Make holiday fraud prevention a priority

Holiday fraud prevention isn't just about protecting accounts; it’s about preserving trust. By sharing practical and timely information, financial institutions can help consumers make informed decisions while demonstrating that their well-being is a top priority.

This season, proactive education and strong internal controls can help reduce fraud-related losses and reinforce your institution’s role as a trusted advisor and partner.

Improving SAR quality

FinCEN has consistently emphasized that the SAR narrative is the most critical part of a SAR, encouraging institutions to present facts in a clear, chronological, and objective manner. Narratives that are too vague, overly technical, or speculative can impede law enforcement's ability to act effectively.

Institutions should ensure that their SAR drafting process includes peer review, standardized templates, and clear documentation of the facts that support the basis for suspicion. Narrative training and periodic quality control reviews can also raise the overall standard, helping to ensure that SARs tell the whole story and withstand examiner scrutiny.

Enhancing employee training

Frontline staff and internal stakeholders play a crucial role in identifying and escalating suspicious activity, serving as the foundation of an effective AML/CFT program.

Regular training should go beyond compliance checklists to include scenario-based learning that reinforces what constitutes suspicious behavior, how to escalate concerns appropriately, and what documentation is required. Training should also clarify the distinction between activities that warrant a SAR and those that require internal documentation or enhanced due diligence.

AML/CFT Officers should also consider conducting targeted refresher training for staff in high-risk departments, such as those involved in wire transfers, new account openings, or customer service.

Evaluating technology

Effective suspicious activity monitoring depends not only on human judgment but also on the quality of the tools supporting compliance teams. Financial institutions should ask whether their current systems support accurate risk detection, clear case documentation, and flexible reporting. Systems should enable investigators to attach supporting evidence, track disposition decisions, and generate audit-ready documentation.

Questions to assess your institution's readiness

As your team adapts to the new SAR FAQs, these questions can help identify whether your SAR processes are aligned with FinCEN's clarified expectations, and where adjustments may be needed:

Are we filing SARs where no true suspicion exists?

• Over-filing can be a red flag to regulators and a drain on resources. Institutions should reassess whether their current policies encourage the filing of defensive SARs, rather than relying on a documented, reasonable basis for suspicion. Reviewing recent filings for trends in non-critical SARs can help recalibrate internal thresholds and staff judgment.

Are our narratives consistent, factual, and examiner-ready?

• A SAR may meet the technical filing requirement but fall short in its usefulness if the narrative is unclear, disorganized, or overly speculative. Ask whether your team has a standard narrative format and whether SARs are consistently reviewed for accuracy, grammar, and logical flow before submission.

Are we clear on the difference between due diligence and suspicious activity?

• FinCEN's FAQs emphasize that not all investigations result in a SAR. A clear internal distinction between routine enhanced due diligence and activity that truly crosses the suspicion threshold can prevent unnecessary filings while still documenting institutional oversight.

Are we using compliance resources wisely?

• False positives create alert fatigue and limit your team's ability to focus on higher-risk cases. Consider whether your current rules and thresholds are aligned with your institution's risk appetite, and whether automation or advisory support could help sharpen your focus.

Modernizing AML programs

With staffing resources stretched thin, many institutions are exploring how automation and intelligent alerts can improve SAR program performance. Tools like Abrigo Fraud Detection and BAM+ are designed to reduce false positives and provide better visibility into transaction behavior, enabling institutions to focus on higher-risk activity.

These solutions utilize behavior-based modeling, cross-channel analysis, and configurable thresholds to identify suspicious trends with greater precision. Built-in case management tools support detailed, audit-friendly SAR documentation, while flexible workflows empower investigators to confidently escalate or close alerts.

Reset your SAR program

FinCEN's new SAR FAQs aren't just technical clarifications; they are an opportunity to reset your institution's approach to SAR reporting. By aligning your internal policies, training, and systems with this updated guidance, your institution can reduce regulatory risk, preserve valuable staff time, and ensure that SAR filings deliver the intelligence they're meant to.

Key challenges for credit unions—and how to overcome them

Fraud continues to grow in complexity, and smaller institutions face unique challenges in combating it:

• Lean staffing makes 24/7 fraud monitoring difficult
• Vendor dependency can slow compliance efforts
• Limited budgets may restrict access to real-time analytics

Fraud risks affect community financial institutions regardless of ACH volume. Even modest transaction flows can hide sophisticated schemes, making customer education, risk scenario mapping, and technology investment essential.

How the right software supports Nacha compliance

Automation tools offer financial institutions a path to compliance without overburdening staff. A technology partner that delivers risk-based ACH monitoring, integrated case management, and scenario customization can help make lean AML/CFT teams more efficient. Banks and credit unions may also consider fraud detection software that provides real-time alerts, behavioral analytics, and mule account identification. Most importantly, technology partner systems should support annual reviews and examiner-ready reporting capabilities to help institutions confidently protect customers while demonstrating a commitment to fraud mitigation.

The 2026 Nacha operating rules and guidelines represent a pivotal shift for CFIs, but also a clear roadmap to smarter fraud prevention. By preparing now—adopting risk-based policies, configuring intelligent monitoring, and partnering with the right technology provider—institutions can reduce fraud risk and maintain compliance with confidence.