Suspicious Transaction Reporting, STR/CTR Processes and Financial Intelligence
Domain 7 covers STR/CTR processes and financial intelligence. The exam tests the suspicion standard, timing, confidentiality, and what the FMU does with a report.
Core rules
- An STR is required when there is suspicion, not proof; the reporter does not have to establish the predicate offence.
- Reports should be prompt and within the prescribed deadline; attempted transactions and aborted onboarding can be reportable.
- Tipping off is prohibited: do not tell the customer, and keep the STR confidential.
- A CTR is threshold-based cash reporting; it does not replace an STR and does not by itself make a customer suspicious.
- The FMU analyses reports and may disseminate to law enforcement; quality narratives with who, what, when, where and why matter.
Worked example
A customer receives 20 inward transfers of PKR 95,000 from unrelated senders, then withdraws cash in round amounts. The pattern is below the CTR threshold per transfer, but the aggregation, rapid pass-through and mismatch with the customer's profile create suspicion. The bank should file an STR with a clear narrative, continue risk-based monitoring, and avoid alerting the customer. It should not wait for a single transfer to cross the threshold.
Traps
- Waiting for proof before filing; suspicion is enough.
- Filing only completed transactions and ignoring attempts.
- Treating a CTR as a substitute for an STR.
- Telling the customer or a third party about the report.