On 15th September, the UK Financial Intelligence Unit (UKFIU) introduced new plans to quicken the turnaround for any Suspicious Activity Reports (SARs). The main aim is to reduce major delays which are impacting all areas of the SARs Regime.
Money Laundering Reporting Officers (MLROs) are required to submit reports to the National Crime Agency (NCA) if they, or another member of the firm suspects financial fraud activity. Such issues include money laundering, mortgage fraud or terrorist financing.
Until consent is received, the firm submitting the report is then forbidden to undertake any prohibited transactions, such as accepting money into a client’s account or conveyancing services. This puts added pressure on firms, particularly when urgent transactions are involved, and often hinders the relationship with clients.
The new process set out by the NCA will reject any consents that fail to provide sufficient reasons for suspicion or a statement regarding criminal property.
There has been a recent increase in the average turnaround time for all SARs requests, which the NCA says reflects the volume and complexity of requests and a decline in overall quality of submissions.
Delays in the process are forcing the NCA to undertake further investigation with individual reporters to establish if there are genuine concerns. Consequently, the intended 7 day turnaround timescale currently in place is often requiring extension.
The new system is scheduled to come into force on 1st October 2014.
To support professionals in the industry, the Law Society have issued revised SAR reporting guidelines to help MLROs improve the quality of the reports they submit.