Money Laundering, Terrorism and Financial Institutions - USA Patriot Act Monitor

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11/5/2007 FinCEN Describes Risks of Convenience Checks

FinCEN’s 12th SAR Activity Review discusses how credit card convenience checks have become popular with identity thieves. Convenience checks, also called credit card checks or courtesy checks, are often mailed to customers without any request to do so, and have been falling into the hands of criminals who use them to make purchases, obtain cash, or even pay off balances on credit card accounts. A number of convenience check typologies are described in the Review. FinCEN has often complained about over-use of “other” as a categorization of a reported activity on a SAR form, and does so here again, but the agency also notes that a number of activities are appropriately placed in the catch-all category, including:

Unregistered or unlicensed MSB.
Tax evasion.
Fictitious instruments (which could also be “suspicious documents”)
Wire transfer fraud.
ITIN/SSN fraud or misuse.
Unusual cash activity.
Bank fraud under 18 USC 1344.
Fraudulent W-2.
Phishing and/or spoofing.
Automated clearing house fraud.
Lottery/sweepstakes scams.
Narcotics trafficking.
Currency smuggling.
Employing illegal aliens.

There is no indication that any of these categories will be added to the SAR forms’ lists of activities, though the frequency of some may eventually justify revising the forms. Other insights in the 12th SAR Activity Review will be discussed in the January issue of the Monitor. Certain typologies described have also been added to the red flag checklist posted on the Civic Research Institute website..

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