PRACTICAL SOLUTIONS
When to make the call
to law enforcement
K
nowing when to file a Currency
Transaction Report (CTR) or what
documentation is required to open
a new account is clearly defined by regulation or company policy. Deciding when to
file a Suspicious Activity Report (SAR) is less
clear and depends on an AML/CTF professional’s knowledge and personal experience
to determine when something is not right.
But when it comes to going beyond filing a
SAR to contacting law enforcement directly,
it can be a tough call.
As a compliance officer, you may have struggled with the question of when to reach out
to law enforcement and which agency you
should call. The following law enforcement
experts offer some guidelines to use when
faced with these questions.
If you feel the situation threatens irreparable damage, make the call, according to
Rick Adams, a retired Special Agent with
the IRS Criminal Division. “Call law enforcement if you feel there is going to be harm to
the bank; harm to a depositor, for example
accountholders wiring money to Nigeria or
Canada because they have fallen victim to
a lottery scam; or harm to another person,
like elder abuse,” Adams said. “If you think
the situation may cause harm to society,
like potential terrorist activity, it should be
reported immediately.”
Before making the call, take time to assess
the risk, Adams advises. If a transaction
is just suspicious, like an unusual deposit
pattern from one of your known customers,
you should report it on a SAR, but not necessarily call law enforcement
38
Before making the
call, take time to
assess the risk
“For example, if one of your customers
has a video rental company and has had no
suspicious activity for two years but now
has a huge influx of cash, that’s suspicious,”
Adams said. “But just because it might be
unusual and suspicious, the activity isn’t
over the top.”
There are times though when unusual activities can become a pattern of ongoing and
escalating suspicious transactions. When
that happens, it’s time to reach out to law
enforcement, according to Al Gillum, CAMS,
president of Advanced Compliance Technologies, LLC, and a retired postal inspector.
“Watch the SARs you are filing (on a person
or company),” Gillum said. “If you start
seeing a pattern over two or three weeks
that the dollar values are significant and
the activity is an ongoing process, it’s time
to reach out to law enforcement. A rule of
thumb I use is to call at the point the activity
is reaching $50,000.”
ACAMS TODAY | MARCH–MAY 2011 | ACAMS.ORG
Jerry Loke, a retired IRS Agent and current
member of the Philadelphia Organized
Crime and Drug Enforcement Task Force
(OCDETF), adds a word of caution. For
institutions that don’t have contacts within
the law enforcement community or for
a compliance officer who isn’t sure if an
activity warrants a call to law enforcement,
contacting the local SAR review team might
be a better option.
“In extreme situations, like those discussed
above, law enforcement needs to be notified,
but you do need to put some parameters in
place,” Loke said. “Otherwise the calls could
be overwhelming. Many of the U.S. Attorneys’ Offices have district SAR review teams
in place. They review SARs weekly and meet
once a month to bring SARs before the crossfunctional law enforcement team. In situations where you do not have a relationship
with a SAR team, it may be best to communicate with the U.S. Attorney’s Office directly.”
Who should you call?
Once you decide to contact law enforcement,
the next question is who to call. If you have
law enforcement contacts, use them. If you
don’t have contacts, notify the appropriate
agency based on the type of crime.
“Determine which agency to call,” Adams
said. “If it is a terrorist activity, call the FBI.
If it involves narcotics call the IRS or the
DEA. If you suspect elder abuse, call local
law enforcement.”
If you don’t have law enforcement contacts
now, develop them. Every compliance office
should have multiple law enforcement
contacts, according to Gillum. Build rela-