence, ongoing monitoring of customer transactions, reporting of suspicious activities, and record-keeping requirements.

In the United States, the Bank Secrecy Act (BSA) of 1970 is the cornerstone legislation in the fight against money laundering. It establishes compliance obligations for financial institutions and carries penalties ranging from fines to imprisonment. The USA PATRIOT Act further requires banks and financial institutions to understand their AML compliance obligations, with potential penalties of fines, imprisonment, or both for non-compliance .

In the European Union, Anti-Money Laundering Directives (AMLDs) set out the regulatory requirements that member states must follow. The 6th EU AMLD, implemented in June 2021, increases criminal liability, penalties, and fines for money laundering offenses. Similarly, the United Kingdom has the Proceeds of Crime Act (POCA) as its primary AML regulation, imposing penalties for non-compliance ( Unit21 ).

Financial institutions and businesses in Australia must comply with the requirements set forth by the Anti-Money Laundering and Counter-Terrorism Financing Act. Recent cases, such as Westpac being fined $920 million in 2020 for AML failings, highlight the importance of robust AML compliance.

By understanding the AML regulations applicable to their jurisdiction, organizations can establish effective compliance programs and implement the necessary measures to prevent money laundering activities. Regular training, coupled with adherence to AML regulations, is key to maintaining a strong defense against financial crime.

Real-Life AML Case Studies

Examining real-life AML case studies , we can gain valuable insights into the challenges faced by financial institutions and the lessons learned from these scenarios. These case studies shed light on the importance of financial institution reporting in AML investigations, the consequences of AML enforcement actions and fines, the role of red flags and suspicious activity reports (SARs), as well as the impact of AML compliance failures in major banks.

Case Study 1: Financial Institution Reporting in AML Investigations

Financial institution reporting plays a crucial role in AML investigations. The data collected by the Financial Crimes Enforcement Network (FinCEN) under the Bank Secrecy Act (BSA) has proven invaluable in connecting the dots related to money laundering, terrorist financing, and other financial crimes. Prompt and accurate reporting by the financial industry assists law enforcement in identifying patterns, associations, and suspicious activities.

For instance, FinCEN holds an annual Law Enforcement Awards ceremony to recognize successfully prosecuted cases that made effective use of financial institution reporting. This program aims to emphasize the value of financial industry reporting to law enforcement and highlight the importance of reporting by the financial industry in combating financial crime ( FinCEN ).

Case Study 2: AML Enforcement Actions and Fines

Recent AML enforcement actions have demonstrated the significance of robust AML compliance programs. Failure to implement adequate risk assessments and transaction monitoring can result in severe consequences. Regulatory authorities have imposed significant fines on financial institutions for AML compliance breaches. For example, Westpac in Australia was fined $920 million in 2020 due to AML failings. Deutsche Bank also faced substantial penalties, agreeing to pay over $130 million in fines to resolve AML allegations by US authorities in 2017.

These cases underscore the importance of conducting thorough due diligence on customers, implementing strict compliance measures, and continuously updating AML compliance programs to avoid hefty penalties and reputational damage.

Case Study 3: Red Flags and Suspicious Activity Reports (SARs)

Red flags and suspicious activity reports (SARs) are vital tools in detecting and reporting potential money laundering activities. AML case studies have highlighted the significance of recognizing red flags and promptly filing SARs. By identifying suspicious transactions, financial institutions can contribute to the prevention and detection of money laundering.

Understanding the definition and types of suspicious transactions is essential in this process. Financial institutions should educate their staff on recognizing these red flags and provide training on how to properly complete and submit SARs. This proactive approach helps ensure compliance with AML regulations and enables the sharing of critical information with law enforcement agencies to aid in investigations.

Case Study 4: AML Compliance Failures in Major Banks

Major banks have faced significant AML compliance failures, leading to severe consequences. Scandals involving institutions like Wachovia Bank, Standard Chartered Bank, and Danske Bank serve as cautionary tales, underscoring the importance of robust AML compliance programs in preventing money laundering.

For example, Wachovia Bank allowed drug cartels in Mexico to launder nearly $390 billion through its branches between 2004 and 2007, highlighting the necessity of preventing money laundering in financial institutions like banks. Standard Chartered Bank was fined $1.1 billion for violating U.S. sanctions against Iran and failing in anti-money laundering controls that facilitated $265 billion in transactions ( Sanction Scanner ). Danske Bank faced one of the largest money laundering cases, with its Estonian branch allegedly facilitating illicit transactions totaling approximately $228 billion between 2007 and 2015.

These case studies emphasize the critical importance of maintaining a robust AML compliance program, conducting regular risk assessments, and proactively monitoring transactions to prevent money laundering activities. Financial institutions must learn from these failures and continuously evaluate and enhance their AML compliance efforts to protect themselves and the global financial system.

By studying these real-life AML cases, professionals working in compliance, risk management, anti-money laundering, and anti-financial crime can gain valuable insights to inform their own AML compliance programs and contribute to the prevention of money laundering.

Lessons Learned from AML Cases

Examining real-life AML cases provides valuable insights and lessons that can help enhance AML compliance efforts. By understanding the challenges faced by organizations and the consequences of compliance failures, professionals can strengthen their risk assessment, transaction monitoring, and compliance programs.

Importance of Risk Assessments and Transaction Monitoring

Recent AML enforcement actions have emphasized the significance of conducting thorough risk assessments and implementing robust transaction monitoring systems. Risk assessments assist in identifying and understanding the potential money laundering risks associated with customers, products, services, and geographic locations. This information is then utilized to tailor compliance measures and allocate resources effectively.

Effective transaction monitoring is crucial in identifying suspicious activities and detecting patterns that may indicate money laundering. By leveraging advanced technologies and analytics, organizations can enhance their ability to detect and investigate potentially illicit transactions. Regular review and calibration of transaction monitoring systems are essential to ensure they remain aligned with emerging risks and regulatory expectations.

Enhancing AML Compliance Programs

Lessons learned from AML compliance cases stress the importance of continuously enhancing AML compliance programs to meet evolving regulatory standards. Organizations should maintain robust policies, procedures, and controls designed to prevent money laundering activities. This includes conducting thorough due diligence on customers, implementing effective know-your-customer (KYC) processes, and monitoring high-risk customers and transactions more closely.

Regular training and education programs for employees are essential to ensure a strong understanding of AML regulations and the identification of suspicious activities. By fostering a culture of compliance, organizations can minimize the risk of compliance failures and better protect themselves from potential penalties.

AML Enforcement and Regulatory Authorities

AML compliance cases highlight the significance of engaging with AML enforcement agencies and regulatory authorities. Organizations must cooperate fully during investigations and demonstrate a commitment to rectifying any identified compliance deficiencies promptly. Proactive engagement with authorities can help mitigate potential penalties and foster a cooperative relationship.

Keeping abreast of AML regulations and guidance issued by regulatory bodies is crucial. Organizations should regularly review and update their policies and procedures to align with the evolving regulatory landscape. Engaging with industry associations and participating in relevant forums can provide valuable insights into emerging trends, best practices, and regulatory expectations.

By learning from the experiences of others, organizations can strengthen their AML compliance programs, minimize the risk of money laundering activities, and maintain a strong reputation in the financial industry. Understanding the importance of risk assessments, transaction monitoring, and ongoing compliance enhancements is essential in navigating the complex world of AML regulations and mitigating potential risks.

Global AML Compliance Frameworks

The fight against money laundering is a global effort, with countries around the world implementing their own Anti-Money Laundering (AML) regulations. In this section, we will explore the AML regulations in the United States, the European Union, the United Kingdom, and Australia.

AML Regulations in the United States

In the United States, the most significant law in combating money laundering is the Bank Secrecy Act (BSA) of 1970. The BSA establishes compliance obligations for financial institutions, requiring them to implement AML programs and report suspicious activities to the appropriate authorities. Non-compliance with the BSA can result in penalties ranging from fines to imprisonment ( Unit21 ).

The USA PATRIOT Act, enacted after the 9/11 attacks, further strengthens AML regulations in the United States. It requires all banks and financial institutions to understand and comply with their AML obligations. Violating the USA PATRIOT Act can lead to significant penalties, including fines or imprisonment.

