Federal Banking Regulators Clarify and Ease Suspicious Activity Reporting Requirements

Federal banking regulators have issued frequently asked questions (“FAQs”) to clarify and ease certain requirements related to the filing of suspicious activity reports (“SARs”) by financial institutions.

On October 8, 2025, the Financial Crimes Enforcement Network (“FinCEN”), jointly with the Board of Governors of the Federal Reserve System (“Federal Reserve”), the Federal Deposit Insurance Corporation (“FDIC”), the National Credit Union Administration (“NCUA”), and the Office of the Comptroller of the Currency (“OCC”), issued the FAQs to ensure that “financial institutions are not needlessly expending resources on efforts that do not provide law enforcement and national security agencies with the critical information they need to detect, combat, and deter criminal activity.”

I. Overview

Financial institutions are required to file SARs with FinCEN when they detect certain known or suspected federal criminal violations, or pattern of criminal violations, committed or attempted against the institution or involving a transaction or transactions conducted through the institution. Generally, the amount involved has to be $5,000 or more if the institution has a substantial basis for identifying a possible suspect or group of suspects, and $25,000 or more if there is no substantial basis for identifying a possible suspect or group of suspects. If the violation involves certain insiders of the institution, a SAR has to be filed no matter what amount is involved.

The number of SARs filed by financial institutions annually has increased tremendously over the years, with a total of 4.6 million filed in 2023. The new FAQs are intended to somewhat ease the compliance burden on institutions and to make SARs more efficient in identifying and combating criminal activity.

According to Under Secretary for Terrorism and Financial Intelligence John K. Hurley, “SARs should deliver better outcomes by providing law enforcement the most useful information—not by overwhelming the system with noise. Compliance requires real resources, and that’s why prioritization is crucial.”

II. The FAQs

Question 1: SAR Filings for Potential Structuring-related Activity

Is a financial institution required to file a SAR for a transaction or a series of transactions with a value at or near the currency transaction reporting (“CTR”) threshold (i.e., over $10,000) absent information that the transaction or series of transactions is designed to evade Bank Secrecy Act (“BSA”) reporting requirements?

No. The mere presence of a transaction or series of transactions by or on behalf of the same person at or near the $10,000 CTR threshold is not information sufficient to require the filing of a SAR. Financial institutions are only required to file a SAR if the institution knows, suspects, or has reason to suspect that the transaction or series of transactions are designed to evade CTR reporting requirements. Absent this knowledge, suspicion, or reason to suspect, financial institutions are not required to file a SAR.

A financial institution is required to file a SAR for a transaction conducted or attempted by, at, or through the institution if it involves or aggregates at least $5,000 in funds or other assets and the institution knows, suspects, or has reason to suspect that, among other criteria, the transaction is designed to evade any BSA reporting requirement. This includes transactions designed to evade the requirement that a financial institution file a CTR for one or more transactions in currency by, through, or to the institution, by or on behalf of any person, and that result in either cash in or cash out totaling more than $10,000 during any one business day.

Attempting to evade CTR reporting requirements—known as structuring—may be indicative of underlying illegal activity and is unlawful under the BSA. Under FinCEN’s regulations, structuring is defined as a person, acting alone, or in conjunction with, or on behalf of, other persons, conducting or attempting to conduct one or more transactions in currency, in any amount, at one or more financial institutions, on one or more days, in any manner, for the purpose of evading CTR reporting requirements.

Question 2: Continuing Activity Reviews

Is a financial institution required to conduct a review of a customer or account following the filing of a SAR to determine whether suspicious activity has continued?

No. A financial institution is not required to conduct a separate review—manual or otherwise—of a customer or account following the filing of a SAR to determine whether suspicious activity has continued. Financial institutions instead may rely on risk-based internal policies, procedures, and controls to monitor and report suspicious activity as appropriate, provided those internal policies, procedures, and controls are reasonably designed to identify and report such activity.

Question 3: Continuing Activity Reviews – Timeline

What is the timeline for a financial institution that elects to file SARs in accordance with FinCEN’s continuing suspicious activity guidance?

For financial institutions that elect to file SARs in accordance with FinCEN’s continuing suspicious activity guidance, below is a timeline in which a financial institution files a SAR with an identified subject and determines that suspicious activity has continued:

• Day 0: detection of facts that may constitute a basis for filing a SAR
• Day 30: filing of initial SAR
• Day 120: end of 90-day period
• Day 150: filing of a SAR for continued suspicious activity

When filing a SAR for continuing activity, the date or date range of suspicious activity (Item 30 on the SAR form) should include the entire 90-day period starting on the date immediately following the filing of the initial SAR or the date following the end of the previous 90-day period.

Question 4: No SAR Documentation

Is a financial institution required to document the decision not to file a SAR?

No. There is no requirement or expectation under the BSA or its implementing regulations for a financial institution to document its decision not to file a SAR. FinCEN has previously encouraged, but not required, financial institutions to document the decision not to file a SAR.

III. Conclusion

The answers to these FAQs clarify regulatory requirements related to SARs and can assist financial institutions with their compliance obligations, while enabling institutions to focus resources on activities that produce the greatest value to law enforcement agencies and other government users of BSA reporting.  

This advisory is a general overview of the FAQs and is not intended as legal advice. If you have any questions about the FAQs or SARs in general, please feel free to contact Joseph D. Simon at (516) 357-3710 or via email at jsimon@cullenllp.com, Elizabeth A. Murphy at (516) 296-9154, or via email at emurphy@cullenllp.com, David Curatolo at (516) 357-3773 or via email at dcuratolo@cullenllp.com, or Gabriela Morales at (516) 357-3850 or via email at gmorales@cullenllp.com.