Suspicious Activity Reports (SARs) is the name of a disclosure made to the National Crime Agency (NCA) under either Part VII of the Proceeds of Crime Act 2002 (POCA) or Part III of the Terrorism Act 2000. If your bank fails to make a Suspicious Activity Report when the law requires it to do so, then they may be committing a criminal offence. SARs have been around for 20 years now, but to most are still considered new.
The number of Suspicious Activity Reports has increased steadily. The National Crime Agency received and processed a record number of Suspicious Activity Reports (SARs) in 2017-2018, (approximately 463,938), 22,619 of which regarded money laundering and 83% of which came from banks.
So that tells you a little about a SAR, but why would the bank freeze your money? Banks use automated systems that monitor bank account usage. If you receive regular payments into your bank account (i.e. your salary, of let’s say, £2000) and then you are suddenly perhaps gifted some early inheritance to the sum of £100,000, then this would likely trigger an alert at the bank and a human would review that alert. If the £100,000 came from a relative with the same surname as you, then it is unlikely to generate a SAR. However, if the money came from one of the countries on a bank ‘watch list’, for example Nigeria, then it is extremely likely to be investigated further.
Large cash deposits made over the counter at the bank, or through the bank’s automated machines may also trigger an alert, which would require further investigation. The banks do not do this ‘out of spite’. As mentioned above they are regulated and required by law to sound the alarm if any suspicion arises. They are covering themselves by investigating unusual and inconsistent activity on your account. In some cases though, this acts to protect clients from suspicious activity and protects their deposited monies.
Before 2007 a bank had 31 days to remove the freeze on a bank account. Since the Criminal Finances Act that came into force in 2017, law enforcers can apply to the Crown Court for an extension of up to 6 months. If the Crown Court is satisfied that the investigation is ongoing, then the court is likely to grant the extension.
During the investigation it is unlikely that the bank will tell you exactly what is going on. This is because of section 333 of the Proceeds of Crime Act 2002, which creates an offence to “tip off” anybody that is being investigated. The offence of “tipping off” comes with a maximum penalty of five years imprisonment or a fine, or both.
If you would like to discuss any of the above, or you are having difficulties with your bank, then call us on 01273 726951 and ask to speak to Paul Britton. Alternativey, click the contact us section on our website.