Martha Whitmire, the BSA Compliance Officer for First National Bank, is responsible for monitoring the bank's daily currency activity and wire transfers, for compliance with information retention and reporting requirements. Ms. Whitmire notices during her review on March 10 that, during the previous two weeks, a transaction occurred on the same account several times during the week. The activity appeared at one branch office as cash deposits in dollar amounts under the reporting thresholds. Ms. Whitmire discusses this activity with the branch manager and determines that this same deposit activity occurred several times during the previous six weeks. She then conducts a more extensive examination of the account's activity for several months and discovers that cash deposits were made at one branch office and purchases of bank cashiers checks were made by withdrawals from the same account at a different branch office. All withdrawals and purchases of cashier's checks were for the identical amount as the cash deposits. Which statement best describes Ms. Whitmire's responsibility?
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A. B. C. D.D
In this scenario, Martha Whitmire is the BSA Compliance Officer for First National Bank and her responsibilities include monitoring the bank's daily currency activity and wire transfers for compliance with information retention and reporting requirements. During her review on March 10, she notices that the same account had cash deposits made several times during the previous two weeks at one branch office in amounts under the reporting thresholds.
Ms. Whitmire discusses this activity with the branch manager and determines that this same deposit activity occurred several times during the previous six weeks. She then conducts a more extensive examination of the account's activity for several months and discovers that cash deposits were made at one branch office and purchases of bank cashier's checks were made by withdrawals from the same account at a different branch office. All withdrawals and purchases of cashier's checks were for the identical amount as the cash deposits.
Based on this information, Ms. Whitmire has identified potential structuring activity, where the customer may be attempting to avoid triggering currency transaction report (CTR) requirements by keeping cash deposits below the reporting threshold. Additionally, the identical amounts of cash deposits and withdrawals for cashier's checks suggest that the customer may be using the bank to facilitate suspicious activity, such as money laundering or terrorist financing.
Therefore, the best course of action for Ms. Whitmire would be to report the account activity as suspicious account activity and recommend that a Suspicious Activity Report (SAR) be filed. A SAR is a document used by financial institutions to report suspicious transactions or activity to the Financial Crimes Enforcement Network (FinCEN) of the US Treasury Department. The SAR is used to alert law enforcement of potentially illegal activity and to assist in the prevention, detection, and prosecution of financial crimes.
Option A, to complete a CTR for each of the cash activities at the branch office, may not be sufficient in this case, as it does not address the potential structuring activity and the use of the bank to facilitate suspicious activity.
Option B, to make no report of the activities because the transactions were not discovered until after the 15-day reporting deadline, is not a valid option as the reporting deadline should not prevent the filing of a SAR when suspicious activity has been identified.
Option C, to report the account activity to senior management for further review, may be appropriate as part of the internal control and escalation process, but it does not address the requirement to file a SAR when suspicious activity has been identified.