TopMortgage Compliance Update (1)

November 5, 2012  


FinCEN: SAR Narrative, PowerPoint, and Mortgage Loan Fraud

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On September 18, 2012 FinCEN held an Informational Webinar regarding the new FinCEN Suspicious Activity Report (SAR).

The corresponding, full PowerPoint presentation of the recorded version of this Webinar is available HERE.

For those interested in actually viewing the Webinar, HERE is the link to the FinCEN webpage.

Recently, FinCEN issued two important reports (available in our Library):
  • SAR Activity Review - Trends, Tips & Issues (Issue 22)
  • Mortgage Loan Fraud Update - Suspicious Activity Report Filings in 2nd Quarter 2012 
The first report offers significant insight and guidance in monitoring suspicious activity, and the second report provides important insights regarding SAR filings related to mortgage loan fraud.

For years we have worked with our bank clients on auditing their SAR filings and AML compliance, and I can vouch for the practical advantages of reading these on-going FinCEN reports to enhance your risk management responsibilities.

Jonathan Foxx
President & Managing Director
Lenders Compliance Group

SAR Narrative: "5 W's and the How" 
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In the recent SAR Activity Review, sections are provided that outline the basic aspects toward filing a SAR. In particular, the section  on writing an effective SAR Narrative is important to consider.

FinCEN rightly states that the narrative "is a critical part of the SAR because it is where the filer can summarize and provide a more  detailed description of the activity being reported." For that reason, it is essential that the narrative be clear, complete and thorough.

This section of the FinCEN report offers the "5 W's" that I have written about extensively as a way to develop the SAR narrative.

(See, for instance, my magazine article, Anti-Money Laundering Program - Preparation is Protection, August 2012.)

Our clients have learned how to use this narrative method.

The FinCEN report does not mention the "How" narrative that I have advocated - and which I will discuss below.

In my view, the Anti-Money Laundering Program should have an appendix devoted exclusively to the SAR Narrative procedures, especially outlining the "5 W's and the How" method of writing it.

The narrative must be clear, complete and thorough and the method I advocate is an effective means toward accomplishing these  goals.

FinCEN's outline is rather brief, so I will provide a much more extensive set of action steps for you to follow.

The article contains the "5 W's" method provided by FinCEN, after which I will add some remarks about narrating the "How".

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SAR Activity Review -
Trends, Tips & Issues
(Issue 22)

Mortgage Loan Fraud Update -
Suspicious Activity Report Filings
in 2nd Quarter 2012

FinCEN Suspicious Activity Report
and Filing Instructions
PowerPoint Presentation

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This communication is sent to our valued clients and colleagues, who regularly receive our Mortgage Compliance Updates, Compliance Alerts, Commentaries, and related publications.

These publications are free to subscribers. Information contained herein is not intended to be and is not a source of legal advice.

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