When does the time period for filing a SAR start?

The correct answer is that the time period for filing a Suspicious Activity Report (SAR) starts when the institution has reason to suspect suspicious activity. This determination is crucial because the Bank Secrecy Act (BSA) mandates that financial institutions must report any known or suspected violations of law, or suspicious activities that may indicate money laundering or fraud.

When a financial institution becomes aware of suspicious circumstances—whether through transaction patterns, customer behavior, or other indicators—that triggers the obligation to assess the situation further and, if appropriate, file a SAR. The law requires that this report be filed within a specific timeframe—typically within 30 days of the detection of the suspicious activity—but the important point is that the obligation to act officially begins at the moment of suspicion, not at arbitrary intervals such as the end of the month or upon request by a customer.

This understanding is essential for compliance to ensure that institutions meet their regulatory responsibilities promptly and effectively, helping to safeguard the financial system against illicit activities.