BSA/AML Student Exercises Dec. 2022

authorities by having procedures in place to detect and report such suspicious activities. Should any of these types of money laundering activities be suspected; the account is to be periodically monitored as part of the Bank's investigation. The BSA Officer is responsible for reviewing any such activity and determining whether a Suspicious Activity Report (SAR) should be filed. Procedures for Complying with Anti-Money Laundering The Bank maintains a comprehensive system of detecting and deterring such transactions that is commensurate with the Bank's risk for money laundering and terrorist financing. The Bank's Anti Money Laundering Program assists the BSA Department and Senior Management in the analysis of cash, wire, loan, monetary instrument transactions and customer profiles and identifies high risk accounts. Proper procedures have been implemented to comply with Anti-Money Laundering rules. The following reports and procedures are part of our Anti-Money Laundering Program:  Detecting Suspicious Activity — "Red Flags"  Customer Due Diligence and Enhanced Customer Due Diligence Policy and Procedures  Politically Exposed Persons (PEP)  High Risk Customers Listing  Suspicious Activity Report Policy and Procedures  Customer Identification Policy and Procedures (CIP)  Bank's Fraud Detection Report or system  BSA Department daily procedures  Name of Banks system Reports utilized to monitor account activity. The following reports may assist management, officers and staff in detecting and monitoring unusual or suspicious activity:  Suspect kite report — This report identifies excessive activity in accounts and should be reviewed for cash activity. The account profile of an account used for money laundering can be similar to that of an account used for check kiting: high volume of activity, matching deposits and withdrawals, and low average balances in relation to activity.  Overdraft report — This report can be used to assist management or account officers to detect when a "good" customer, either individual or commercial, is suddenly having financial problems.  Delinquent loan reports — Although these reports generally get special attention, management or account officers are directed to pay close attention when delinquent loans are suddenly brought up current with no reasonable explanation in the file. Loan officers must be able to explain a sudden pay-off of seriously delinquent accounts and refer the account to the BSA officer.  Demand deposit activity reports — These reports cover all customer and employee accounts, they show daily balances and accumulate deposits and withdrawals over a 30-days period. Management may establish a threshold for certain types of accounts and review only the exceptions.  Large transaction reports — These reports will be set at an amount lower than $10,000 to identify customers who might be structuring transactions to avoid CTR reporting or who have unusual activity in their account. Ensure that transaction amounts are consistent with the type of business or occupation of the customer. These reports will also serve to monitor "exempt persons" accounts for unusual or suspicious activity.  Incoming and Outgoing wire transfer report — This report identifies transfers of funds out of the country or to remote banks, transfers funded by cashier's checks or money orders in amounts under the CTR filing threshold and other suspicious activity of accountholders.

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