New US Anti Money Laundering Flags

flags obligating banks to file a SAR...

Suspicious Activities Within the Banking Industry
It is impossible for The Company to define all activity that would qualify as suspicious. The following list
represents typical suspicious activities within the banking industry:
Commercial Accounts
• One or more cash deposits a week that are structured to avoid CTR reporting. (Note: a deposit is
considered structured if it is between $8,000 and $10,000.)
• Two or more instances a week where a customer makes two or more cash deposits on the same day, and
the total of the deposits is between $5,000 and $8,000.
• One or more instances a week where a customer has made cash deposits to two or more related accounts,
and the total of the deposits is between $5,000 and $10,000.
• Cash deposits that are over $10,000, and, that are 25% greater than the customer’s second highest cash
deposit.
• Cash deposits that are over $10,000, and that are 150% of the customer’s average cash deposits (ignoring
inconsequential deposits that are below $3,000).
• Cash withdrawals of more than $5,000, unless the withdrawal is made for payroll purposes.
• Deposits of more than $3,000, made in traveler’s checks or money orders.
• Single purchase with cash of cashier’s checks, traveler’s checks, or money orders for more than $5,000.
• Purchase of a CD with cash for more than $5,000.
• Deposits of more than $5,000 in a week, made primarily from wire transfers.
• Check cashing customers, whose deposits of checks exceed by 50% the amount of cash they withdraw.
• Two or more instances a week where small bills ($1, $5, $10, $20) are exchanged for large bills ($50,
$100), in excess of $3,000.
Consumer Accounts
• Two or more deposits made during a week where the total amount of the deposits is greater than $5,000.
• Two or more deposits made during a month where the total amount of the deposits is greater than
$10,000.
• Two or more cash deposits made during a quarter where the total amount of the deposits is more than
$18,000.
• Any cash deposit between $8,000 and $10,000.
• Any cash deposit where the currency has a noticeable mildew aroma. Likewise, any cash deposit where
the currency has an aroma that could be drug-related (e.g., alcohol, cannabis, or an unidentifiable sweet
smell).
• One or more cash withdrawals during a month where the total amount is equal or above $5,000.
• Deposits equal or above $3,000 in a day, made in travelers checks or money orders.
• Purchase with cash of cashier’s checks, traveler’s checks, or money orders for $3,000 or more.
• Purchase with cash of a CD for $3,000 or more.

Customers Provide Insufficient or Suspicious Information
• A customer uses unusual or suspicious identification documents that cannot be readily verified.
• A customer provides an individual tax identification number after having previously used a
Social Security number
• A customer uses different tax identification numbers with variations of his or her name.
• A customer’s home or business telephone is disconnected.
• A customer makes frequent or large loan payments and has no record of past or present
employment experience. [This is more applicable to servicers, but the information may
appear in the credit report or on the loan application]
Customers Provide Insufficient or Suspicious Information
• A customer uses unusual or suspicious identification documents that cannot be readily verified.
• A customer provides an individual tax identification number after having previously used a
Social Security number
• A customer uses different tax identification numbers with variations of his or her name.
• A customer’s home or business telephone is disconnected.
• A customer makes frequent or large loan payments and has no record of past or present
employment experience. [This is more applicable to servicers, but the information may
appear in the credit report or on the loan application]
Customers Efforts to Avoid Reporting or Recordkeeping Requirement
• A customer tries to persuade a Company employee not to file required reports or maintain
required records.
• A customer is reluctant to provide information needed to complete a loan application or to
have the report filed, or to proceed with a transaction after being informed that the report
must be filed.
• A customer asks to be exempted from reporting or recordkeeping requirements.
Red Flags (continued)
Lending Activity
• Loans secured by pledged assets held by third parties unrelated to the borrower.
• Loans are made for or are paid on behalf of, a third party with no reasonable explanation.
• Large cash down payments with no reasonable explanation or explainable source of funds.
Employees [These would be red flags to look for regarding the Company’s employees]
• An employee exhibits a lavish lifestyle that cannot be supported by his or her salary.
• Employees fail to conform to recognized policies, procedures and processes.
Items from Other Sources
• Borrower makes timely payments and seeks to make their transactions as unremarkable as
possible in order to integrate his illicit funds [More applicable to servicers]
• Using nominees or "straw buyers" to secure numerous mortgages on various residential properties,
thereby creating a means for the conversion of illicit cash into real property–projecting
an appearance of many unrelated mortgages paid on a regular or expedited basis.
• Fraudulent documentation at the initiation of the loan, including among other things, false
statements, omissions straw buyers, false appraisals, identity theft.
• Invest the proceeds of illegal activity, including real estate, through the direct purchase or in
paying down loans shortly after they have been obtained.
• Quit-claim deeds in the chain of title
• Use of Powers of Attorney
• Frequent ownership changes in a short period of time (possible flipping)
• Sales between family members and business partners
• Employer is a large company but W-2 and 1099 are not computer generated