Suspicious Activity Reports (SAR): What You Need to Know
As RPA systems started to be commonly used in finance and banking activities, compliance with some rules imposed by governments on financial institutions has begun. One of these rules is SAR reports. So, what are SAR reports? How are they prepared?
What is Suspicious Activity Report?
Suspect Activity Reports (SAR) are tools that alert law enforcement bodies when there is a suspected case of money laundering or fraud. These reports help finance businesses to monitor any activity that might indicate unusual, illegal activity, or that could threaten public safety. Information provided through SAR reports can lead to the launch of new investigations, improve ongoing operations, and enable rapid arrest of criminals. SARs provide intelligence to the United Kingdom on criminal methods. It contributes to the United Kingdom in solving crimes and provides strategic information to reduce the impact of crime.
Who Prepares SAR Reports?
Individuals working in the regulated-sector can prepare SAR reports for activities they know or suspect about a person in accordance with Chapter 7 of the 2002 Proceeds of Crime Act (POCA). However, non-regulated-sector employees can also prepare an SAR report when they know or suspect a situation. Employees who do not report known or suspected situations will have committed a legal crime and are punished according to the severity of the crime.
When are SAR Reports Prepared?
The criteria for preparing a SAR report differ from country to country and from institution to institution, depending on the nature of the suspicious activity and the characteristics of the bank or fund. In the UK, these reports are prepared when suspicious activities specified in the Proceeds of Crime Act 2002 are encountered. In the event of known or suspected crimes such as money laundering and financing of terrorism, these reports are prepared and sent to the UK Financial Intelligence Unit (UKFIU).
How are SAR Reports Prepared?
SAR reports can be prepared online. This process is completely free and can be used 24/7. It eliminates the need for file-based reporting and expedites the process. Once the report is complete, the system provides an instant confirmation and reference number. Online reports are processed faster especially if a defense against money laundering is requested.
How are SAR Reports Used?
SAR reports are analyzed by the UKFIU. After these analyzes, the process is initiated by themselves or by law enforcement agencies, depending on the status of the report. The UKFIU or law enforcement agencies do not routinely provide updates on the SAR reports they send. However, if law enforcers request more information from them, they can get information about the presence of operational activities.