A customer has borrowed the cash surrender value of their life insurance policies. Which requires a further investigation and filing of the SAR/STR?
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A. B. C. D.C
Based on the information given, option B requires a further investigation and filing of a suspicious activity report (SAR) or suspicious transaction report (STR).
When a customer borrows the cash surrender value of their life insurance policies, it is generally a legitimate transaction. However, canceling the insurance contract without concern for the penalties after the money is borrowed is a suspicious activity that requires further investigation.
Canceling the policy right after borrowing the cash surrender value could indicate that the customer's intent was not to maintain the life insurance policy but to obtain the cash. This behavior is inconsistent with normal customer behavior and may be a sign of money laundering or another illegal activity.
Therefore, the financial institution should conduct further investigations into the transaction and determine whether the activity is indicative of money laundering or terrorist financing. If there are suspicions of illicit activity, the financial institution should file an SAR/STR with the appropriate authorities as per the regulatory requirements.
Options A, C, and D may also require further investigation and monitoring, but they do not necessarily indicate suspicious activity that warrants filing of an SAR/STR.
Option A (using multiple currency equivalents from different sources to pay the monthly life insurance policy premiums) could indicate structuring, which is a suspicious activity, but it does not necessarily indicate money laundering or terrorist financing.
Option C (paying the monthly life insurance policy premiums with cash) could indicate potential suspicious activity, but it is not necessarily indicative of money laundering or terrorist financing.
Option D (directing the payment of the money borrowed to an unrelated third party) could be a legitimate transaction, but it may also require further investigation if it is not consistent with the customer's profile and typical transactional behavior.