AML Regulations in the European Union

The European Union (EU) has also taken significant steps to combat money laundering by implementing Anti-Money Laundering Directives (AMLDs). These directives set out regulatory requirements that member states must follow to prevent money laundering and terrorist financing . The most recent directive, the 6th EU AMLD, was implemented in June 2021. It introduces stricter rules, increased criminal liability, and higher penalties and fines for money laundering offenses ( Unit21 ).

AML Regulations in the United Kingdom

In the United Kingdom, the primary AML regulation is the Proceeds of Crime Act (POCA). This legislation requires banks and financial institutions to implement robust anti-money laundering controls. Non-compliance with the POCA can result in penalties and fines. The UK government, along with regulatory authorities, continues to enhance AML regulations to keep pace with evolving money laundering risks and threats ( Unit21 ).

AML Regulations in Australia

Australia has implemented stringent AML regulations to combat money laundering and terrorist financing. The main legislation governing AML in Australia is the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (AML/CTF Act). This act requires regulated entities, including banks and financial institutions, to establish and maintain AML programs to identify and mitigate the risks of money laundering and terrorism financing. Non-compliance with the AML/CTF Act can result in penalties and legal consequences ( Unit21 ).

By having comprehensive AML regulations in place, these countries aim to prevent money laundering activities, disrupt criminal networks, and protect the integrity of their financial systems. Compliance with these regulations is crucial for financial institutions and other entities to mitigate the risks associated with money laundering and maintain the trust of their customers and stakeholders.

The Significance of AML Compliance

When it comes to combating money laundering, AML (Anti-Money Laundering) compliance plays a vital role in safeguarding the integrity of financial systems and preventing money laundering scandals. The consequences of AML compliance failures can be far-reaching, affecting not only financial institutions but also the overall stability of the global economy. In this section, we will explore the significance of AML compliance, including the prevention of money laundering scandals, the impact of compliance failures, and the need to update AML compliance programs.

Preventing Money Laundering Scandals

Money laundering scandals have had profound effects on financial institutions and the wider economy. Several high-profile cases serve as reminders of the importance of robust AML compliance programs. For example:

• Wachovia Bank allowed drug cartels in Mexico to launder close to USD 390 billion through its branches between 2004 and 2007, emphasizing the need for effective AML procedures in financial institutions like banks ( Sanction Scanner ).
• Standard Chartered Bank was fined $670 million for violating US sanctions against Iran and was later accused of failing in anti-money laundering controls that aided the Iranian government in avoiding U.S. regulations for $265 billion. The bank faced substantial fines from U.K. and U.S. authorities, totaling $1.1 billion, highlighting the significance of AML compliance programs in preventing money laundering.
• Danske Bank faced one of the largest money laundering cases when its Estonian branch allegedly facilitated illicit transactions totaling approximately $228 billion between 2007 and 2015. This case underscored the critical importance of robust AML compliance programs in preventing money laundering and led to substantial fines and accountability for several managers.
• Nauru, a small island country transformed into a tax haven, helped launder an estimated $70 billion for Russian criminals in 1998. This incident led to the U.S. Treasury designating Nauru as a money-laundering state and imposing severe sanctions, highlighting the significance of AML laws and regulations in preventing illicit activities like money laundering.
• The Bank of Credit and Commerce International (BCCI) engaged in fraudulent activities and money laundering totaling up to U.S. $23 billion, resulting in its closure in 1991. The BCCI case demonstrated the necessity for financial institutions to implement robust AML compliance frameworks to effectively combat money laundering and protect the integrity of the global financial system.

By emphasizing the significance of AML compliance, these real-life examples highlight the urgent need to prevent money laundering and the potential consequences of non-compliance.

Impact of AML Compliance Failures

Failure to comply with AML regulations can have severe repercussions for financial institutions. Regulatory authorities impose substantial fines and penalties as a deterrent against non-compliance. For instance:

• Westpac in Australia was fined $920 million in 2020 due to AML failings.
• In 2020, the US financial regulator FinCEN imposed a record $390 million fine on Capital One for violation of the Bank Secrecy Act and AML regulations.
• Deutsche Bank agreed to pay over $130 million in penalties to resolve AML allegations by US authorities in 2017.

These notable fines demonstrate the financial impact of AML compliance breaches and the importance of implementing robust AML programs to avoid penalties.

Updating AML Compliance Programs

AML compliance is an ongoing process that requires continuous evaluation and improvement. Lessons learned from AML compliance cases emphasize the need for financial institutions to update their AML compliance programs regularly. This includes conducting thorough risk assessments, implementing effective transaction monitoring systems, and keeping up with evolving AML regulations.

By staying up-to-date with the latest AML compliance practices, financial institutions can enhance their ability to detect and prevent money laundering activities. Regular updates to compliance programs ensure that institutions are equipped to address emerging threats and adapt to changes in regulatory requirements.

In conclusion, the significance of AML compliance cannot be understated. It plays a crucial role in preventing money laundering scandals, protecting financial institutions, and maintaining the integrity of the global financial system. By adhering to robust AML compliance programs, financial institutions can safeguard their operations, build trust with customers, and contribute to the collective effort to combat money laundering.

Identifying Suspicious Activities

To effectively combat money laundering, it is essential to be able to identify suspicious activities. This section will explore the definition and types of suspicious transactions, the process of reporting suspicious activities, and the role of Suspicious Activity Reports (SARs).

Definition and Types of Suspicious Transactions

Suspicious transactions are events or activities that raise concerns regarding their potential connection to illegal activities such as fraud, money laundering, terrorist financing, or other illicit purposes. However, it is important to note that what constitutes a suspicious transaction can vary based on the context. Here are some examples of red flags that may indicate suspicious transactions:

• Insufficient or suspicious information provided by customers during due diligence processes can be an indicator of potential money laundering or terrorist financing.
• Resistance from customers to comply with recordkeeping and reporting requirements mandated by Anti-Money Laundering (AML) regulations may signal an attempt to evade detection of illicit activities.
• Inconsistent business activities by customers, especially when transactions deviate from established or routine patterns, could indicate potential money laundering risks ( Lower Risk Group ).
• Abrupt and unexpected changes in a customer’s transaction patterns, such as the use of an unusual number of large denomination bills in cash transactions, should prompt further investigation as they may indicate money laundering.

It is vital for financial institutions and individuals working in compliance to be vigilant and aware of these red flags to detect and report suspicious activities promptly.

Reporting Suspicious Activities

Financial institutions have a legal obligation to monitor transactions, report suspicious activities, and file Suspicious Activity Reports (SARs) to combat money laundering, theft, tax evasion, and other forms of financial fraud. The reporting threshold for suspicious transactions may vary depending on the available evidence and level of suspicion.

When a potentially suspicious transaction is identified, it should be reported to the appropriate regulatory authorities. Financial institutions typically have dedicated teams or individuals responsible for investigating and reporting suspicious activities. These individuals should follow internal procedures and guidelines established by regulatory bodies to ensure compliance with AML regulations.

The Role of Suspicious Activity Reports (SARs)

A key tool in the fight against money laundering is the Suspicious Activity Report (SAR). A SAR is a document filed by financial institutions with the Financial Crimes Enforcement Network (FinCEN) or relevant regulatory authorities. SARs provide detailed information about suspicious transactions or activities that may indicate potential money laundering or other illicit activities.

The information contained in SARs helps regulatory authorities to analyze patterns, trends, and potential risks associated with money laundering. SARs play a crucial role in assisting law enforcement agencies in their investigations and contribute to the overall efforts to combat financial crime.

Financial institutions should ensure that their employees are trained to recognize and report suspicious activities appropriately. By staying informed about the latest typologies and red flags associated with money laundering, compliance professionals can play a vital role in detecting and preventing illicit financial activities.

In the next section, we will explore the lessons learned from real-life AML cases, including the importance of risk assessments, enhancing AML compliance programs, and the role of regulatory authorities in enforcing AML regulations.

Unlocking Success: Public-Private Collaboration Models in AML Revealed

What is Financial Crime?

