New data from the Bank Policy Institute (BPI) indicates that the Financial Crimes Enforcement Network (FinCEN) may have underestimated the time banks require to file suspicious activity reports (SARs). According to BPI's survey, banks spend an average of 21.41 hours on each SAR, a figure that starkly contrasts with FinCEN's estimate of 1.98 hours. This discrepancy emerged in a submission to FinCEN as part of their Paperwork Reduction Act obligations.
Greg Baer, President and CEO of BPI, commented on these findings: “Today’s findings show that SAR filings require significantly more resources than government estimates. While these resources might be manageable if the filings were effective, examiners at the federal banking agencies continue to push banks to investigate irrelevant matters, diverting time and resources from more effective methods of detecting and reporting illegal activity.”
Under the Bank Secrecy Act, banks are mandated to file SARs with FinCEN. These reports are intended not as legal judgments but as informational tools for law enforcement and national security efforts. A BPI study revealed that out of over 640,000 SARs filed in 2017, only about 4% received any follow-up from law enforcement. The Anti-Money Laundering Act of 2020 aimed to improve these processes by encouraging innovation and technology adoption; however, many aspects remain unimplemented.
The survey drew data from fifteen BPI member banks with assets exceeding $100 billion each. Together, they file over 550,000 SARs annually. The reported time investment includes producing and reviewing a SAR and overseeing its filing process but excludes program development or maintenance activities.
The Bank Policy Institute is a nonpartisan organization representing leading U.S. banks. Its members include universal and regional banks along with major foreign banks operating in the country.