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The UK to reform SAR reporting because what they have is not good enough (albeit probably one of the best in the world!!)

26/05/2022

Suspicious Activity Reports (SARs) are the foundation of the UK's response to money laundering and terrorist financing

The regime requires

  1. The regulated sector (e.g. banks, lawyers, accountants, estate agents) to submit a SAR if they know, suspect, or have reasonable grounds for knowing or suspecting money laundering or terrorist financing.
  2. In addition, where anyone, including those in the regulated sector, thinks they may be dealing with criminal or terrorist property and at risk of committing a money laundering or terrorist financing offence, they can submit a request for consent.
  3. Such requests are called,
  • DAML (Defence Against Money Laundering) SARs or
  • DATF (Defence Against Terrorist Financing) SARs.

SARs are submitted to the UK Financial Intelligence Unit (UKFIU), which disseminates them to UK law enforcement agencies and international FIUs.

  • As such, the SARs regime helps to protect the integrity of the regulated sector from exposure to criminality and provides law enforcement with critical intelligence to disrupt crime and terrorism.

However, despite the current SARs regime being one of the toughest in the world,

  • The intelligence data from SARs needs to be more effectively and efficiently reported, analysed and used,
  • So that the UK can go faster and further in identifying dirty money and increasing money laundering prosecutions and
  • Securing the reputation of the UK as a global leader in tackling economic crime.

The main problems affecting the regime are:

  1. Inconsistent levels of compliance reporting in some parts of the regulated sector resulting in inefficiencies.
  2. Insufficient human resource capacity within the UKFIU which limits their ability to analyse financial intelligence or engage with partners to improve the quality of SARs.
  3. Under-utilisation of SARs by law enforcement.
  4. Legacy IT systems which cause inefficiency and ineffectiveness throughout the regime.

https://www.gov.uk/government/publications/home-office-major-programmes-accounting-officer-assessments/accounting-officer-memorandum-suspicious-activity-reports-sars-reform-programme

UNITED KINGDOM