Does a bank have to document a decision not to file a SAR?

No, a bank is not required to document a decision not to file a SAR, and the BSA does not expect it either. The same is true for the other financial institutions covered by the SAR FAQs, including MSBs and broker-dealers (FinCEN SAR FAQs, Oct. 9, 2025, Question 4).

What the guidance says:

• There is no requirement or expectation under the BSA or its implementing regulations to document a decision not to file a SAR (FinCEN SAR FAQs, Oct. 9, 2025, Question 4). The FAQs are a joint issuance of FinCEN, the Federal Reserve, the FDIC, the NCUA and the OCC.
• FinCEN has previously encouraged, but not required, institutions to document that decision.
• If an institution does document, the appropriate level can vary with the specifics of the activity reviewed, and it need not exceed what the institution's internal policies, procedures, and controls need. Those controls should be risk-based and reasonably designed to identify and report suspicious activity.
• In most cases, a short, concise statement of the SAR decision will likely suffice.

What we would look at:

• Your own written procedures. Documenting no-SAR decisions is a choice an institution may make under its own risk-based procedures, not a BSA mandate. If your procedures call for a note, the requirement comes from your own policy, so check what they say and apply them consistently.
• The complexity of the case. For most reviews, keep a short note of the decision. For a more complex investigation, consider more documentation explaining the factors you weighed in reaching your SAR filing determination.

If you do decide to file, a separate question arises about how long SARs and supporting documentation must be kept. Check that separately, as it is not covered here.

Sources

1. FinCEN SAR FAQs (Oct. 9, 2025), Question 4: https://www.fincen.gov/system/files/2025-10/SAR-FAQs-October-2025.pdf

This answer is general information, not legal advice. Forteris is not a law firm.