Cracking the Code: AML Training Requirements Demystified

Empowering Professionals: AML Training Program Objectives Explored

Combatting Financial Crimes: AML Transaction Monitoring in Banking

The Rise of Blockchain: Enhancing AML Efforts in the Digital Age

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Published: 15 Jul 2020 Updated: 27 Jan 2023 Update History

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Defence against money laundering - daml, sars disclosures in civil litigation cases, red flag indicators, topical articles, resources/guidance, further icaew guidance.

This page brings together the latest guidance and a number of resources to help you decide when to submit a SAR and to increase the quality of the SAR.

A suspicious activity report (SAR) is a piece of information that alerts law enforcement of potential money laundering or terrorist financing. The UK Financial Intelligence Unit (UKFIU), sited within the National Crime Agency (NCA), receives, analyses and distributes the financial intelligence gathered from SARs. The information is then disseminated to law enforcement agencies who investigate and decide what further action to take. The SARs database is one of the largest source of financial intelligence available for UK enforcement.

If you suspect that money laundering may be taking place, you are legally obligated under the 2017 Money Laundering Regulations to submit a SAR to the National Crime Agency. A high quality SAR can provide crucial intelligence for law enforcement and can help to prevent a wide range of serious and organised crime and terrorist activities. Investigations are often based on multiple SARs, and although you may feel that your report in isolation does not provide much information, it could be the missing piece of a much larger puzzle.

Submit your SAR online via the NCA website . You’ll receive a confirmation email and your report will be processed in about five to seven working days.

The NCA specifically recommends that you submit your SAR electronically if you’re requesting a defence against money laundering (DAML).

• The New SAR Portal FAQs addresses frequently asked questions for organisations and individuals that submit SARs
• The New SAR Portal Overview (Guide A) provides an overview of the new SAR portal for organisations and individuals that use the portal to submit SARs
• The New SAR Portal: How to register (Guide B) provides guidance on how to register to the new SAR portal

As soon as you know or suspect a person is engaged in money laundering or dealing with criminal property you must submit a SAR.

You’ll need to decide whether you’ve formed a suspicion before you’re obliged to make a SAR. The threshold for suspicion is currently low. The leading test comes from R v Da Silva [2006] EWCA Crim 1654 . You have a reportable suspicion if you think there’s a possibility, which is more than fanciful, that the relevant facts exist. In Da Silva, it was noted that “a vague feeling of unease would not suffice”.

Factors to consider when deciding to make a report are included in Appendix D of Anti-money laundering guidance for the accountancy sector – the Treasury-approved official Guidance for accountancy firms.

If you are unsure, we as your AML supervisor can provide guidance. If you are an ICAEW member firm you could contact the technical and ethics helpline  or the anonymous AML helpline .

Once you’ve formed your suspicion, it’s good practice to document your reasons.

You can submit multiple SARs on the same issue as and when new information comes to light. Examples of SARs submitted by accountants that have resulted in action are available on the ICAEW website .

If you are unsure as to whether the privilege reporting exemption applies to your suspicion or confidentiality applies to your client relationship, read these articles on when to report, or not to report  and confidentiality .

A detailed SAR helps the NCA to quickly identify whether your client is a person of interest and to fill in existing intelligence gaps. The bulk of analysis focuses upon searches of key words in the free text so consider this in your typology. The data matching process relies on having basic quality standards of information:

• Data fields
• Include as much information as possible
• Dates of birth provide vital information for identifying individuals. Try and include as much identifying information as possible to include full name, gender, nationality, and address with postcode.
• Use the word ‘’UNKNOWN’’ if you are unable to complete a field. Do not leave it blank
• Try and complete the source type field
• If you have submitted previous SARs then include SAR reference numbers
• Reason for suspicion
• Limited to 8,000 characters; approximately 1,500 words
• Start with the glossary code. The SAR glossary codes are always prefixed with XX. The glossary code should be included in the reason for suspicion text space. You can use more than one glossary code. The NCA user guide for current glossary codes can be found here .
• Provide a brief summary to highlight key elements of suspicion
• Avoid acronyms and jargon
• Do not write in capitals. Limit the use of capitals to when punctuation requires, and use punctuation.
• Structure the report in a logical format
• If there is a large amount of information; break it up into manageable paragraphs
• Summarise your suspicion; chronologically
• Separate bank account/transaction information and use standard sort code account format 012345 12345678.
• Wherever you can try to answer the following questions; who? What? Where? When? Why? How?
• If you have other identifying information provide it here; for example occupation; car details; passport, NI number; telephone numbers.

ICAEW has set out some practical hints and tips for effective reporting .

ICAEW's anti-money laundering supervision team were joined by the National Crime Agency and other AML professionals for this live webinar event. The webinar discussed money laundering risks, SARs and the law, SARs and the role of the MLRO. It also featured case studies and a live Q&A.

• Watch the recording

SARs Q&A video

Following on from the Suspicious Activity Reporting webinar, Michelle Giddings, ICAEW Professional Standards' Head of AML, and Angela Foyle, Partner at BDO and Chair of the AML Committee of Accountancy Europe discussed some of the questions raised during the event.

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How ICAEW supervised firms deliver high value intelligence to law enforcement.

If a person has suspicion that property they intend to deal with is criminal in some way, and that by dealing with it, they risk committing an offence under POCA (2002), they can request a DAML.

The Government has published Circular 004/2021 ‘Money laundering: the confidentiality and sensitivity of suspicious activity reports (SARs) in the context of disclosure in private civil litigation. It sets out the Governments position on the use of SARS in private civil litigation matters and provides guidance to help protect reporters of SARs, the subject of SARs and the integrity of the SARs regime. Firms should consider how they can apply the guidance to protect themselves and to maintain the wider effectiveness of the SARs regime.

• Find out more about the guidance

Accountants should be alert to the following information on the NCA website:

Indicators of Modern Slavery and Human Trafficking in the accountancy sector

The government Flag it up campaign lists flags to be alert to when dealing with both new and existing clients:

• Transactions : Are transactions unusual because of their size, frequency or the manner of their execution, in relation to the client’s known business type?
• Structures : Do activities involve complex or illogical business structures that make it unclear who is conducting a transaction or purchase?
• Assets : Does it appear that a client’s assets are inconsistent with their known legitimate income?
• Resources : Are a client’s funds made up of a disproportionate amount of private funding, bearer’s cheques or cash, in relation to their socioeconomic profile?
• Identity : Has a client taken steps to hide their identity, or is the beneficial owner difficult to identify?
• Behaviour : Is the client unusually anxious to complete a transaction or are they unable to justify why they need completion to be undertaken quickly?
• Political Status: Is the client engaged in unusual private business given that they hold a prominent public title or function? Or do they have ties to an individual of this nature?
• Documents : Are information or documents being withheld by the client or their representative, or do they appear to be falsified?
• Geographical Area : Is the collateral provided, such as property, located in a high-risk country, or are the client or parties to the transaction native to or resident in a high-risk country?
• Choice of Professional : Have you, or other professionals involved been instructed at a distance, asked to act outside of your usual speciality, or offered an unusually high fee?

What to do if you suspect your client of furlough fraud

26 June 2020: Government schemes to ease the financial impact of the Coronavirus pandemic have been a lifeline for businesses. But with measures rushed in so quickly, some will inevitably take advantage.

COVID-19: Ethical issues for members in business

Technical helpsheet issued to help ICAEW business members to navigate some of the ethical issues that may arise during the COVID-19 pandemic.

Fraudulent COVID-19 claims: an ICAEW Chartered Accountant's responsibilities

Various government schemes have been put in place intended to provide financial support for businesses during the COVID-19 pandemic but are unfortunately open to abuse. Professional accountants are well placed to not only identify and report fraud, but in some cases to prevent it happening in the first place.

The Metropolitan Police shared crime indicators with the accountancy Professional Body Supervisors at a recent workshop.

• Read the crime indicators

The NCA website includes numerous publications on how to submit a SAR and what constitutes a good quality SAR. The link to their guidance page is shown below.

