Q: If there are multiple negative news alerts based on the same event, is a financial institution expected to independently investigate each of those alerts?
A: No. In circumstances where there are multiple negative news alerts (as identified through monitoring for unusual or suspicious activity) based on the same underlying events, a financial institution does not need to independently investigate each alert, but rather may consider whether the alert contains new or different information that warrants further investigation or whether the negative news otherwise assists or informs the evaluation of the activity at issue. Many financial institutions maintain a process for managing a high volume of alerts generated by news. This type of process will allow the financial institution to identify and evaluate new information and assess whether to update customer information and risk profile, investigate transactions which may result in the filing of a SAR, or escalate or terminate a customer relationship, as appropriate consistent with its policies, procedures, and processes. Financial institutions have flexibility in developing risk-based procedures and monitoring processes for the purpose of complying with customer due diligence requirements and, where appropriate, consideration of negative news.
This Q&A was contained in the Interagency “Answers to Frequently Asked Questions Regarding Suspicious Activity Reporting and Other Anti-Money Laundering Considerations” dated January 19, 2021. This issuance may be found here: