What is a Suspicious Activity Report (SAR)?
In this article, you’ll gain a clear understanding of what SARs are, how and when they should be filed, and why they matter for your organisation.
In this article, you’ll gain a clear understanding of what SARs are, how and when they should be filed, and why they matter for your organisation.
A Suspicious Activity Report (SAR) is a report used to flag suspicious activities within the financial system. It helps authorities detect and prevent financial crimes such as money laundering, terrorist financing, and fraud. By reporting suspicious transactions, businesses contribute to a safer and more transparent financial ecosystem.
In this article, you’ll gain a clear understanding of what SARs are, how and when they should be filed, and why they matter for your organisation. It’s a practical guide for anyone working with compliance, finance, or risk management.
The requirement for SAR reporting emerged in the 1970s alongside growing efforts to combat money laundering. In the United States, the Bank Secrecy Act (BSA) of 1970 became one of the first laws mandating the reporting of suspicious activities.
Since then, many countries have developed similar frameworks, often based on recommendations from international organisations like the Financial Action Task Force (FATF).
In the EU, SAR reporting is a key part of the Anti-Money Laundering Directives (AMLD), which member states are required to implement through national legislation.
Here are three common examples of activities that may trigger a SAR:
Suspicious activities often follow certain recurring patterns:
Recognising these patterns is critical to detecting and preventing financial crime early. Read more about key alert triggers that can be implemented to strengthen your AML programme.
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A SAR should be filed as soon as a business reasonably suspects that a transaction or customer activity may be linked to illegal operations, even without full proof. It’s about reasonable suspicion, not evidence of a crime.
For a SAR to be complete, it should include:
Any employee handling customer relationships or transactions can and should report suspicious activity, especially in sectors subject to AML regulations, such as:
While any staff member can identify suspicious activities, compliance officers typically compile and submit the SARs.
Yes, SARs are confidential. The identity of the reporting individual is protected by law in most countries to encourage reporting and safeguard whistleblowers. SAR information is accessible only to authorised authorities and investigators.
SARs are typically submitted to national Financial Intelligence Units (FIUs). Examples include:
These agencies analyse the information and may initiate further investigations or collaborate with other authorities.
SARs play a critical role in identifying and stopping financial crime before it escalates. By submitting SARs, businesses and institutions help to:
Every SAR contributes a crucial piece to the larger fight against crime.
Want to learn more about how Trapets can support your organisation in detecting and reporting suspicious activity?
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