2020 Journal of Community Bank Studies

2020 COMMUNITY BANK CASE STUDY COMPETITION

6,000 to 7,200 per year. While some alerts may result in reports, the majority do not. Alerts of possible suspicious activity may also come from the bank tellers or law enforcement inquiries. The BSA staff at C&N works diligently to address the alerts as they come in by looking at users’ past transactions, locations, and values. Once management decides a SAR is to be reported, it does so in a timely and accurate matter. After filing the SAR, it is up to the bank to monitor the report in case of any further inquiries related to it. Collaboration FinCEN issued a statement in October 2018 addressing instances in which banks could enter into collaborative arrangements with other banks to reduce costs and improve efficiency. As part of its BSA compliance efforts, C&N does collaborate with other financial institutions to gain more information for its cases. Most often, it communicates with local banks but has collaborated with banks across the country when the situation deemed it necessary. On average, C&N collaborates

with other banks every two to three times a month. SARs filed by one institution can be linked to SARs filed at other institutions, which facilitates this process. Financial crimes can often span the country and involve many banks. This collaboration is crucial because it provides key information to law enforcement that helps identify links to illicit activity. Section 314(b) of the Patriot Act also helps to encourage collaboration among financial institutions. There is a process, however, that must be followed before sharing information. First, the institutions must submit a notice to FinCEN that states their intention to voluntarily share information; this is effective for one year (“31 CFR”). They must also confirm the other institution has also submitted this notice, and it is up-to-date. The final requirement limits the kind of information the banks can share. Information can only be shared to identify and report on money laundering/terrorist activities, determine whether to establish or maintain an account, or to assist the financial institution in complying with any of the information-sharing requirements (“31 CFR”). Overall, this section of the Patriot Act is effective when helping to assist banks collaborate with each other. C&N is a 314(b) registrant and has used the Patriot Act as needed. On a larger scale, C&N also has direct interactions with FinCEN and state/ federal examiners when it feels the need to seek

On average, C&N collaborates with other banks every two to three times a month.

additional guidance on BSA matters. BSA-Related Actions with Law Enforcement

C&N hopes that there will be more legislation to directly address the relationship between

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