Now that you’ve seen what ACA Insight has to offer, don’t be without it. Subscribe now!

The weekly news source for investment management legal and compliance professionals

Current subscribers - please log in to the website in the upper right-hand corner

News December 20, 2004 Issue

No Separate SAR Needed for OFAC Blocking Report, Says Treasury

Attention dual registrants: If you file an OFAC blocking report, you no longer have to file a separate SAR for the transaction, unless thereís something aside from the fact that it was blocked that should be brought to FinCENís attention.

Thatís the upshot of recent interpretative guidance issued by the Treasury Departmentís Financial Crimes Enforcement Network (FinCEN). Previously, FinCEN took the position that when a transaction was blocked under OFAC, separate filings had to be made to both OFAC (Treasuryís Office of Foreign Assets Control) and FinCEN. However, FinCEN recognized that that resulted in financial institutions having to make duplicate filings to the same regulator (namely, the Department of Treasury).

In its recent statement, FinCEN noted that if the transaction that triggered the OFAC blocking report would have been reportable under the SAR rules even if there hadnít been an OFAC match, a SAR still would be required. And, if a firm has additional information about a transaction that is not reported on the OFAC report, a separate SAR should be filed.

Unlike broker-dealers, banks, and other types of firms that are required to file SARs ("suspicious activity reports"), SEC-registered investment advisers are not subject to any specific requirement to file SARs, although they may do so voluntarily. Like any other "U.S. person," however, all advisers are required to block accounts, payments, or transfers in which an OFAC-designated country, entity, or individual has an interest. OFAC blocking reports must be filed with 10 business days. For an overview of OFAC, see a three-page brochure OFAC designed last spring specifically for the securities industry.