• Introduction to SARs
• There is also a UKFIU helpline for those submitting SARs or SAR online enquiries
• 020 7238 8282 – voicemail service
• Email [email protected]
• AML – the essentials, issue 20
• Suspicious Activity Reports – Thematic Review, guidance and information Access best practice guidance on procedures for reporting suspicious activities and staff training.
• SARS – Top tips for effective reporting
• SARs helpsheet
• Technical helpsheet which aims to help answer some common questions relating to tipping off
• Suspicious Activity Reports Case Studies

AMLbites: SARs

Watch our short training videos that cover some key topics around suspicious activity reporting.

Read out this code to the operator.

• August 23, 2022
• Latest News

Monitoring & Reporting Suspicious Activity Case Study

American multinational investment bank and financial services corporation Citigroup has been in the bad books of regulators for quite a few years now it seems. In 2019, the Bank of England imposed a record £44 million fine (which would have been £62.7 million, had Citigroup not agreed to resolve the matter) for persistent inaccurate reporting of its capital and liquidity levels. Moreover, the breaches of relevant requirements under the Prudential Regulations Authority (PRA) raised fundamental concerns about Citigroup and the effectiveness of its regulatory reporting control framework.

Operational lapses and regulatory reporting deficiencies whilst not limited to the UK, resulted in October 2020, with Citigroup being fined $400 million by the Federal Reserve and the Office of the Comptroller of the Currency because of their failures to implement and maintain an enterprise-wide risk management and compliance risk management program and falling short of regulatory expectations. Furthermore, prior to this specific fine, a Citigroup “error” resulted in a $900 million loan being paid back to lenders of a Citigroup client, with whom Citigroup is now pursuing legal action against some lenders who are refusing to return the payment. Note that this event prompted Citigroup to increase investment in its operational systems by $1 billion, to bring them up to par with regulations.

Fast forward to January 2022, and a Citigroup subsidiary in Hong Kong was fined $45 million for misconduct in its cash equities and several former senior managers are facing disciplinary proceedings. Finally in August 2022, the FCA has fined Citigroup $15 million for market abuse rule failings. This fine was a result of an 18-month investigation, that identified and assessed the specific market abuse risks Citigroup may have been exposed to. Significant gaps in its arrangements, systems and procedures were the outcome of years of failing to adequately monitor and report suspicious activity. Consequently, and in a bid to ensure that Citigroup meets regulatory requirements, an $11billion budget has been set aside for tech spending in 2022.

Whilst this proposed investment to ensure regulations are met is admirable, Citigroup and all financial institutions should remember that keeping the financial market “clean” and safe for investors is a primary objective of the UK regulator.  In order to be able to comply with the requirements of the Market Abuse Regulations (MAR), it is very important to ensure that trade surveillance of a firm’s dealings is supported by the appropriate arrangements, systems, and procedures.

Anti-Financial Crime Support – How can Complyport Help?

Our experienced  Financial Crime and Forensics team  led by  Martin Schofield —one of the world’s leading specialists in the field—brings a wealth of experience to every project we are engaged in. Our highly experienced financial crime professionals and forensic experts, in subjects such as anti-money laundering, counter terrorist financing, anti-bribery and corruption and fraud and regularly help our clients navigate the complexities of the financial crime and money laundering environment. Services offered by Complyport include:

• AML/Fraud policy & training reviews,
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• Financial crime health checks and audits,
• Implementation of financial crime, AML, CTF, ABC, Fraud and market abuse controls and frameworks,
• Ongoing advice on financial crime, AML, CTF, market abuse and fraud prevention,
• Authoring/reviewing financial crime policies,
• Outsourced MLRO support
• Outsourced KYC and CDD support,
• Assistance in identifying Politically Exposed Persons (PEPs),
• Assistance in navigating international sanctions,
• Support with preventing market abuse and insider dealing,
• Expert Witness in Financial Crime cases
• Forensics and Investigations
• Design and/or delivery of online or face to face financial crime training

If this article has raised any questions, or you think your firm may require assistance, please contact either Martin Schofield via  [email protected] or Jan Hagen via [email protected]  to book in a free consultation.

About Complyport

Complyport is the City’s market leading consulting firm supporting the UK financial services industry for over 20 years. We specialise in providing Governance, Risk and Compliance services to support the regulated financial services industry to raise standards and thrive.

Complyport advises and assists firms to become authorised and to comply with the rules and requirements of regulators on an ongoing basis. Our vision is to be there for our clients every step of the way, helping them change, grow, and excel through expertise, insight, and innovation, and in so doing to become our clients’ most valued supplier and trusted advisor.

With presence in the UK and EU, as well as via our Associates Network, Complyport can assist firms across multiple jurisdictions.

Complyport’s multidisciplinary consultants possess deep expertise in their field, having acted in FCA skilled person reviews, as expert witnesses in legal cases and as expert investigators for firms or their legal advisers.

Day to day, we conduct audits and reviews of a firm’s products, processes, policies, and procedures to identify scope for business, to determine the impact of regulatory developments and to verify compliance with local regulations. Complyport can also assist firms by providing personnel to cover all the key compliance functions including resourcing individuals to be registered as your Compliance Oversight Function (SMF16) and/or Money-Laundering Reporting Officer (SMF17).

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Writing a useful SAR narrative

Beginning with this post we will periodically be revisiting essential AML compliance topics. Refreshing the fundamentals and AML priorities helps us stay focused and able to absorb new ideas and trends.

Writing useful narratives for Suspicious Activity Reports (SARs) can often be a struggle. When there are many transactions, involving multiple parties, over a long time period, putting together a clear explanation of the facts can be challenging. Part of the challenge is providing clarity to the mountain of information gathered during the investigation; another is recognizing that the narrative is being written for an outside audience: analysts and investigators at law enforcement agencies.

So how do we take all the pieces of the transaction puzzle and create a clear picture for the reader? We go back to the basics; we use the 5 W’s and the H – who, what, when, where, why, and how.  Think back to when you learned to write a simple composition conveying the facts of a story. You started with an introduction , then the body of the story, and ended with a conclusion . This tried and true formula is exactly how to write a useful SAR narrative, essential for AML success.

In preparing the introduction to the narrative, try to answer this question, “why should the reader care about this and find value?”. Centering your composition around this will help you state clearly what the reader should look for in the body of the story. The reader will care about the story if you tell them what type of activity you are writing about and summarize the “red flags” for suspicious activity you have observed. It is also useful to state the date(s) of any previous SARs filed about this activity (if any) and any internal investigation designations to which law enforcement may refer, if they contact your institution.

When developing the body of the narrative, use the news writing technique of the inverted pyramid . Put the important information at the beginning and less important facts toward the end. The website DailyWritingTips illustrated the concept this way:

In the body you should clearly lay out the who, what, when, where, why, and how. In this section, try to keep in mind the question, “how do I get straight to the point?”. When telling the details of the story be specific; if you are discussing a withdrawal, include the form it took, e.g. cash, money order, cashier’s check, etc. Summarize the flow of funds in the transactions; where the money came from and where it went. When referring to dates, tie them to individual transactions rather than giving a range.

Be sure to cover all of the parties in the transactions and the relationships among them; include detailed information about all of the financial institutions and account parties that have been identified in your investigation – the who. Include complete information about the accounts and branches involved, along with the source of all funds, and dates of all transaction. Also take mind to lay out the information with specific amounts and related dates – the what, the when, and the where . Discuss the sequence of the activity and the channels used to move funds – the how. Finally, speak to any relationships you have identified among the parties to the transactions and what you think is going on or why the activity is suspicious – the why .

In drafting the conclusion, reiterate why you have concluded that the activity is suspicious and tell the reader what other actions your institution is taking (e.g. are you closing the account? or increasing the level of monitoring on the account?).

A useful SAR narrative should allow a reader who has not been immersed in the investigation and the facts it has revealed to understand the story and grasp its essence. (On a side note, you might find a new appreciation for the hard work that your 6 th grade English teacher put in to helping you become a better writer.) Either way, it will serve as an effective summary of all of the work that you have done investigating the activity to date. Most importantly, it may lead to a successful prosecution of financial crimes.

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What is SAR Report?

