Banks filed more than 64,000 Suspicious Activity Reports referencing COVID-19 and related stimulus programs—about 71% of all coronavirus-related SAR filings, Financial Crimes Enforcement Network Director Ken Blanco said today. A majority of these SARs referenced suspected fraud against federal or state relief programs.
“The most common trend we see in COVID-19 related SARs involved fraudsters targeting multiple COVID-19 related government stimulus programs, employing money mules and cyber techniques,” Blanco said. “Stimulus programs intended to benefit both individual taxpayers and small businesses have been targeted for fraud, with multiple [ACH] payments disbursed to a single account representing the most common financial pattern reported in SARs.”
He urged banks to be as specific as possible when filing SARs related to COVID-19, noting that “vague references to ‘stimulus’ or ‘CARES Act’ or ‘benefit’ in SARs hinder our ability to get the information into the hands of the right team.” For example, if suspicious activity is related to an ACH payment from a state unemployment insurance program, banks should clearly mention “COVID-19 Unemployment Insurance Fraud” in field two of the SAR as well as the narrative, he said. “The more specific you are in your SAR narrative, the faster it will get to the right investigators.”
Blanco also discussed FinCEN’s recent advance notice of proposed rulemaking seeking public feedback on potential changes to the Bank Secrecy Act that would enhance the overall effectiveness of banks’ anti-money laundering programs. Calling the ANPR a “national conversation starter,” and urged banks to “think about the modernization of the AML regime in general and provide us with that feedback, too.”