At the end of the day, what constitutes suspicious activity can sometimes be hard to determine. To help you decide when you should (and shouldn’t) file a SAR, we outline a few different example cases below.
Ultimately, any suspicious behavior should be reported. It’s often better to err on the side of caution and report behavior that may not end up being suspicious in nature.
Example of a case where a SAR must be filed
A customer has a relatively new account, which has historically only been used for domestic payments. Onboarding was completed, and no red flags were presented.
Their account receives an international transfer of $27,000.
In this instance, a SAR must be filed, as the $25,000 transaction threshold has been exceeded.
Example of a case where a SAR may or may not be filed
A customer has been a client for 5 years. They are in good standing with the financial institution and have had no suspicious activity in the past. They make relatively routine transactions that have not raised any flags.
Seemingly out of nowhere, the customer makes a handful of transactions of $4,000 each. In total, they make 5 transactions two weeks apart, amounting to $20,000.
While this could be a legitimate attempt to transfer a large amount of money (spread out over a period of time), it could also be an attempt to skirt the $5,000 threshold for automatic AML filings.
Having a transaction monitoring solution can detect this anomaly, flagging it for investigation. After investigation, an analyst may find that the transactions are not suspicious, or could still have suspicions about the legitimacy of the transfers. This could be ruled out or could be escalated, with a SAR being filed.
Example of a case where a SAR does not need to be filed
A customer has been a client for over 5 years, and is in good standing with the financial institution. They have consistent transaction activity, none of which raises red flags.
The customer is in the process of purchasing their first home, and makes a large down payment. This transaction is undoubtedly out of the norm for their account activity, but it isn’t malicious. This would likely prompt an investigation, but an investigation should determine that this is a legitimate transaction. In most cases, this would not warrant a SAR filing.
