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Our BSA Officer sought counsel from an attorney regarding a suspicious activity report (SAR) filing. I am the CEO of the bank, and when I asked about the nature of the guidance received, the BSA Officer said they were not allowed to tell me. Assuming the SAR is not based upon an action I have taken, is this accurate? – IBA Compliance Connection

IBA Compliance Connection

Your go to source for compliance!

Our BSA Officer sought counsel from an attorney regarding a suspicious activity report (SAR) filing. I am the CEO of the bank, and when I asked about the nature of the guidance received, the BSA Officer said they were not allowed to tell me. Assuming the SAR is not based upon an action I have taken, is this accurate?

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We agree that generally SARs and related information may be shared with bank management and the bank’s board, provided that your assumption (that the SAR does not involve you) is correct.   

The Bank Secrecy Act (BSA) generally prohibits disclosures of a “SAR or any information that would reveal the existence of a SAR” to third parties, including in response to a subpoena. The BSA, however, specifically exempts “the sharing by a bank, or any director, officer, employee, or agent of the bank, of a SAR, or any information that would reveal the existence of a SAR, within the bank’s corporate organizational structure for purposes consistent with Title II of the Bank Secrecy Act as determined by regulation or in guidance.” The BSA regulations also obligate the bank’s management to promptly notify its board of directors of any SARs.

Of course, these exemptions for disclosures to bank management do not apply if the SAR involves an individual to whom disclosure is made. Disclosure is permitted only if “no person involved in any reported suspicious transaction is notified that the transaction has been reported.” But assuming that you were not involved in the transaction providing the basis for the SAR, we believe that your BSA Officer may share the SAR and the related guidance with you.

For resources related to our guidance, please see:

  • 31 CFR 1020.320(e)(1) (“No bank, and no director, officer, employee, or agent of any bank, shall disclose a SAR or any information that would reveal the existence of a SAR. . . . Provided that no person involved in any reported suspicious transaction is notified that the transaction has been reported, this paragraph (e)(1) shall not be construed as prohibiting: . . . (B) The sharing by a bank, or any director, officer, employee, or agent of the bank, of a SAR, or any information that would reveal the existence of a SAR, within the bank’s corporate organizational structure for purposes consistent with Title II of the Bank Secrecy Act as determined by regulation or in guidance.”)
  • 12 CFR 208.62(h) (“The management of a member bank shall promptly notify its board of directors, or a committee thereof, of any report filed pursuant to this section.”)