FinCen Releases Annual Review of SAR’s Data

FinCEN has issued the second edition of SAR Stats, FinCEN’s annual review of aggregated Suspicious Activity Report (SAR) filing activity and announced the introduction of Interactive SAR Stats.  FinCEN developed Interactive SAR Stats to address the large number of requests for more current aggregated SAR data than an annual publication could provide.  Interactive SAR Stats enables users to search BSA data for aggregated counts of defined suspicious activities, sector by sector, or in combination, as they choose, and the data is updated monthly so users can access the most up to date information as quickly as possible.  FinCEN has noted that with the advent of Interactive SAR Stats, FinCEN will no longer be publishing quarterly updates, but will continue to publish the annual summary in SAR Stats each year.

FinCEN also noted in its SAR Stats release that in 2014, BSA data – particularly SARs – continued to play an integral role in law enforcement investigations and financial regulatory compliance at both the federal and state levels.  In 2014 alone, over 380 unique agencies representing a broad cross section of federal, state, and local law enforcement, regulators, self-regulated organizations, and state attorney offices operating nationwide accessed Bank Secrecy Act (BSA) data via FinCEN’s portal. Thousands of agents, analysts, and investigative personnel from each of these entities have conducted in excess of 2.3 million queries against the database during that period. Last year 195 users were assigned to 94 Suspicious Activity Report (SAR) review teams across the country. In 2014 these users conducted approximately 38,000 searches that resulted in over 205,000 SARs being reviewed.

With that said, for the financial industry, the Securities/Futures/Options category reflected that Penny Stocks were overwhelmingly identified as the basis of suspicious activity.  References to this activity/product soared from approximately 1,800 references within 2012-2013 data to almost 4,400 in 2014.

Interestingly, the number of reported Unauthorized Wire Transfer(s), as submitted by Securities & Futures firms for 2014 within the category of Fraud, numbered 175. There were only 10 references to the same within 2012-2013 data. This is interesting in that, as compared to the other reporting industries, Unauthorized Wire Transfer(s) represents one of a few instances where an emerging trend is more prevalent than any other previously reported trending theme of suspicious activity for the same category.  Cybersecurity in the financial industry continues to become more critical as the hackers increase their skills.

Beyond that, recurring fraud activities involving New Account(s) and E-Mail(s) more than doubled in 2014 from those reported in last year’s edition of SAR Stats and the theme of layering followed as both an emerging and defined prevalent trend within the Securities & Futures – reported category of Money Laundering.  It was also note that layering saw substantial growth in 2014, rising over 800% from previously submitted 2012-2013 data.

Ultimately, anti-money laundering issues continue to be a concern, and firms should be mindful of their obligations related to being on the front line of the battle against money laundering.

For more information related to the SAR Stats for 2014, click here.