Compliance Clarified – a podcast by Thomson Reuters Regulatory Intelligence

Series 8, Episode 6: Suspicious activity reports surge; 2023 filings on pace for another record

Jun 22, 2023

Financial institutions in the US are filing a record number of suspicious activity reports (SARs), with spikes in check fraud, elder abuse, human exploitation, and benefit scams. The podcast discusses a Thomson Reuters special report on financial crime and fraud, highlighting the impact of the Anti-Money Laundering Act of 2020. It also addresses the challenges in detecting terror finance and the surge in SAR filings during the pandemic.

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Introduction

00:00 • 5min

The Importance of Information Sharing and Factors contributing to the Surge in SAR Filings

04:44 • 3min

Surge in Suspicious Activity Reports (SARs) during the Pandemic

07:36 • 6min

Increase in Check Fraud and Efforts to Combat Human Trafficking

13:53 • 5min

Challenges in Detecting Terror Finance and Reporting Suspicious Activity

18:50 • 4min

Financial institutions in the United States are filing an exceptionally high volume of suspicious activity reports (SARs), with more than 3.6 million SARs submitted in 2022, a 57% increase over pre-pandemic (2019) levels. Additionally, suspicious activity reporting is on pace to set another annual record in 2023.

A special report published recently by Thomson Reuters takes a deeper dive into the data offering valuable insight into critical areas of financial crime.

A link to the report is available here:
www.thomsonreuters.com/en-us/posts/investigation-fraud-and-risk/special-report-suspicious-activity-reports/

In this episode of Compliance Clarified, Todd Ehret, Senior Regulatory Intelligence Expert at Thomson Reuters is joined by Brett Wolf, Senior AML Correspondent for Thomson Reuters. As co-authors of the report, Todd and Brett discuss some of the high-level findings of the report and probe critical issues such as financial crime, elder fraud, human exploitation, Covid-19 pandemic-related fraud, and terror financing.

While SAR filings soared across virtually all categories of criminal activity, data shows significant spikes in check fraud, elder financial abuse, human exploitation, and government-related benefit scams. Vulnerable populations have grown in both size and susceptibility during the pandemic, especially migrants and the elderly.

Although some observers attribute the SAR filing surge to advancements in detection technology and vigorous regulatory communication, data from the Federal Bureau of Investigation (FBI) corroborates sharp, real-world increases in fraud across many categories.

The report relies on data from January 2014 through the end of the first quarter of 2023, and was obtained from the FinCEN SARs database. The data is a helpful benchmark for financial institutions' risk, compliance, and anti-fraud leaders. It can be used to contrast internal data against broader market-affecting industry peers.

The Compliance Clarified podcast series covers a wide range of topics which affect compliance officers at financial services firms and aims to help compliance professionals make sense of the often-challenging regulatory environment. It considers the big challenges of the day and offers practical ideas for emerging best practices.

Compliance Clarified is a podcast from Thomson Reuters Regulatory Intelligence.
Listen to wide-ranging, insightful discussions on all things compliance for financial services firms. We delve into the hot topics of the day, the challenges faced and offer up practical ideas for emerging good practice. We de-mystify regulation and explore the art, as well as the science, of the ever-expanding role of the compliance officer. Enforcements, digital transformation, regulatory change, governance, culture, conduct risk – anything and everything impacting the compliance function is up for discussion.