Under Federal law, it is illegal for either the bank filing a a SAR or the government to reveal the existence of the SAR to anyone.
The government may reveal the existence of a SAR ‘in performance of their official duties’ - which for the OIG (and SEC, FinCEN, et al) would mean disclosure during an investigation.
The OIG wouldn’t even have to reveal the content of the report. If a report had been filed by one or more banks, the name of the filing bank wouldn’t necessarily have to be revealed.
The OIG would have said merely stated in their report that SAR’s were filed as part of their post-mortem on how Madoff evaded SEC investigation, because a SAR being filed would have been a big red flag that should not have been ignored by the OCC, FBI or Federal Reserve. The OIG revealed plenty of other confidential information in their report, in semi-redacted manner for the public report, laying out the breadth and scope of the information that the government had on Madoff and yet chose to ignore.
Remember, we’re talking of billions of dollars here.
That the OIG report is silent on the issue means to me that the bankers went along with this scam - and why wouldn’t they? Their bread was being buttered with the very best butter.
FWIW, JPM filed a SAR to the British authorities just before Madoff’s scheme blew up.
http://abcnews.go.com/Blotter/page?id=12297036
As the Madoff Trustee’s filing on 2/4/2011 indicates, there were automated systems flagging Madoff’s transactions... yet JPM was not filing reports.
http://www.madofftrustee.com/CourtFilings-Download.aspx?Docket=805
(you have to suffer through a lot of “redacteds” in this filing... - but start reading around p. 60...)
For those who don’t want to wade through the complaint, here’s the one nugget therein:
“222. JPMC also faced regular account activity that would have been suspicious regardless of the type of business JPMC thought Madoff was running. The 2000 OCC BSA/AML Handbook identified numerous “red flags” that financial institutions needed to consider as part of their transaction monitoring procedures. These red flags included: (a) unexplained repetitive or unusual patterns of activity; (b) frequent large dollar transactions without corresponding explanations as to how those funds would be utilized; (c) spikes in customer activity with little or no explanation; and (d) wire activity with offshore banking centers or financial secrecy havens. The 703 Account exhibited all of these types of transactions, and exhibited them repeatedly.”
JPM had him dead to rights. The filing to the UK office makes it clear that other parts of JPM viewed Madoff’s activity as suspicious, especially as massive fund outflows were being seen.