Financial Crisis News Center

Guidance on TARP-Related SAR Filings Issued

This story appeared in Bank Digest.

The Financial Crimes Enforcement Network has published guidance intended to assist financial institutions in filing Suspicious Activity Reports on activities related to the Troubled Asset Relief Program. According to the agency, suspicious activities could include conflicts of interest, collusion, insider trading, advance fee schemes and money laundering. The advisory also gives information on how to complete a SAR.

FIN-2009-A006 at http://www.fincen.gov/statutes_regs/guidance/html/fin-2009-a006.html

Federal, State Officials Discuss Housing Anti-Fraud Efforts

This story appeared in Bank Digest.

Treasury Secretary Timothy Geithner, Attorney General Eric Holder, Housing and Urban Development Secretary Shaun Donovan, Federal Trade Commission Chairman Jon Leibowitz, Financial Crimes Enforcement Network Director Jim Freis and attorneys general from 12 states met on Sept. 17, 2009, to discuss emerging trends and proactive strategies to combat fraud against consumers in the housing markets as well as best practices to bolster coordination across state and federal agencies. The federal agencies have committed to coordinating information and resources across agencies to maximize targeting and efficiency in fraud investigations. This includes alerting financial institutions to emerging schemes, stepping up enforcement actions and educating consumers to help those in financial trouble avoid becoming the victims of a loan modification or foreclosure rescue scam.

FinCEN Outlines Step to Combat Loan Modification Fraud

This story appeared in Bank Digest.

Financial Crimes Enforcement Network (FinCEN) Director James H. Freis Jr. outlined steps that FinCEN is taking to combat persons attempting to defraud American homeowners through purported “mortgage modification” and “foreclosure relief” companies. “These predatory scams rob Americans of their savings and potentially their homes,” Freis stated in an address before the Cambridge International Symposium on Economic Crime. Freis noted that “it is important for law enforcement to be proactive in their investigative efforts, and it is just as critical that we think creatively to close loopholes on the regulatory side.” He stated that, “FinCEN will work to close loopholes that allow criminals to prey on innocent consumers. With those in the financial community, we will work to ensure they remain vigilant and share information so that industry can continue providing law enforcement with the lead information they need to aggressively root out fraud while promoting legitimate economic activity and growth. And we will also continue to challenge ourselves and our law enforcement partners to think creatively to identify new threats.”

Guidance Provided on Filing SARs Regarding Loan Modification/Foreclosure Rescue Scams

This story appeared in Bank Digest.

The Financial Crimes Enforcement Network has issued an advisory highlighting loan modification/foreclosure rescue scams so that financial institutions may better assist law enforcement when filing Suspicious Activity Reports (SARs). The advisory notes that the activities of financial institutions may intersect with loan modification/foreclosure rescue scams in two ways. First, persons or entities perpetrating the scams may seek the services of financial institutions for the purpose of receiving, depositing or moving funds relating to the scams. Second, financial institutions may become aware of such scams through their interactions with customers who have become victims. FinCEN is requesting that, if financial institutions become aware of this type of activity, they include the term "foreclosure rescue scam" in the narrative portions of all relevant SARs filed. It also requests that the Suspect/Subject Information Section of the Suspicious Activity Report include all information available for each party suspected of engaging in this fraudulent activity, including information such as individual or company name, address, phone number and any other identifying information.

FinCEN Announces Release of Manual to Aid Examiners of Money Services Businesses

FinCEN has released a manual to provide guidance to officials examining money services businesses for compliance with the requirements of the Bank Secrecy Act. (WSB No. 3966)