October's interagency Suspiscious Activity Report (SAR) guidance — jointly issued by FinCEN, the Federal Reserve, the Federal Deposit Insurance Corporation (FDIC), the National Credit Union Administration (NCUA), and the Office of the Comptroller of the Currency (OCC) — may represent a meaningful shift in the Bank Secrecy Act (BSA) / Anti-Money Laundering (AML) compliance practices.
Key Clarifications from the Oct. 9 FAQs
- No SAR Documentation Required: Financial institutions are not required to document decisions not to file SARs. While this had become a de facto expectation over time, FinCEN now explicitly confirms there is no regulatory requirement.
- Continuing Activity Reviews: Separate post-SAR reviews to monitor ongoing suspicious activity are not mandated. What began as a suggestion in 2000 had evolved into an examiner expectation, but the guidance clarifies that such reviews are not required.
- 90-Day Continuing SARs: Filing SARs every 90 days is not compulsory. Institutions may file based on risk and applicable timelines.
- Structuring SARs: Transactions near the $10,000 threshold do not automatically trigger SARs, unless there is a suspicion of evasion of Currency Transaction Report (CTR) requirements.
Regulatory Interpretation and Examiner Application
Although the guidance states it "does not alter existing BSA legal or regulatory requirements," its practical impact will depend on how examiners across agencies interpret and apply it. While all relevant regulators endorsed the guidance, questions remain about whether field examiners will embrace risk-based approaches without prescriptive documentation.
Industry Perspectives
- Davis Polk notes that the net effect of the guidance will depend on examiner application and anticipates further developments.
- Morrison Foerster recommends reviewing SAR and AML / Combating the Financing of Terrorism (CFT) policies in light of the clarifications and monitoring regulatory updates.
- K&L Gates advises that documenting no-SAR decisions remains a prudent practice despite the clarified guidance.
Implications for Financial Institutions
The guidance has the potential to be transformative, allowing institutions to reallocate resources toward more impactful financial intelligence efforts. However, caution is warranted. Institutions may benefit from observing how updates to the Federal Financial Institutions Examination Council (FFIEC) BSA/AML manual unfold, how industry best practices evolve, and how examiners respond in upcoming cycles.
A measured approach is advisable — scaling back where justified, but maintaining certain practices until there is clear evidence of a shift in examination culture. For example, if a transaction monitoring system already flags ongoing suspicious activity, a separate 90-day manual review may be unnecessary. Still, demonstrating that controls are reasonably designed to identify and report such activity may require more effort than maintaining a review calendar.
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© Copyright 2025. The views expressed herein are those of the author(s) and not necessarily the views of Ankura Consulting Group, LLC., its management, its subsidiaries, its affiliates, or its other professionals. Ankura is not a law firm and cannot provide legal advice.
