OCC Issues Final Rule Amending Suspicious Activity Reporting Requirements

Under Office of the Comptroller of the Currency (“OCC”) regulations, national banks and federal savings associations (“covered entities”) are required to file Suspicious Activity Reports (“SARs”) in accordance with the Code of Federal Regulations.

On March 16, 2022, the OCC issued a final rule amending SAR requirements. Under the amendment, the OCC is permitted to issue exemptions from SAR reporting requirements upon receipt of a request by a financial institution.

The OCC will consider issuance of an exemption if, after considering various potential factors, it determines that the exemption would be consistent with the purposes of the Bank Secrecy Act (“BSA”) and with safe and sound banking. According to the agency, these exemptions will enable the OCC to grant relief to covered entities that “develop innovative solutions intended to meet Bank Secrecy Act requirements more efficiently and effectively.”

Granting the OCC this authority under this final rule will harmonize the agency’s legal authority with the preexisting authority of the Financial Crimes Enforcement Network ("FinCEN") of the U.S. Department of the Treasury to grant such exemptions under FinCEN's SAR reporting requirements.

If a covered entity seeks an exemption for a reporting requirement that is only required by the OCC, then the OCC alone will be permitted to grant the exemption. However, a request for an exemption from the OCC’s and the FinCEN’s SAR regulations must be made separately to the respective agencies.

This final rule will be effective May 1, 2022. Financial institutions should review their policies and procedures for SAR reporting and implement provisions reflecting the amendment.