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Financial Services Law Insights and Observations

FinCEN Warns of Fraudulent Disaster Relief Schemes

Financial Crimes Disaster Relief FinCEN Fraud SARs

Financial Crimes

On October 31, the Financial Crimes Enforcement Network (FinCEN) issued an advisory to financial institutions to warn of the potential for fraudulent activity related to recent disaster relief efforts. The advisory cautions financial institutions to pay particularly close attention to benefits fraud, charities fraud, and cyber-related fraud. Accordingly, it lists several red flags to assist in spotting these fraudulent schemes, including, among others:

  • The cashing or depositing of multiple emergency assistance checks by the same individual;
  • The payee organization having a name similar to, but not identical to, a well-known or reputable charity; or
  • The use of money transfer services to receive donations.

The advisory also reminds financial institutions to file a Suspicious Activity Report (SAR) if there is reason to believe any fraudulent activity may be taking place.

Find more InfoBytes disaster relief coverage here.

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