Magazine article American Banker

Suspicious Activity Filings at Record Pace in 1st Half

Magazine article American Banker

Suspicious Activity Filings at Record Pace in 1st Half

Article excerpt

WASHINGTON -- Banks are on a pace to file another record number of suspicious activity reports this year.

SAR filings by depository institutions, at 279,703, were up 11.3% in the first six months of 2006 compared with the same point a year earlier, according to data released by the Financial Crimes Enforcement Network on Monday.

In every month but January, SAR filings have jumped in 2006. If the trend is holding steady during the second half, banks, thrifts, and credit unions will file more than last year's record 522,655 reports.

The network's "SAR Activity Review: By the Numbers" also showed an increase in filings on check fraud, identity theft, and mortgage loan fraud.

Depository institutions filed 32,832 SARs related to potential check fraud during the first half, a 23% jump from the same point a year earlier. Filings related to possible check kiting grew by 29% during that time, to 9,919, and reports on counterfeit checks increased by 34%, to 18,611.

Filings on suspicion of identity theft continue to skyrocket. The 14,138 first-half filings related to identity theft equaled about two-thirds of the roughly 22,000 SAR filings on identity theft during all of 2005.

Reports on mortgage fraud also jumped 51%, to 17,368, from a year earlier. Fincen released a study on Nov. 3 that said automated loan processing and subprime lending are among a handful of soft spots that leave banks vulnerable to mortgage fraud. The study cited a connection between identity theft and mortgage fraud, noting that more than 2% of all mortgage fraud SARs from Jan. …

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