Is designed, whether through structuring or other means, to evade the requirements of the Bank Secrecy Act.Involves funds derived from illegal activity or is intended or conducted to hide or disguise funds or assets derived from illegal activity.The final rule requires mutual funds to report to FinCEN any transaction conducted or attempted by, at, or through a mutual fund that, alone or in the aggregate, involves at least $5,000 in funds or other assets, if the mutual fund knows, suspects, or has reason to suspect that the transaction: What are the specific requirements for filing Suspicious Activity Reports? § 103.15(a)(2) – Reports by mutual funds of suspicious transactionsġ. Suspicious Activity Reports must be filed on a specific form called SAR-SF (FinCEN Form 101). The requirement to file Suspicious Activity Reports, which FinCEN believes are highly useful in preventing money laundering and an important component of the anti-money laundering regime for all covered financial institutions, applies to transactions occurring after October 31, 2006. On May 4, 2006, FinCEN published in the Federal Register its final rule requiring mutual funds to file reports that identify and describe transactions that raise suspicions of illegal activity. What is the suspicious activity reporting requirement? § 103.15(a)(1) – Reports by mutual funds of suspicious transactionsġ. ![]() Moreover, these frequently asked questions are designed solely to help mutual funds comply with their suspicious activity reporting requirements, and they do not address the applicability of any other Federal or state laws.ģ1 C.F.R. We note that the suspicious activity reporting requirement, while important, is only one part of a mutual fund’s Bank Secrecy Act compliance program and adequate observation of this requirement, standing alone, will not be sufficient to meet a mutual fund’s other obligations under the Bank Secrecy Act. Mutual funds are expected to implement their suspicious activity reporting program in accordance with the nature of their business. Mutual funds are encouraged to use the basic principles set forth in the rule, as articulated in these frequently asked questions, to address variations on these questions that may arise. ![]() While the purpose of this document is to provide interpretive guidance with respect to the suspicious activity reporting requirements applicable to mutual funds, we recognize that it does not answer every question that may arise in connection with the applicable regulation. ![]() For purposes of this regulation, these investment companies are referred to as “mutual funds.” These frequently asked questions are being issued following consultation with the staff of the SEC. ![]() Securities and Exchange Commission (SEC). 1 This regulation is applicable to investment companies (as defined in section 3 of the Investment Company Act of 1940 (the “1940 Act”)) that are open-end investment companies (as defined in section 5 of the 1940 Act) and that are registered, or required to register, with the U.S. § 103.15 (“Reports by mutual funds of suspicious transactions”). The Financial Crimes Enforcement Network is issuing these frequently asked questions to clarify the suspicious activity reporting obligations of investment companies pursuant to the applicable Bank Secrecy Act regulation located at 31 C.F.R.
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