![]() What constitutes supporting documentation is determined by the facts and circumstances of each filing. For example, a financial institution’s procedures may require that all supporting documentation for a specific SAR be kept in a single file folder or scanned and saved in a data file. The manner in which a financial institution keeps supporting documentation may differ from one institution to the next, but each institution should specify its own method in its anti-money laundering program written procedures. When filing a SAR, a financial institution must identify supporting documentation, and this documentation must be kept on file by the institution. The term “ supporting documentation” refers to all documents or records that assisted a financial institution in determining that a particular activity required a SAR filing. What Constitutes Supporting Documentation When the disclosure of supporting documentation necessitates the use of legal process.What is meant by “supporting documentation” in SAR regulations.The Bank Secrecy Act (BSA) requirement that financial institutions provide supporting documentation for Suspicious Activity Reports (SAR) in response to requests from FinCEN and appropriate law enforcement or supervisory agencies.This guidance is being issued by the Financial Crimes Enforcement Network (FinCEN)1 to clarify: ![]() The Money Laundering Reporting Officer, or MLRO, should be independent of the business. Sometimes, you may feel pressure from the institution’s business side not to lose an important client, which is a short-sighted approach with serious consequences. ![]() A backlog or staffing issue is never an acceptable reason not to file an SAR promptly. Wilful blindness is the “deliberate avoidance of the knowledge of facts” or “purposeful indifference.”Īnother reason is backlogging, which prevents institutions from filing SARs promptly. Wilful blindness is a legal principle used in some jurisdictions in money laundering and other cases. But there are also wrong reasons not to file an SAR, which should be avoided. If an action or transaction that seemed to be unusual has a reasonable explanation, it is right not to file an SAR. The information should be easily available for investigators or financial crime officers on a need-to-know base to assist law enforcement if they have follow-up questions. Ensure that a qualified third party like auditors or regulators can follow the rationale and background of a case. The documentation should be self-explanatory, which means that a colleague should be able to review and understand the case in a short period if law enforcement comes back with questions. ![]() Record keeping applies for the cases where you filed an Suspicious Activity Report, or SAR, and for any case opened, closed, and not reported. Which documentation requirements should be kept? Keep all documents with evidence of the background, the purpose of the transactions, the trigger, the investigation carried out, and all findings and conclusions. ![]() Documentation requirements for any business process are vital in maintaining transparency, ensuring compliance with regulations, and serving as proof of transactions, which can be instrumental in mitigating fraud risks and resolving disputes if they arise. ![]()
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