Suspicious Transaction Report (STR)

🔹 Definition

A Suspicious Transaction Report (STR) is a formal notification submitted by a reporting entity to the relevant Financial Intelligence Unit (FIU) when it suspects that a transaction may be linked to criminal conduct, such as money laundering, terrorist financing, tax evasion, fraud, or the proceeds of serious crimes. STRs are a legal obligation under anti-money laundering and countering the financing of terrorism (AML/CFT) laws.

In Singapore, STRs must be submitted to the Suspicious Transaction Reporting Office (STRO) under the Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of Benefits) Act and the Terrorism (Suppression of Financing) Act.

🔹 Frequently Asked Questions (FAQs)

Q1: Who is required to file an STR?

• Financial institutions (e.g., banks, insurance companies, payment platforms)
• Corporate service providers (CSPs) and Registered Filing Agents (RFAs)
• Real estate agents, lawyers, accountants, casinos, and crypto exchanges (VASPs)
  These entities are known as Reporting Entities or DNFBPs (Designated Non-Financial Businesses and Professions)

Q2: When must an STR be filed?

• When a transaction is unusual, inconsistent, or raises reasonable grounds for suspicion
• Even if the transaction has not been completed, but is attempted or proposed
• When a client provides forged, inconsistent, or incomplete documentation
• If a transaction involves sanctioned countries, PEPs, or high-risk jurisdictions

Q3: What information is included in an STR?

• Details of the customer and any third parties involved
• Nature and amount of the transaction
• Reason for suspicion, with supporting facts or analysis
• Date, time, and method of the transaction
• Actions taken (e.g., transaction blocked, account frozen)

Q4: Is the reporting party protected under the law?
Yes:

• The identity of the person or institution filing the STR is kept confidential
• The filer is granted legal immunity as long as the report was made in good faith
• It is an offence to tip off the customer that an STR has been filed
• Failure to file an STR when there are reasonable grounds can result in fines or imprisonment

Q5: What’s the difference between an STR and a SAR?

• Both serve a similar purpose and are often used interchangeably
• “STR” is commonly used in Singapore, the EU, and FATF guidance
• “SAR” (Suspicious Activity Report) is the term typically used in the United States
• Functionally, both require reporting of suspicious behavior linked to financial crime

Q6: What happens after an STR is submitted?

• The STRO reviews and analyzes the report
• It may be shared with law enforcement agencies for investigation
• The FIU may combine it with other intelligence to detect larger criminal networks or typologies
• STRs are also used in country-level risk assessments and FATF mutual evaluations