When financial institutions detect unusual behavior that could signal potential money laundering or fraud, they turn to Suspicious Activity Reports (SARs) to initiate a closer examination. SARs are crucial components of anti-money laundering (AML) and counter-terrorist financing (CTF) efforts, serving as an early warning system to flag transactions that deviate from normal patterns. In fact, recent data reveals that over 1.5 million SARs were filed in the U.S. alone in the past year, underscoring the vital role these reports play in combating financial crime. 

What is a  Suspicious Activity Report (SAR) ?

A Suspicious Activity Report (SAR) is a document filed to track suspicious activities and to inform regulatory bodies about them by related institutions. The Bank Secrecy Act (BSA) of 1970 introduced the Suspicious Activity Report (SAR) as a crucial tool for overseeing and identifying suspicious activities and criminal activity not typically highlighted in other reports, such as the currency transaction report. In 1996, the SAR report emerged as the standardized form for reporting suspicious activity to defend against money laundering. 

When to File a SAR Report 

SAR Report must be filed when a financial institution or individual suspects a customer is involved in suspicious or potentially criminal activities, such as money laundering, terrorism financing, or other illegal activities. The SAR should be filed as soon as possible after the suspicious activity is detected, typically within 30 days, to comply with reporting requirements set by regulatory agencies such as the FinCEN.

Companies must raise SAR when they detect one of the following:

• Extremely high-value deposits
• Unusual transactions in terms of sender, receiver, location, and volume
• High-value transactions across countries
• Abnormal customer behavior
• Non-commercial transactions

What Can Be Considered a Suspicious Activity?

Suspicious activities are defined by specific values in currency, known as thresholds of currency. In the United States, the Financial Crimes Enforcement Network (FinCEN) sets these thresholds for national US banks and international banks operating under the jurisdiction of the Office of the Comptroller of the Currency (OCC) . These definitions, while specific to US banks, give a general idea of the types of activity that qualify as suspicious.

According to the OCC, an SAR (Suspicious Activity Report) must be required with FinCEN in certain circumstances, such as: 

• If insider trading abuse is suspected,
• If a violation involving $5,000 or more is identified,
• If a violation involving $25,000 or more is detected, regardless of the suspect.

Additionally, transactions that violate the Bank Secrecy Act (BSA) or are intended to evade existing regulations must also trigger a SAR filing and can be seen as suspicious activity. In general, reasonable suspicion is considered a reasonable possibility that relevant evidence exists, and a "vague feeling of unease" would not be sufficient.

Common Patterns of Suspicious Activity

The observed patterns of suspicious activity encompass various indicators that may signal potential illicit financial behavior and criminal activity. These include:

What Institutions Need to be Aware of Suspicious Activity Reports?

• Institutions such as banks, financial establishments, and other entities handling large sums of money need to be acutely aware of suspicious activity reports. These reports are crucial for the detection and prevention of illegal activities such as money laundering, fraud, and terrorism financing.
• To effectively identify and report suspicious activity, institutions must have a thorough understanding of the types of red flags that may indicate criminal behavior. This can include unusual transactions, inconsistencies in customer information, and high-risk activities that deviate from normal behavior patterns.
• Institutions need to have robust anti-money laundering and compliance programs in place to ensure that they are equipped to properly identify and report suspicious activity. This includes training staff to recognize red flags, implementing strict monitoring procedures, and staying up-to-date on regulatory requirements.
• By being vigilant and proactive in reporting suspicious activity, institutions play a critical role in safeguarding the financial system and protecting their customers from potential harm. Failure to report suspicious activity can result in severe consequences, including hefty fines and damage to reputation. Therefore, institutions need to prioritize compliance and ensure that they are actively working to combat financial crime.

What is a Bank SAR Report?

A Bank Secrecy Act Suspicious Activity Report (BSA-SAR) is a report filed by financial institutions to report potential money laundering or other suspicious activities to the FinCEN of the U.S. Department of Treasury. Banks and other financial institutions are legally required to monitor their customers' transactions and report any suspicious activity that may indicate money laundering, fraud, terrorism financing, or other illegal activities.

Suspicious Activity Report in Transaction Monitoring

Transaction Monitoring also has an important place for Suspicious Activity Reports. Transaction Monitoring responds to companies' AML (Anti-Money Laundering), CFT (Counter-Financing of Terrorism) , and KYC (Know Your Customer) requirements. Transaction monitoring generates an alarm for suspicious situations and suspicious activities. When the software issues an alarm, the transaction is automatically stopped, and the transaction is reviewed in detail by the Firm's Compliance or Risk Department. At this point, if the SAR comes into play and detects crime in the customer transaction, the suspicious transactions report to the AML, CFT, and KYC regulators.

Suspicious Activity Reporting Process

Suspicious Activity Reports are a tool provided by the BSA of 1970. SARs allow governments to identify and analyze trends and patterns that arise in a wide range of personal and organized crime. With this information, they can predict and resist fraudulent and criminal behavior before gaining a place. Even though most SAR reports come from the financial sector, institutions such as law enforcement, public safety workers, and business owners also submit a SAR  report. Federal law requires that a financial institution and its managers, officers, employees, and agents reporting suspicious or known criminal violations or suspicious activities not report to any person reporting the transaction.

SAR Report Requirements

The following information sections are required to submit a SAR file:

• Information such as the names, passport numbers , birth dates, addresses, social security numbers, and phone numbers of all parties related to the suspicious event is collected.
• Dates of suspicious events that took place and documentation of suspicious activity codes are required.
• Contact information is required for the financial institution and the institution where the auspicious event took place.
• A written description of the suspicious activity event is developed.

According to NCA , every single suspicious activity must be reported immediately in regulated sector companies under  Part 7 of the Proceeds of Crime Act 2002 (POCA) and the Terrorism Act 2000. However, if a company in a different sector detects an abnormality that suspects money laundering, criminal property, or any kind of financial crime, it must raise SAR, too.

When is a Suspicious Activity Report Required?

The requirements for filing a SAR can differ based on jurisdiction and industry specifics. In the United States , the FinCEN sets clear guidelines for when SARs must be filed:

• Financial institutions are required to file a SAR when they identify activities that may suggest money laundering or breaches of the BSA.
• If there's suspicion that an employee is involved in illicit activities or internal fraud, a SAR must be reported.
• The detection of customers engaging in activities related to unlicensed money services businesses also triggers the need for a SAR.

Who Can Report Suspicious Activity?

SAR report is made by a financial institution that observes suspicious activity in an account. The suspicious activity report is sent to NCA in the UK, which is investigating the incident. The financial institution can report within 30 days of any account activity they deem suspicious or unusual, and a 60-day extension can be obtained to gather more evidence as needed. Financial institutions should keep a copy of the SAR report for five years. Failure to comply with any of these regulations may result in civil and criminal penalties, including significant fines, legal restrictions, loss of banking contracts, and even prison terms. Total monetary settlements collected by regulatory agencies and law enforcement agencies for money laundering , sanctions, and tax evasion.

How Confidential Are Suspicious Activity Reports?

The Suspicious Activity Report's effectiveness depends on these reports' extreme confidentiality because they contain customers' confidential personal information and potentially have significant legal consequences. The person under investigation is never informed about the pending report. Similarly, discussions with third parties like media companies are a federal crime. When a bank or financial institution submits a SAR file, the information provided is reviewed by financial researchers, management staff, and lawyers before concluding the SAR. As a result. Special privileges are given to protect those who submit SARs as part of a company or alone; for example, people who submit SARs do not need to disclose their organization's name.

How Do You Submit a Suspicious Activity Report?

Since 2012, all Suspicious Activity Report (SAR) filings must be processed through FinCEN's BSA e-file system. This system increases efficiency and ensures uniformity in the information provided, especially in cases where public safety is at risk. Reporters need to provide information in five key sections when submitting a SAR. Initially, they gather all involved parties' names, addresses, social security numbers, birth dates, occupations, and contact numbers. Following this, documentation of incident dates and codes for the suspicious behavior is required. Subsequently, information about the financial institution where the activity transpired, including contact details, must be provided. Lastly, a written account describing the suspicious activity is drafted to complement the data.

Where Can I Find SARs Forms?

The standard SAR form is accessible through the BSA e-file system. However, some various online guides and resources aid financial professionals, legal experts, and individuals in understanding the intricacies of the reporting process.

