October 20, 2017
The Royal United Services Institute(“RUSI”) for Defence and Security Studies — a U.K. think tank – has released a study: The Role of Financial Information-Sharing Partnerships in the Disruption of Crime (the “Study”). The Study focuses on international efforts — including efforts by the United States — regarding the reporting of suspicious transactions, money laundering, and terrorist financing. The Study is a critique of current approaches to AML reporting.
In this first blog post on the Study, we will describe some of the criticisms set forth by the Study regarding the general effectiveness of suspicious activity reporting. The New Paradigm has argued that the regime for filing SARs is outdated, that “the combined data set [from filed SARs] has massive amounts of noise and little information of use to law enforcement,” and that “the SAR database includes no feedback loop [and] . . . . there is no mechanism for law enforcement to provide feedback on whether a given SAR produced a lead or was never utilized.”