SARS: Reclaiming the Purpose of Suspicious Activity Reports

Are We Reporting Suspicion – or Avoiding Blame?

Suspicious Activity Reports (SARs) are meant to be sharp tools in the fight against financial crime  – illuminating suspicious financial behaviour, triggering investigations, and helping disrupt organised networks. But today, many SARs function more like a reflex than a strategy. Institutions file them to shift risk, to meet audit requirements, or simply because it's safer to over-report than under-report.

This is not only inefficient, it can be dangerous.

When we treat SARs as regulatory shields instead of intelligence contributions, we dilute their value. We flood financial intelligence units (FIUs) with high volumes of low-quality data, making it harder to identify what truly matters.

So how did we get here? And what would it take to shift back toward impact?

Suspicion Isn’t Binary – It’s Human

What is it about a person, an encounter or a transaction that generates suspicion? There is no set check list. Suspicion is subjective, shaped by the environment, the person, the context, and the stakes.

A well-dressed customer walks into a high-street bank, calmly requests to deposit £100,000 in cash, no prior appointment, no explanation. Is that suspicious? Most financial crime professionals would say yes  – but why?

Is it the amount? The behaviour? The absence of context?

‘Having led many workshops on SARs over the years, I would estimate that on average, 80% of the room raise their hands to confirm that something is "suspicious", but when asked to justify why, they often stumble’ says James Booth, Head of Anti-Money Laundering, Counter Terrorism and Sanctions at Silent Eight. ‘Why are compliance officers intrinsically wired to be suspicious first?’ he wonders. 

In practice, suspicion is a starting point, not a conclusion. And in regulated environments where fear of regulatory backlash looms large, that starting point often becomes the entire decision-making engine.

Across the UK, US, Singapore, and other financial hubs, the laws are broadly consistent: if you ‘know or suspect’ money laundering, you must file a SAR. But the interpretation of that threshold varies wildly  – driven by training, tone from leadership, legal conservatism, and the absence of meaningful feedback.

SARs Are Intelligence Signals  – Not Legal Shields

To be clear, SARs are not accusations. They are not conclusions of guilt. They are intelligence artefacts  –  flags that point to possible illicit activity and invite deeper investigation.

Their true power lies in the system that surrounds them. One SAR might show a small pattern. But hundreds  – across banks, jurisdictions, and timelines  – can expose the financial backbone of global trafficking or corruption networks.

When used properly, SARs help:

• Connect individuals, accounts, or entities across time

• Reveal laundering typologies and criminal pathways

• Protect vulnerable people from further harm

• Drive law enforcement actions and multi-agency disruption
  
  

But when used defensively  – when filed with minimal context, limited behavioural insights, or copy-paste language – SARs add little to the bigger picture. They become more about proving compliance than about preventing crime.

Volume Is Up  – But What About Value?

Let’s look at the numbers.

In the UK alone, the Financial Intelligence Unit received 872,048 SARs between April 2023 and March 2024 – up 52% from 573,085 in 2020. The US saw over 3.8 million filings in the same period. These are massive volumes, far outpacing the resources available to analyse them.

The reason for this surge isn’t necessarily increased crime or better detection. In many institutions, it’s more about defensive filing.

A common sentiment among money laundering reporting officers is ‘We’d rather file than explain why we didn’t.’

The result? FIUs are overwhelmed. Signal drowns in noise. The best reports  – the ones that could lead to arrests, seizures, or victim identification  – are harder to find. And SAR writers, frustrated by the lack of feedback, lose motivation to generate stronger reports.

The Feedback Black Hole

One of the biggest complaints from SAR filers is that they never hear back.

They don’t know whether their SAR was read, used, connected to a broader case, or even deemed useful. Did it help identify a trafficking ring? Was it redundant? Was it high-quality?

This feedback vacuum kills learning and weakens morale. Writers begin to see SARs as black-hole submissions. Over time, narrative quality suffers. Risk is logged and life goes on.

The Financial Action Task Force (FATF) has flagged this issue repeatedly, noting that the private sector lacks sufficient insight into how reports are used. This disconnect limits the ability to improve report quality and undermines the sense of purpose behind the work.

What SARs Can Do: A Human Trafficking Lens

Despite all this, SARs can, and do, make a real-world difference.

Human trafficking investigations are a powerful example. These crimes often operate in financial shadows, with few physical indicators. But money leaves clues. SARs have helped flag:

• Repeated low-value payments inconsistent with declared employment
  
  

• Wages from multiple employers going into a single account
  
  

• Transfers to high-risk jurisdictions
  
  

• Use of vulnerable individuals’ accounts controlled by third parties
  
  

When these signals are aggregated across institutions and time, they can lead directly to victim rescues, trafficker arrests, and financial disruption.

In the US, FinCEN has credited SARs with directly aiding the dismantling of trafficking operations, especially when reports include geographic context, account linkages, and behavioural detail.

From Reputation Fear to Strategic Blindness

The over-reporting culture didn’t arise in a vacuum. High-profile failures changed the landscape.

HSBC’s $1.9 billion fine in 2012 for AML lapses in Mexico sent shockwaves through the industry. So did the Danske Bank scandal in 2017. These cases cemented a brutal lesson: compliance failures are existential threats.

The result? Institutions shifted from risk management to risk avoidance. A SAR became an insurance policy. The goal was no longer to be insightful  – it was to be unassailable.

Add public pressure, media scrutiny, and the threat of regulatory shaming, and you get the ‘Netflix Effect’: financial institutions fearing documentaries as much as enforcement action. Protecting the brand became the top priority — even if it meant flooding the system with questionable reports.

A Smarter, More Strategic Path Forward

So what can be done? 

According to James Booth, ‘the relationship between regulators and institutions must evolve from transactional compliance to shared intelligence partnership. Until this shift occurs, the true strategic potential of the SAR will remain unrealised’.

In other words, we start treating SARs as part of a strategic intelligence function, not just a legal requirement.

5 Ways to Reclaim SARs as Strategic Tools

1. Reframe SARs as Intelligence Contributions

• Shift ownership to financial crime strategy teams

• Train for quality narratives, not box-checking

• Recognise and reward reports that lead to real-world impact
  
  

2. Build Better Feedback Loops

• FIUs should share anonymised case studies and SAR outcomes

• Introduce regular quality reviews with constructive insights

• Strengthen public-private partnerships, like the UK’s JMLIT
  
  

3. Clarify and Modernise Regulation

• Regulators should provide clearer guidance on suspicion thresholds

• Reward well-documented non-reporting where appropriate

• Pilot smarter SAR models based on typology and threat indicators
  
  

4. Change Compliance Culture

• Link SAR metrics to disruption outcomes, not volume

• Use leadership messaging to reconnect staff to the mission

• Push back on over-reporting norms that create drag, not clarity
  
  

5. Put Victims at the Center

• Train with real-world case studies and impact stories

• Prioritise reports that map to high-harm crimes (e.g. trafficking, exploitation)

• Enable law enforcement to give anonymous feedback when SARs lead to disruption

From Disclosure to Disruption

At their best, SARs are some of the most powerful intelligence tools we have. They can expose the financial roots of crime, support victim recovery, and break the economic lifelines of global illicit networks.

But to unlock that potential, we have to stop treating SARs like compliance paperwork. They aren’t just a way to avoid blame  – they’re a way to make a difference.

Not every SAR will change the world. But some already have. And many more could.