The Current State of SAR Filings

In January 2022, the number of SARs filed exceeded any other month on record, showing an increase compared to January 2021 and 2020. Additionally, in 2021, the number of SARs filed surpassed 3 million for the first time, and it is projected to reach 3.5 million by the end of 2022. Depository institutions, such as banks and credit unions, account for 45% of all SARs filed, while money services businesses file around 40%. Out of the 90 different categories of suspicious activity that can be reported, two stand out: "transactions below the BSA threshold" were used by MSBs 50,142 times and by depository institutions 34,057 times.

How Can Sanction Scanner Help

As a leading AML compliance Regtech , Sanction Scanner offers a Transaction Monitoring tool to detect suspicious activities of your customers or individuals using your financial services. The product monitors every activity that your company mediates, and its machine-learning algorithm detects suspicious attempts. On the other hand, it allows you to create your own rules and rule sets and create your own scenarios according to your company's risk appetite, size, sector, etc. The rules can be adjusted for different customer groups according to their risk levels. After setting up, AML Transaction Monitoring software watches the activities of customers for your compliance team and notifies them if it detects a suspicious transaction and suspicious activity by real-time alerts. If you want to know more about our solution, you can contact us or request a demo of the product.

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Efficiency of money laundering countermeasures: case studies from european union member states.

1. Introduction

2. literature review, 3. methodology, 4.1. suspicious transaction reported and other information relevant to money laundering, 4.2. case studies resulting from suspicious transaction analysis, 4.2.1. description of money laundering cases, 4.2.2. examples of cases, professionals working for criminals, business e-mail compromise (bec) fraud, use of new payment methods, cyber fraud, illegal virtual money changer, 4.3. tthe results of fius analyses dissemination, 5. discussions, 5.1. discussion regarding str, 5.2. discussion about case studies, 5.3. discussion about information and cases disseminated to competent authorities, 6. conclusions, author contributions, data availability statement, acknowledgments, conflicts of interest.

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Cotoc, C.-N.; Nițu, M.; Șcheau, M.C.; Cozma, A.-C. Efficiency of Money Laundering Countermeasures: Case Studies from European Union Member States. Risks 2021 , 9 , 120. https://doi.org/10.3390/risks9060120

Cotoc C-N, Nițu M, Șcheau MC, Cozma A-C. Efficiency of Money Laundering Countermeasures: Case Studies from European Union Member States. Risks . 2021; 9(6):120. https://doi.org/10.3390/risks9060120

(Bodescu) Cotoc, Corina-Narcisa, Maria Nițu, Mircea Constantin Șcheau, and Adeline-Cristina Cozma. 2021. "Efficiency of Money Laundering Countermeasures: Case Studies from European Union Member States" Risks 9, no. 6: 120. https://doi.org/10.3390/risks9060120

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Journal of Money Laundering Control

ISSN : 1368-5201

Article publication date: 12 November 2020

Issue publication date: 31 July 2021

Against a backdrop of money laundering scandals in the banking industry, this study aims to assess anti-money laundering (AML) reporting obligations of bankers in the UK. By evaluating the effectiveness of the current suspicious activity report (SAR) regime, this study seeks to use the senior management functions of the Senior Managers and Certification Regime (SMCR) to achieve the goals of AML law within the banking sector.

Design/methodology/approach

This study firstly evaluates the efficiencies of the available risk-based sanctions aimed at making the banks the gatekeeper for money laundering. It points out the three-fold deficiencies of the SAR regime in the UK. Lastly, it discusses and examines the merits of multiple proposals for reformation.

It is argued that the risk-based sanctions have failed to achieve their goals to deter banks from abusing their products and services to facilitate money laundering activities. In revealing the three-fold deficiencies of the SAR regime – theoretical flaws, practical inapplicability and institutional culture – this study argues for both the retainment of the current regime and the repositioning of regulation focus on the reformation of institutional culture, particularly within large or multinational corporates, in terms of their commitment to fulfilling AML obligations.

Originality/value

This essay has concluded that the regime has correct tools under the Proceeds of Crime Act 2002, the Money Laundering Regulations 2017 and the SMCR to address problems associated with AML reporting obligations imposed on the banking sector.

• Banking industry
• AML reporting obligations
• Anti-money laundering (AML)
• Senior management functions of the Senior Managers and Certification Regime

Loh, X. (2021), "Suspicious activity reports (SARs) regime: reforming institutional culture", Journal of Money Laundering Control , Vol. 24 No. 3, pp. 514-524. https://doi.org/10.1108/JMLC-07-2020-0078

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The Financial Crimes Enforcement Network (FinCEN) is issuing this advisory to inform and assist the financial industry in reporting suspected instances of trade-based money laundering. 1 This advisory contains examples of "red flags" based on activity observed in Suspicious Activity Reports (SARs) that may indicate trade-based money laundering. While SARs are not proof of illegal activity, they can provide law enforcement with valuable indicators that this type of money laundering may be occurring. The examples discussed in this advisory are based on specific law enforcement experience involving U.S. trade with Central and South America, but the types of activity detailed herein are by no means confined to those regions, and financial institutions are advised to take appropriate measures to mitigate the risks of analogous activity occurring globally.

Criminal organizations use the international trade system to transfer value across international borders and disguise the illicit origins of criminal proceeds. According to the 2009 International Narcotics Control Strategy Report (INCSR), it is estimated that the annual dollar amount laundered through trade ranges into the hundreds of billions. 2 Additionally, U.S. Immigration and Customs Enforcement (ICE) reports that their trade-based money laundering case initiations have increased since 2004. 3 The Financial Action Task Force (FATF) 4 names trade-based money laundering as an increasingly important money laundering and terrorist financing vulnerability. FATF lists the physical movement of goods through the trade system as one of three methods criminal organizations and terrorist financiers use to move money for the purpose of disguising its origins and integrating it into the formal global economy. 5 Illicit activity is often hidden, due in part to the enormous volume of international trade transactions (an estimated $15.7 trillion in global merchandise exports in 2008). 6

Trade-based money laundering typologies such as black market exchange systems have evolved in response to government efforts to close vulnerabilities in the international financial and trade systems. For example, the efforts of the U.S. Government to restrict the domestic placement of illicit cash have led to an exponential increase in cash smuggling from the United States, especially into Mexico. After drug proceeds are smuggled into Mexico as bulk cash, Mexican Drug Trafficking Organizations (DTOs) use a portion of these proceeds to settle drug debts or purchase future drug shipments from Colombian DTOs. Some of the bulk cash may eventually make its way into the formal financial sector in Mexico, notwithstanding the positive and continuing efforts of the Mexican government and Mexican financial institutions to develop and implement anti-money laundering and countering the financing of terrorism (AML/CFT) safeguards. The funds can then be co-mingled with legitimate proceeds at these financial institutions and then used to fund wire transfers to countries such as China, Panama and the United States. The funds are used to purchase goods that are later sold on the black market. 7

Trade-based money laundering methods vary in typology from the most basic to very complex schemes. Basic schemes include misrepresenting the price and quantity of goods and services (over and under invoicing), and invoicing the same goods or services more than once (double invoicing). 8

The Colombian Black Market Peso Exchange (BMPE) is an example of a complex method of trade-based money laundering. The BMPE originally was driven by Colombia's restrictive policies on currency exchange. To circumvent those policies, Colombian businesses bypassed the government levies by dealing with peso brokers that dealt in the black market or parallel financial market. Colombian drug traffickers took advantage of this method to receive Colombian pesos in Colombia in exchange for U.S. drug dollars located in the United States. 9 According to the U.S. State Department's 2007 INCSR, similar black market exchange systems are found in Venezuela and in the tri-border region of Argentina, Brazil, and Paraguay. 10 The U.S. State Department also reports that trade goods in Dubai as well as Chinese and European manufactured trade items are being purchased through narcotics-driven systems similar to the BMPE. 11

Black market currency exchange systems have evolved in part due to increased diligence by U.S. financial institutions. In the past, a common method used for initial placement of illicit funds into the financial system was structured deposits in the form of cash, money orders or other financial instruments. Today, money launderers are employing diversified methods such as utilizing individuals or businesses that have control over numerous bank accounts, often spread over multiple financial institutions, and bulk cash smuggling from the United States. The smuggled U.S. dollars are deposited into foreign institutions - often in Mexico, but also in Central and South American countries - and wired back to the United States and other prominent trade countries as payments for international trade goods and services.

