Lost or Missing Securities Reporting Requirements for Banks: ABA Exam CRCM Q&A

The Timeframe for Reporting Lost or Missing Securities: CRCM Exam Question Answered

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Question

How long after discovery does a bank have to report any lost or missing securities when criminal activity is suspected?

Answers

Explanations

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A. B. C. D.

B

The CRCM acronym stands for "Certified Regulatory Compliance Manager," which is a professional designation for individuals who work in the field of regulatory compliance in the financial services industry.

Regarding the question you posed, it relates to the reporting requirements of a bank when it suspects criminal activity involving lost or missing securities. The reporting requirement arises under the Bank Secrecy Act (BSA), which is a federal law that requires financial institutions to assist government agencies in preventing and detecting money laundering and other financial crimes.

Under the BSA, when a bank discovers that securities are lost or missing and it suspects criminal activity, it must file a suspicious activity report (SAR) with the Financial Crimes Enforcement Network (FinCEN) within 30 calendar days of the discovery. The SAR must contain all relevant information about the suspicious activity, including the nature and extent of the suspected criminal activity, the identity of the person(s) involved, and any other information that may be helpful in investigating the matter.

Therefore, among the answer choices provided, the correct option would be A) 90 calendar days. This is because 90 calendar days is not the timeframe required by law for a bank to report any lost or missing securities. Rather, the correct timeframe is 30 calendar days under the Bank Secrecy Act. The other options provided are also incorrect:

  • Option B) 1 business day is too short, and banks are allowed up to 30 calendar days to investigate and prepare the SAR.
  • Option C) Never. Law enforcement must report is incorrect because financial institutions, not law enforcement, are responsible for filing SARs under the BSA.
  • Option D) 10 business days is also incorrect since the timeframe is 30 calendar days, not 10 business days.