A large international bank has detected potentially suspicious activity in one of its customer accounts. Following an investigation, the bank has determined the activity to be typical of suspected money laundering.
To which entity should this activity be reported on a suspicious transaction report according to Financial Action Task Force?
Click on the arrows to vote for the correct answer
A. B. C. D.C
According to the Financial Action Task Force (FATF), suspicious transactions should be reported to the Financial Intelligence Unit (FIU) of the country where the bank is located. Therefore, the correct answer is option B.
FIUs are central national agencies responsible for receiving, analyzing, and disseminating financial information related to suspected money laundering, terrorist financing, or other criminal activities. FIUs act as a critical link between the financial sector and law enforcement agencies, as they receive and process suspicious transaction reports (STRs) from financial institutions and disseminate them to the appropriate authorities for investigation.
In this scenario, the large international bank has detected potentially suspicious activity in one of its customer accounts and has investigated it, determining it to be typical of suspected money laundering. Therefore, the bank is required to file a suspicious transaction report (STR) with the FIU of the country where the bank is located.
The National Security Council (option A) is not the correct entity to report suspicious transactions to, as its focus is on broader national security issues, and it is not responsible for receiving and analyzing financial information related to money laundering or terrorist financing.
Similarly, the local law enforcement agency (option C) is not the appropriate entity to report suspicious transactions to, as FIUs serve as the central point of contact for receiving and analyzing STRs, and disseminating them to the appropriate authorities.
Finally, while the federal law enforcement agency (option D) may be involved in investigating money laundering cases, the primary entity responsible for receiving and analyzing STRs is the FIU of the country where the bank is located. Therefore, option B (FIU) is the correct answer.