When James Freis took over as director of the Treasury Department's Financial Crimes Enforcement Network (FinCEN) in March, he inherited a paperwork problem: a flood of suspicious activity reports (SARs) and currency transaction reports (CTRs).
Despite efforts by his predecessors to make the reports--required of banks and other depository institutions under the anti-money-laundering (AML) and counterterrorism requirements of the 1970 Bank Secrecy Act (BSA) and expanded to the brokerage and asset management communities by the USA Patriot Act--available electronically on the BSA Direct platform, which has since been abandoned, law enforcement agencies must sift through the filings manually. And "defensive" filings, where firms attempt to minimize their exposure to enforcement actions by submitting SARs for transactions that do not necessarily fit the criteria of being suspicious, have proliferated.
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