SAR filings on suspected TBML are increasing; 12 however, it can be difficult to identify these activities given that financial institutions see only the documents related to a transaction and not the goods themselves. Further, documents related to trade-based money laundering may be created by the money launderers themselves with no neutral third party to verify the validity of the documents.

Potential Indicators of Trade-Based Money Laundering

FinCEN and the National Drug Intelligence Center (NDIC), with input from ICE's El Dorado Task Force, 13 have identified the following activities that may be associated with trade-based money laundering. These red flags may be directly linked to a misrepresentation of price, quantity or quality of merchandise involved in a trade transaction processed through a financial institution. Although the activities from this study were specifically focused on trade with Mexico and Central and South America, financial institutions may wish to apply these indicators more globally. None of the country-specific examples included in this advisory, however, should in any way be interpreted with any implication to the hundreds of billions of dollars in legitimate trade transactions conducted every year between the United States and Mexico or Central and South America. 14 Also, please keep in mind that this list of red flags identifies only possible signs of illicit activity and must be considered in conjunction with the normal transaction activity expected for the individual customer. In particular, any of the following red flags seen in conjunction with shipments of high dollar merchandise (such as electronics, auto parts and precious metals and gems) to duty free trade zones, such as in the Colon Free Trade Zone in Panama, could be an indication of a trade-based money laundering or black market peso exchange activity:

Third party payments for goods or services made by an intermediary (either an individual or an entity) apparently unrelated to the seller or purchaser of goods. This may be done to obscure the true origin of the funds.

Amended letters of credit without reasonable justification.

A customer's inability to produce appropriate documentation (i.e., invoices) to support a requested transaction.

Significant discrepancies between the descriptions of the goods on the transport document (i.e., bill of lading), the invoice, or other documents (i.e., certificate of origin, packing list, etc.).

Other potential red flags for trade-based money laundering or black market peso exchange activities include:

Negotiable instruments (such as traveler's checks, cashier's checks and money orders) in round denominations under $3,000 used to fund domestic accounts or, alternatively, smuggled from the United States for placement into accounts at foreign financial institutions. The negotiable instruments may be sequentially numbered or purchased at multiple locations and may frequently lack payee information or contain visible broker markings or symbols. These negotiable instruments may also be used to pay for goods and services.

International wire transfers received as payment for goods into U.S. bank accounts or processed through U.S. correspondent or intermediary accounts, especially where the ordering party (importer of goods) of the wire does not live in the country from which the wire originated. For example:

• Wires originating from jurisdictions which have been highlighted in relation to black market peso exchange activities, such as Mexico, Guatemala, Argentina, Brazil, Paraguay, Uruguay, Venezuela;
• Payment destinations that include United States, Hong Kong, China, South Korea, Taiwan, Spain, Panama, Curacao, as they relate to duty free trade zones;
• Wires where no apparent business relationship appears to exist between the originator and the beneficiary;
• Customers who fail to provide adequate information, including adequate information on the originator, beneficiary, and purpose of the wire; or
• Frequent transactions involving rounding or whole dollar amounts.

Funds transferred into U.S. domestic accounts that are subsequently transferred out of the account in the same or nearly the same amounts. Origination and destination locations are frequently high risk jurisdictions.

Sudden onset and equally sudden cessation of payments - typically wire transfers - within a short duration. This could be an indication that the account is temporarily being used to launder illicit proceeds.

A foreign import business with U.S. accounts receiving payments from locations outside the areas of their customer base.

U. S. companies operating out of foreign countries, especially when it is difficult or impossible to determine ownership or controlling persons for the company, or when the business purpose is not fully apparent.

Unusual deposits occurring in combination with one or more of the following indicators:

• Multiple deposits occurring in various locations when the account owner resides elsewhere, for example, deposits made in New York and Michigan when the account owner resides in Florida.
• A customer with multiple bank accounts, or multiple accounts held by the customer and closely related family members. These accounts may be held at one or more financial institutions. Such accounts may be used to facilitate the placement and layering of illicit funds.
• Checking accounts receiving cash deposits in amounts under $1,000 as infrequently as several times per month. These deposits may be followed by ATM withdrawals in foreign countries. This method, sometimes referred to as micro-structuring, is used by "smurfs" 15 to deposit cash which may then be used to purchase goods.

Foreign visitors opening multiple U.S. bank accounts at one or more financial institutions. Individuals may travel to the United States with instructions to establish multiple bank accounts as a straw party. Upon return to their home country the straw account owner signs all of the blank checks and relinquishes control of the checkbooks and ATM cards tied to the accounts to the beneficial owner who now has control of the accounts. The following are examples of activity common to these accounts:

• Cash deposits received using over-the-counter deposit slips since the checkbooks containing the pre-printed deposit slips as well as ATM cards are located out of country;
• Deposits which are frequently made in multiple U.S. jurisdictions;
• Withdrawals made via foreign ATM transactions; or
• Withdrawals via check transactions that exhibit a difference between the handwriting for the signature and the payee portions of the check.

Unusual activity in established U.S. bank accounts for non-resident aliens, such as structured cash and monetary instrument deposits; checks written from the U.S. account to foreign businesses with no apparent relationship to the account holder; and international wire transfers to entities that do not appear to have any relationship with the originator.

Currency Transaction Reports (CTRs) generated for accounts having multiple cash deposits in a single day. Depository institutions should be particularly aware of cash deposits occurring in multiple branch locations, including those located in different states.

Sequentially numbered checks drawn on U.S. accounts negotiated through foreign money services businesses, for example, casas de cambios . Some checks may be payable directly to casas de cambios instead of specific businesses or individuals.

It is important to remember that no one activity by itself is a clear indication of trade-based money laundering. Due to some similarities with legitimate financial activities, financial institutions should evaluate indicators of potential trade-based money laundering in combination with other red flags and expected transaction activity for its customer before making determinations of suspiciousness. Additional investigation and analysis may be necessary to determine if the activity is suspicious, based on information available to the financial institution. Further information on trade-based money laundering, and related SAR filings, can be found in Appendix A.

Suspicious Activity Reporting

In order to assist law enforcement in its effort to target trade-based money laundering and black market peso exchange activities, FinCEN requests that financial institutions check the appropriate box in the Suspicious Activity Information section of the SAR form and include the abbreviation "TBML" 16 or "BMPE" 17 in the narrative portion of all relevant SARs filed. The narrative should also include an explanation of why the institution suspects, or has reason to suspect, that the customer is participating in this type of activity.

Financial institutions with questions or comments regarding this Advisory should contact FinCEN's Regulatory Helpline at 800-949-2732.

Trade-based Money Laundering Magnitude as Reported in SARs

SAR filings on suspected TBML are increasing; 18 however, it can be difficult to identify these SARs. Filers clearly identified the activity as TBML or BMPE in only 24 percent of the SAR narratives analyzed in conjunction with this advisory. The remaining 76 percent of the SARs potentially associated with TBML required complex queries that included trade and other terms derived from the red flags identified in this Advisory (see Figure A).

While SAR filings related to trade-based money laundering are increasing, the activity dates reported on the SARs indicate there is a substantial interval between when the activity occurs and when it is identified and reported. This could indicate that financial institutions are first becoming aware of such activity through law enforcement inquiries or media reports, or through other suspected illicit activities involving their customers which may be identified through open sources. For example, based on the SARs retrieved in conjunction with this advisory, 14 percent of the suspected TBML activity that occurred in 2004 was reported in 2004, while 30 percent of the 2004 activity was not reported until the first half of 2009, five years after the activity occurred. Figure B provides a comparison of SAR filing dates to the dates when the TBML activity occurred.

