Related Terms
DEFINITION
Suspicious Activity Report (SAR)
A Suspicious Activity Report (SAR) is a report that banks and other financial institutions must make when they observe suspicious activity that might be indicative of money laundering, fraud, terrorist financing, or other financial crimes. SARs are submitted to the relevant regulatory authority, such as the Financial Crimes Enforcement Network (FinCEN) in the US or the European Anti-Fraud Office (OLAF) in the EU. SARs are confidential and play a crucial role in helping authorities detect and prevent financial crime.
Synonyms
Financial crime report
Acronyms
SAR
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Synonyms
Financial crime report, unusual activity report, compliance reporting
Acronyms
SAR
Examples
A bank notices that one of their clients has recently started making large wire transfers to offshore accounts that are inconsistent with their previous transactions. The bank’s compliance team flags this activity and investigates it further. They then decide to file a Suspicious Activity Report and send it to the relevant authority. The report covers all the details of the transactions, the reason behind their suspicion, and any supporting documentation
FAQ
When is a Suspicious Activity Report (SAR) issued?
SARs are triggered by many different red flags, such as unusually large transactions, transactions that don’t align with the client’s previous financial profile, frequent transactions to high-risk countries, and so on.
Who has access to Suspicious Activity Reports once they are filed?
SARs are confidential documents and as such are only accessible to authorized regulatory and law enforcement parties, such as FinCEN and OLAF. Importantly, the person or legal entity mentioned in the SAR will not be notified.
What is the difference between a SAR and a STR?
Suspicious Activity Reports (SARs) are issued when a customer displays unusual behavior that is inconsistent with their financial profile. Said behavior can include unusual transactions, as in the example, but can include other factors as well. A Suspicious Transaction Report (STR) on the other hand only considers unusual transactions. With that being said, these two terms can overlap in meaning depending on the specific jurisdiction.
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