VIDEO: Filing Name in a Suspicious Activity Report
In this Compliance Clip, Adam discusses what FinCEN recommends for using as a title for the “filing name” of a Suspicious Activity Report. While most financial institutions probably figured this out over a decade ago, it’s important to make sure you are still following this guidance in your institution.
Video Transcript
The following is a transcript of this video.
This Compliance Clip is going to talk about the filing name in a Suspicious Activity Report. This is a BSA topic. The question we can look at is this, the question says, “What do I enter for the “Filing Name” in a Suspicious Activity Report, otherwise known as a SAR?” A SAR is a Suspicious Activity Report that must be filed by financial institutions, and one of the fields in there is the filing name. That's basically the name of the file, the way you name it so that it can be identified later. This name actually pulls through on all your communication with FinCEN. The answer to this question is going to come from FinCEN SAR Frequently Asked Question # 5.
FinCEN has a set of frequently asked questions related to Suspicious Activity Reports, and we can take a look at Frequently Asked Question # 5. Specifically, the frequently asked question says this. It says, “The filing name could be any name the financial institution chooses to use to identify the specific filing. For example, it could be Bank SAR 4-4-2013.” This frequently asked question came out around 2012, 2013, that's why they used that date. So, of course, you'd probably want to use a date. I’ve seen a lot of financial institutions do that, where they do maybe 0001-whatever the year is or something like that.
The frequently asked question goes on and says, “The process for assigning filing names is for the financial institution to decide and can assist a financial institution in tracking its BSA filings.” FinCEN goes on here to say that they recommend using a naming convention that will be easy to understand and track for record keeping and audit examination purposes. The reason they say that is when they come to you with a SAR, because FinCEN and examiners can all view SARs before you do, if an examiner comes to you with a SAR and says “Hey, I want to see this,” they're going to give you the reference of the filing name. And that filing name, you need to be able to use to pull up your files and be able to reference your internal documents related to that. In essence, it's a numbering system. What you have to do is figure out what numbering system you're going to use so when the examiner comes to you with a filing name, you can identify that in your organization and come up with your work papers, any background, anything additional that goes along with that SAR. That's what FinCEN is recommending.
That said, FinCEN strongly recommends that the FinCEN SAR file names should not include the name of a subject that is in the SAR as that may lead to an inappropriate disclosure of the SAR, which is prohibited by law and regulation and could have some potential consequences. Back in the old days, before this guidance came out, a lot of financial institutions would name their Suspicious Activity Reports the name of the customer. So Witmer 001 or Witmer 1, or just Witmer if it's a smaller financial institution that doesn't have too many SAR filings. That was an easy way to identify who the SAR was related to. However, the problem with that is that filing name gets sent in email communications from FinCEN, it gets listed in a number of places, and if you have the last name of the person, you could actually accidentally disclose the name of the subject and that would be a problem. So you can't list a SAR filing John Doe No. 1, that would be a problem. What you need to do is come up with some sort of numbering system that does not include the name of the customer.
Hopefully your financial institution has not been including the name of the customer in your SAR filings for at least a decade or so, since this frequently asked question came out. But sometimes what we see is when guidance is old, sometimes we forget why the guidance was there and we revert to our old ways inadvertently, and that becomes a problem. So make sure your financial institution is not including the names of subjects in your SAR filing name, otherwise you could have an inappropriate disclosure of your SAR, which could be a problem in exams and be a violation of law.
That's it for this Compliance Clip. I hope it was beneficial to you.