ABA Urges FinCEN to Refine SAR Burden Calculation Methodology

While the Financial Crimes Enforcement Network’s effort to calculate and evaluate the burden of filing Suspicious Activity Reports is a good first step, FinCEN needs to do more to fully grasp the costs and benefits of SAR filing, the American Bankers Association said in a comment letter today.

“FinCEN’s assessment identifies significant costs and burdens, but it omits key components and miscalculates others,” ABA said. “As a result, the revised SAR burden is imprecise; actual costs are greater than those FinCEN has identified; and more work is needed to accurately identify SAR burden. ABA stands ready to work with FinCEN to help with that analysis.” For example, ABA said, FinCEN overstates the role of automation in SAR filing. “Evidence from the banking sector verifies that the process is still significantly manual and that should be reflected in the burden assessment.”

In an informal ABA member survey, bankers said that FinCEN’s estimates of time for SAR processing were inadequate and that labor costs were understated. They also said FinCEN did not factor in key regulatory and operational costs, as well as quality controls. However, ABA “commend[ed]FinCEN for taking steps to better quantify the burdens associated with the SAR filing process.” FinCEN is also in the process of recalculating the burden of Currency Transaction Report filing.