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Question

Difficulty: EasyAnti-Money Laundering (AML), KYC, and Sanctions Compliance

Under FinCEN regulations and anti-money laundering (AML) compliance rules, what is the mandatory filing threshold for a broker-dealer to report a suspicious transaction by submitting a Suspicious Activity Report (SAR)?

  1. $5,000 or more in funds or other assetsAnswer
  2. B
    More than $10,000 in physical cash deposits in a single business day
  3. C
    $25,000 or more in wire transfers to foreign financial institutions
  4. D
    $100,000 or more in total account equity transfers

Answer

The mandatory threshold for a broker-dealer to file a Suspicious Activity Report (SAR) is $5,000 or more.
Under Bank Secrecy Act (BSA) rules administered by FinCEN, broker-dealers must file a Suspicious Activity Report (SAR) for any transaction that involves or aggregates at least $5,000 in funds or assets if the firm knows or suspects that the transaction involves illegal activity, violates federal securities laws, or lacks a business rationale.

Step-by-Step Solution

1
Identify the specific AML reporting requirement being tested
The question asks for the dollar threshold requiring a broker-dealer to submit a Suspicious Activity Report (SAR).
Different AML reports have distinct regulatory triggers and threshold amounts.
2
Recall the monetary threshold for filing a SAR under Bank Secrecy Act (BSA) rules for broker-dealers
Broker-dealers are required to file a SAR with FinCEN for any suspicious transaction involving $5,000 or more.
This threshold is established by federal AML regulations to capture potentially illegal activity.

Key Concept

Suspicious Activity Report (SAR) Filing Threshold
Estimated Time:45s
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Topics

Anti-Money Laundering (AML), KYC, and Sanctions Compliance