ACAMS Suspicious Activity Investigation 2

Question 1

What are the key components of a well-documented SAR investigation file?

Accepted Answer

Documentation of the alert trigger, research conducted (internal and external), timeline of suspicious activity, analysis of the activity, the filing decision rationale, and records of any law enforcement communications

Answer

Only the transaction data that triggered the alert and the SAR filing date

Answer

Only the SAR filing confirmation number and the compliance officer's signature

Answer

Customer identity documents only, with a brief notation that suspicious activity occurred

Question 2

What is the 'no tipping off' rule and how does it affect account management decisions after a SAR is filed?

Accepted Answer

Financial institutions cannot notify a customer that a SAR has been filed or is being considered about them, which means account closure decisions and customer communications must be managed carefully to avoid revealing SAR-related concerns

Answer

The rule prevents compliance staff from telling front-line employees about customer risk ratings

Answer

The rule prevents law enforcement from notifying suspects that they are under investigation

Answer

Financial institutions must immediately close accounts for which a SAR has been filed

Question 3

What is the difference between a 'voluntary SAR' and a 'mandatory SAR'?

Accepted Answer

All SAR filings by covered financial institutions are mandatory when the filing threshold is met; 'voluntary' SARs refer to filings below the mandatory threshold or by non-covered entities filing on a discretionary basis

Answer

Voluntary SARs are filed at the institution's discretion for any suspicious activity; mandatory SARs are required only for transactions over $10,000

Answer

Voluntary SARs are filed with FinCEN; mandatory SARs are filed with the relevant bank regulator

Answer

Mandatory SARs require law enforcement approval; voluntary SARs can be filed without review

Question 4

What are 'transaction monitoring scenarios' (rules) and how are they developed?

Accepted Answer

Algorithmic rules or analytical models within a transaction monitoring system designed to detect specific suspicious activity patterns; developed based on regulatory guidance, known ML typologies, the institution's risk profile, and historical SAR data

Answer

Fixed regulatory requirements mandating specific detection thresholds for all financial institutions

Answer

Manual review procedures for investigating customer complaints about transaction errors

Answer

Automated systems that automatically file SARs without human review based on transaction amounts

Question 5

How should an institution handle a FinCEN 314(a) inquiry for a customer who has a current SAR investigation open?

Accepted Answer

Respond to the 314(a) inquiry as required (confirm or deny the match), continue the internal investigation, and ensure confidentiality is maintained for both the SAR and the 314(a) response

Answer

Immediately close the customer's account to avoid liability

Answer

Notify the customer that they have been identified in a law enforcement inquiry

Answer

Halt the internal SAR investigation and wait for law enforcement to contact the institution directly

Question 6

What is 'alert disposition' in a transaction monitoring system and what documentation is required?

Accepted Answer

The process of reviewing transaction monitoring alerts and documenting the outcome — either closing the alert with documented rationale or escalating to a full investigation — required to demonstrate the appropriateness of AML decisions to regulators

Answer

The technical process of routing alerts to the correct compliance analyst

Answer

An automated system that closes alerts without human review if no prior SAR history exists

Answer

The process of adjusting alert thresholds based on false positive rates