AML 4 MSB 11. SAR 2

Last week, I introduced Suspicious Activity Reports.

In the perfect world, a member of staff will smell a rat, gather as much as information as possible from the customer, refuse the business and immediately submit a detailed report to your nominated officer. They will submit a SAR to the NCA and a few days later, law enforcement will sweep down on the bad guy and arrest him.

Refusing business, or delaying the completion of business is anathema to most businesses. It’s hard. It can be tempting to shrug your shoulders and whisper to the customer “It’s compliance, you know.”

We need to be careful here.

Enter “Tipping Off”.

From the guidance:

6.27 It is a criminal offence for anyone to say or do anything that may prejudice an investigation or “tip off” another person that a suspicion has been raised, a SAR has been submitted or that a money laundering or terrorist financing investigation may be carried out. It is also an offence to falsify, conceal or destroy documents relevant to investigations.

6.28 Nobody should tell or inform the person involved in the transaction or anyone else that:

  • the transaction is being or was delayed because a suspicion has been raised
  • details of a transaction have or will be reported to the NCA
  • law enforcement agencies are investigating the customer

6.29 Such an offence carries a penalty of up to 5 years imprisonment and/or a fine.

Yikes.

Tipping off understandably alarms frontline staff. If you’re not careful, you end up with a team terrified to talk to customers. Create sensible guidance for them.

“If a customer asks ….. then you should respond ……”

Keep it straightforward. There is nothing wrong with saying that the system randomly selects a certain amount of transactions for escalation as a policy.

As a general rule -

Money Service Businesses are viewed as high risk.

Money Service Businesses do not do enough SAR.

When in doubt - report.

If you need help in strengthening your policies and procedures or a staff training course, get in touch.