Suspicious Activity Reports

Niall Hearty of Rahman Ravelli considers the NCA’s recently-released statistics on the use of SARs.

Almost a million suspicious activity reports (SARs) were made in 12 months, according to the National Crime Agency (NCA).

The UK’s Financial Intelligence Unit (FIU) received a record total of 901,255 SARs between April 2021 and March 2022. The FIU’s statistics, contained in the NCA’s 2022 Suspicious Activity Report (SARs) Annual Report, show that banks filed 637,776 of the SARs over the period.

The FIU, which is based in the NCA’s National Economic Crime Centre (NECC), said the figure is a 21% increase on the previous 12-month period. The NCA said that an increase in the number of businesses in the fintech and cryptocurrency businesses sectors that had started filing reports was a factor in the increased number of SARs. 

The NCA stated that it had prevented suspected criminals receiving more than £300 million in payments – more than double the value of payments blocked the previous year – using the defence against money laundering (DAML) mechanism. Financial institutions in the UK can file a DAML if they suspect that completing a specific transaction will involve them in a money laundering offence. It gives the NCA the opportunity to approve or reject transfers.

The rise in denied payments occurred even though the NCA received 21% fewer DAMLs in the 12 months covered by the report. The Agency attributes this to financial institutions making fewer unnecessary requests. It used civil powers, including account freezing and forfeiture orders, to freeze or seize £114 million of the transactions it denied under the DAML process.

The report also says that the FIU has a dedicated team working alongside the Combatting Kleptocracy Cell, which the NCA established in 2022 to investigate sanctions evasion and high-value money laundering following Russia’s invasion of Ukraine. SARs can play a significant role in providing information that the Cell requires.

There is little doubt that SARs are at the centre of the NCA’s efforts to tackle money laundering, illicit finance and other forms of crime. The NCA clearly sees them as a useful tool in gathering intelligence to identify and prevent illegal activity.