Suspicious Activity Report UK: When and How Firms Escalate
In brief: A suspicious activity report is used to alert the UK Financial Intelligence Unit where knowledge, suspicion, or belief about money laundering or terrorist financing arises.
Key points
- Staff normally report concerns internally first through the firm's AML route.
- The MLRO or nominated officer decides whether an external SAR is needed.
- The firm should record facts, analysis, decision, and follow-up without tipping off the client.
What is a Suspicious Activity Report?
A Suspicious Activity Report, or SAR, alerts law enforcement to possible money laundering or terrorist financing. The National Crime Agency says SARs are made by financial institutions and other professionals, including solicitors and accountants, and are a vital source of intelligence.
For a regulated firm, the practical issue is not just "submit or do not submit". It is how staff recognise concerns, how they escalate internally, how the MLRO decides, and how the firm keeps records without tipping off the client.
When should staff report internally?
Staff should report internally when they know, suspect, believe, or have grounds to suspect that money laundering or terrorist financing may be involved. They do not need to prove the offence.
Examples include:
- Source-of-funds evidence does not match the client's explanation.
- The client avoids identity, ownership, or CDD checks.
- Funds move through unrelated third parties without a credible reason.
- A client asks the firm to hide information or rush work before checks.
- Documents appear altered, false, or inconsistent.
What should an internal SAR include?
| Section | What to include |
|---|---|
| Who | Client, beneficial owners, connected parties, and matter owner. |
| What | The behaviour, transaction, documents, or explanation that caused concern. |
| When | Key dates, deadlines, payments, and review points. |
| Evidence | Documents reviewed and gaps found. |
| Risk | Why the facts may indicate money laundering or terrorist financing. |
What happens next?
The MLRO reviews the internal report, may ask for more information, and decides whether an external SAR should be submitted to the UKFIU through the SAR Portal. The NCA's SAR contact guidance refers to reporting where knowledge, suspicion, or belief relates to money laundering or terrorist financing.
What to record
Keep the internal report, supporting facts, MLRO analysis, external reporting decision, DAML considerations where relevant, dates, and follow-up actions.
This guide is general information and is not legal advice.