Analysis of SARs identified as reporting TBML activity have revealed trends that may be valuable to law enforcement with regard to resource allocations. Transactions involving entities in Mexico and China 19 were the most frequently named in SAR narratives reporting TBML activity. However, over the four year period from 2004 to 2008, TBML SAR narratives involving transactions in China continued to increase while narratives citing a connection to Mexico were beginning to decrease. Panama was ranked third in the total number of SAR narratives describing suspected TBML possibly due to activity in the Panama Colon Free Trade Zone. Analysis of the change in frequency of countries reported in TBML SARs between 2004 and 2007 20 revealed that the Dominican Republic, followed closely by Venezuela, are the countries with the most rapid growth in potential TBML activity.

1 In developing this advisory, FinCEN examined the illicit use of trade operations and related activities, such as disguising the proceeds of criminal activity through the use of trade transactions, including misrepresentation of the price, quantity and quality of imports or exports.

2 2009 International Narcotics Control Strategy Report, Volume II: Money Laundering and Financial Crimes, February 27, 2009, http://www.state.gov/p/inl/rls/nrcrpt/2009/vol2/116537.htm .

3 The relationship, if any, between this increase and the allocation of ICE resources dedicated to the detection and investigation of TBML is unknown.

4 The FATF is a 35 member inter-governmental policy-making body whose purpose is to establish international standards, and develop and promote policies, both at national and international levels, to combat money laundering and terrorist financing. See http://www.fatf-gafi.org . The United States is a member of the FATF.

5 According to FATF, the other two methods used by criminal organizations and terrorist financiers to move criminal proceeds and integrate them into the formal economy are use of the financial system and physical movement of money (e.g. through the use of cash couriers). See the Financial Action Task Force, "Trade Based Money Laundering," Executive Summary, June 23, 2006, http://www.fatf-gafi.org/dataoecd/60/25/37038272.pdf .

6 "International Trade Statistics, 2009," World Trade Organization, October 28, 2009, http://www.wto.org/english/res_e/statis_e/its2009_e/its09_toc_e.htm .

7 "The Consolidation and Flow of Bulk Cash by Mexican Drug Trafficking Organizations," the U.S. Department of Justice, National Drug Intelligence Center, November, 2009.

8 See the Financial Action Task Force Report, "Trade Based Money Laundering," Executive Summary, June 23, 2006, http://www.fatf-gafi.org/dataoecd/60/25/37038272.pdf .

9 Black market peso exchange facilitates the "swap" of dollars owned by drug cartels in the United States for pesos already in Colombia, by selling the dollars to Colombian businessmen who are seeking to buy United States goods for export. See FinCEN Advisory Issue 9, Colombian Black Market Peso Exchange, November, 1997. See also the "2007 National Money Laundering Strategy," Chapter 6, Trade-Based Money Laundering, http://www.treasury.gov/resource-center/terrorist-illicit-finance/Documents/nmls.pdf .

10 2007 International Narcotics Control Strategy Report, Volume II: Money Laundering and Financial Crime, March 2007, http://www.state.gov/documents/organization/81447.pdf .

11 See the U.S. Department of State, "International Narcotics Control Strategy Report," March 2008, http://www.state.gov/p/inl/rls/nrcrpt/2008/vol2/html/101353.htm .

12 Over 17,000 SARs reporting potential TBML activity that occurred between January 2004 and May 2009 reported transactions that involved in the aggregate over $276 billion. While FATF's 2006 Report on Trade Based Money Laundering reported few instances of trade-related activities in suspicious activity reports, FinCEN explored a broader spectrum of trade operations and related activities in developing this advisory.

13 ICE's El Dorado Task Force consists of members from more than 55 law enforcement agencies in New York and New Jersey working in partnership to target vulnerabilities and financial crimes in the New York/New Jersey metropolitan area, such as commodity-based money laundering.

14 "U.S. International Trade in Goods and Services, November 2009," U.S. Bureau of Economic Analysis, U.S. Department of Commerce, January 12, 2010, http://www.census.gov/foreign-trade/Press-Release/current_press_release/ft900.pdf .

15 "Smurfs" are teams of persons who, acting in conjunction with or on behalf of other persons, structure financial transactions for the purpose of evading the requirement to file a Currency Transaction Report. "Structuring" as the term is used in the BSA includes not only attempts to evade reporting requirements, but also attempts to evade the Travel Rule and related recordkeeping requirements at 31 CFR 103.33. See 31 USC 5324.

16 Trade-based money laundering (TBML)

17 Black Market Peso Exchange (BMPE)

18 Over 17,000 SARs reporting potential TBML activity that occurred between January 2004 and May 2009 reported transactions that involved in the aggregate over $276 Billion.

19 Narrative searches for China included Taiwan and Hong Kong.

20 As noted in Figure B, there is a lag time between when the activity occurs and when filers identify and report the activity as suspicious. For this specific reason, 2007 data was used to calculate the percentage of change as 2007 data appears to be more complete than 2008.

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Secretory Carcinoma of the Thyroid: A Case Report and Update of Literature

• Case Report
• Published: 22 September 2024
• Volume 18 , article number  84 , ( 2024 )

Cite this article

• Ying-Hsia Chu 1 ,
• Bassim Kobrossy 2 ,
• David Schwartz 3 ,
• Alan D. Bruns 4 &
• Julie Marsh 5  

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Primary secretory carcinoma (SC) of the thyroid gland is a rare neoplasm, characterized by the presence of oncogenic ETV6 :: NTRK3 fusions, which are amenable to tropomyosin receptor kinase (TRK) inhibitor therapy. Despite its morphologic, immunophenotypic, and genetic similarities to SC of the salivary and mammary glands, diagnostic pitfalls may arise in differentiating from papillary thyroid carcinoma due to overlapping features such as papillary growth, nuclear irregularity, and variable expression of PAX8. Tumor misclassification may lead to delayed consideration of molecular testing and targeted therapy. A total of 13 cases of thyroid SC have been documented in the literature, indicating a tendency for advanced clinical presentation followed by a protracted clinical course, with most patients surviving until the end of the study period despite some experiencing recurrences. However, tumor-related mortality occurred in around 30% of cases, with the overall survival ranging from days to years, underscoring the variability in tumor behavior and the need for further research efforts. Among documented cases of thyroid SC, prognostic factors established for salivary SC have shown broad distributions, including a mitotic activity ranging from < 1 to 10 per 10 high-power fields and variable presence of necrosis, awaiting additional case experience to better elucidate their relevance in thyroid SC. We hereby present a 61-year-old female patient with widely metastatic thyroid SC treated with larotrectinib and provide an updated review of the literature on the molecular pathogenesis and clinicopathologic characteristics of this rare entity.

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Secretory Carcinoma of the Thyroid in a 49-Year-Old Man Treated with Larotrectinib: Protracted Clinical Course of Disease Despite the High-Grade Histologic Features

Clinicopathological investigation of secretory carcinoma cases including a successful treatment outcome using entrectinib for high-grade transformation: a case report

Clinicopathological characteristics and outcomes of 23 patients with secretory carcinoma of major salivary glands

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Department of Laboratory Medicine and Pathology, Division of Anatomic Pathology, Division of Laboratory Genetics and Genomics, Mayo Clinic, Rochester, MN, USA

Ying-Hsia Chu

Department of Medical Oncology, Essentia Health, Fargo, ND, USA

Bassim Kobrossy

Department of Radiation Oncology, Essentia Health Cancer Center, Fargo, ND, USA

David Schwartz

Department of Otolaryngology- Head and Neck Surgery, Essentia Health, Fargo, ND, USA

Alan D. Bruns

Department of Laboratory Medicine and Pathology, Essentia Health, Fargo, ND, USA

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YHC and JM conceptualized the case report and initiated the project (JM as the primary pathologist; YHC reviewed the pathology on a consultative basis). YHC, DS, and JM collaboratively wrote the manuscript including revisions. ADB provided clinical insights from a surgical perspective. All authors reviewed the manuscript.

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Correspondence to Ying-Hsia Chu or Julie Marsh .

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Chu, YH., Kobrossy, B., Schwartz, D. et al. Secretory Carcinoma of the Thyroid: A Case Report and Update of Literature. Head and Neck Pathol 18 , 84 (2024). https://doi.org/10.1007/s12105-024-01693-8

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Received : 21 July 2024

Accepted : 19 August 2024

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DOI : https://doi.org/10.1007/s12105-024-01693-8

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