Suspicious Transaction Report (STR)
A Suspicious Transaction Report (STR) is a document that financial institutions must file with their Financial Intelligence Unit (FIU) whenever there is a suspected case of money laundering or fraud. These reports are tools to help monitor any activity within finance-related industries that is deemed out of the ordinary, a precursor of illegal activity, or might threaten public safety.
The criteria for providing a STR differs from country to country and even from institution to institution, depending on the nature of the suspicious activity and the particulars of the bank or fund. In the United States, FinCEN requires a suspicious activity report in several instances. First, if financial institutions believe an employee engaged in insider activity, they must file a report. However, this is not limited only to employees. Financial institutions monitor customer transactions, too. If potential money laundering or violations of the BSA are detected, a report is required. Computer hacking and customers operating an unlicensed money servicesGeneral services, including non-profits, forums and news sit... More business also trigger an action. Once potential criminalA Criminal is an individual or group who has been convicted ... More activity is detected, the STR must be filed within 30 days. If more evidence is needed – such as identifying a subject involved – an extension not to exceed 60 days is available. Finally, STR filings must be kept for five years from the date of the filing. Failure to comply with any of these regulations can result in civil and criminal penalties, including substantial fines, regulatory restrictions, loss of banking charter, and even imprisonment.
Note: suspicious transaction reports are also known as Suspicious Activity Reports (SARs)