The number of Suspicious Activity Reports (Sars) filed by banks last year seeking a defence from money laundering rocketed.
Sars seeking a defence against money laundering must be filed by a bank when they believe they might be inadvertently holding or transferring money which was obtained through crime.
In the 2015/16 year, the number of these Sars reported by banks to the National Crime Agency (NCA) increased by 44 per cent.
Examples noted by the NCA included Sars filed due to suspicious cash deposits, which uncovered a drug and human trafficking ring, and due to unusual overseas transactions which prompted an investigation into child sexual exploitation.
“Sars provide valuable information and intelligence from the private sector that would otherwise not be visible to law enforcement,” said Donald Toon, director of the NCA.
Some SARs provide immediate opportunities to stop crime and arrest offenders; others help uncover potential criminality that needs to be investigated, while others provide intelligence useful in the future.
The NCA has previously implied that institutions were being too trigger-happy with Sars reporting, inundating the NCA with reports in an attempt to cover their backs.
The agency released a report last year guiding banks on how to submit better quality reports, including being more concise and explicit regarding the reasons for suspicion. But the agency has released no new guidance this year and Aaron Stephens, head of corporate crime at law firm Berwin Leighton Paisner, said the increase in Sars may be due to banks getting better at identifying suspicious activity.
“The high number of Sars may indicate there's growing sophistication in identifying these situations, although it could be that people are becoming more conservative and are trying to cover themselves,” said Stephens. He added that a bank would always rather be safe than sorry, to avoid implicating itself in a money laundering investigation.