ARLINGTON, Va.—Almost half of the CU respondents to a new survey say their credit union has filed suspicious activity reports (SARs) "defensively.”
That key finding from NAFCU's latest Economic & CU Monitor report found that CUs are taking that step as they work to balance the “tension of examiners judging Bank Secrecy Act (BSA) programs based on the quantity of SARs filed with the need for discretion to ensure law enforcement is receiving the highest-quality information.”
“Although the Financial Crimes Enforcement Network (FinCEN) discourages defensive filings, Monitor respondents reported that examiners often stress the quantity of filings, putting credit unions in a bind,” NAFCU explained.
A quarter of respondents said that at some point their examiners indicated that the credit union had an inadequate number of SAR filings overall, and 22% said examiners have criticized decisions not to file a particular SAR.
The survey also found that a strong majority of credit unions support improved information sharing between financial institutions related to 314(b). Ninety percent of respondents said 314(b) information should be expanded to allow institutions to share information about fraud for a more unified approach to detecting and preventing illicit activity and to help mitigate growing fraud losses.
Sentiment Index Falls Slightly
Also included in the Economic & CU Monitor are the results from the June Credit Union Sentiment Index (CUSI), an index based on NAFCU member responses to eight questions on growth and earnings outlook, lending conditions and regulatory burden.
The CUSI fell slightly in June, but maintained a solid gain from the previous year. Survey participants are beginning to register loan demand with negative growth perceptions and are slightly more pessimistic in their outlook on potential changes in regulatory burden over the next year, NAFCU reported.