Suspicious Activity Report (SAR) Filing Threshold and Strict Confidentiality
A broker-dealer identifies a series of structured deposits and questionable transactions totaling $8,500 that have no apparent business purpose. The firm files a Suspicious Activity Report (SAR). Which rule governs the notification of the customer?
Under the Bank Secrecy Act, SAR filings (triggered by suspicious transactions of $5,000 or more within 30 calendar days) are STRICTLY CONFIDENTIAL.
Complete Analysis & Legal Rationale
Under the Bank Secrecy Act, SAR filings (triggered by suspicious transactions of $5,000 or more within 30 calendar days) are STRICTLY CONFIDENTIAL. Disclosing the existence of an SAR to the customer or anyone else is a federal crime known as 'tipping off'.
Distractor Autopsy (Why Other Options Are Traps)
FINRA exam writers design incorrect distractors using specific calculation mistakes and regulatory misconceptions. Review why each option succeeds or fails:
Strict prohibition against disclosing an SAR filing under federal law ('no tipping off').
Providing a copy of an SAR to a customer is a criminal offense.
Representatives cannot alert clients under any circumstance.
SARs never appear on customer account statements.