Banks and credit unions connect fraud and AML risk signals through FRAML: defined fraud alerts and confirmed losses go to the BSA/AML team for a suspicious activity report decision, and AML findings such as money mule patterns go back to fraud operations, with a named owner, a time limit and a logged record for every hand-off.
This article covers FRAML’s scope, the signals that cross, hand-off ownership under the SAR clock, 314(b) sharing, and examiner expectations.
What FRAML Covers at Banks and Credit Unions
FRAML, a contraction of fraud and anti-money laundering, coordinates fraud prevention and BSA/AML compliance so that evidence one team gathers informs the other’s decisions. Each answers to different rules:
- BSA/AML answers to the Bank Secrecy Act and its suspicious activity reporting requirements
- Fraud risk management answers to loss accounting and the Regulation E liability limits on unauthorized electronic transfers
The two meet at the transaction, since a check fraud loss, an account takeover or a scam payment is often reportable suspicious activity too. FRAML covers alert routing, case hand-offs, SAR decisions and 314(b) sharing.
Signals That Should Cross Between Fraud and AML
Six common FRAML hand-offs and the record each one leaves:
| Signal | Sent by | What the receiving team does | Record kept |
|---|---|---|---|
| Confirmed account takeover or scam payment with funds sent out | Fraud | BSA/AML reviews sending and receiving accounts for a SAR decision | Referral with detection date, linked SAR decision |
| Deposit of a counterfeit, altered or stolen check | Fraud | BSA/AML reviews the depositing account for mule or layering activity | Fraud case ID linked to the AML case |
| Suspected elder financial exploitation reported by a branch | Branch or fraud | BSA/AML decides on a SAR; fraud limits further losses | Branch report, SAR decision, account actions |
| Money mule pattern from AML transaction monitoring | BSA/AML | Fraud checks for linked victims and holds or closes the account | Alert ID, fraud review outcome |
| 314(b) request citing suspected fraud | BSA/AML | Fraud searches for matching payees, devices and victims | 314(b) log, registration check, results |
| Account exit after SAR review | BSA/AML | Fraud adds the identifiers to new-account screening | Exit decision and identifiers only |
Alerts the fraud team clears as false positives stay in its own queue. The exit row shares identifiers only, because 31 CFR 1020.320(e) keeps a SAR, and anything that would reveal it, confidential.
Owning Each Hand-Off and the SAR Clock
Each hand-off has four steps, and each step has one owner:
- The sending team’s investigator submits the referral with the detection date and evidence.
- A named analyst in the receiving team logs receipt and opens or links a case.
- The BSA officer, or a SAR committee, makes the suspicious activity report filing decision.
- The receiving team returns the outcome to the sender, so both cases close on the same facts.
Under 31 CFR 1020.320(b)(3), a bank files a SAR no later than 30 calendar days after initial detection of facts that may support one. Where no suspect is identified, it may take another 30 days, with no more than 60 days in total.
Per the FFIEC BSA/AML Examination Manual, the clock starts once an appropriate review finds the activity suspicious, and that review should finish in a reasonable period of time.
Sharing Fraud Signals with Other Institutions Under 314(b)
Section 314(b) of the USA PATRIOT Act lets registered financial institutions share information about possible money laundering or terrorist activity under a safe harbor from liability. Under 31 CFR 1010.540, the safe harbor depends on:
- A notice to FinCEN effective for one year
- Reasonable steps to verify the other institution’s registration
- Use of the information only for listed purposes, and procedures protecting its confidentiality.
FinCEN’s Section 314(b) fact sheet of June 12, 2026 states that fraud offenses are specified unlawful activities for money laundering, so a suspicion of fraud is enough to share, in real time while the activity is occurring.
What Examiners Look for in a Connected Program
When more than one department researches unusual activity, the FFIEC BSA/AML Examination Manual says the lines of communication between them must remain open, and it uses BSA and fraud as its example.
The manual also expects a process that routes internal referrals to the right staff and a final decision maker with authority over SAR filings, and it points examiners at that decision process over individual SAR decisions.
The interagency SAR FAQs of October 9, 2025 add that the BSA carries no requirement to document a decision not to file; a short, concise statement documenting a SAR decision will likely suffice.
FinCEN’s AML/CFT Priorities, first issued June 30, 2021, list fraud and describe it as believed to generate the largest share of illicit proceeds in the United States. Filing data shows the same overlap: a Forvis Mazars analysis of FinCEN statistics found check fraud accounted for 7.46% of 2025 SAR filings by banks, savings associations and credit unions.
A FinCEN proposed rule published April 10, 2026, issued alongside OCC, FDIC and NCUA proposals, would require AML/CFT risk assessments to incorporate those priorities. The Federal Reserve published a parallel proposal on July 9, 2026, and as of October 2026 none of the proposals were final.
Frequently Asked Questions
What’s the Difference Between AML and Fraud?
Fraud takes money from a victim through deception or unauthorized access; money laundering moves and disguises the proceeds of crime, fraud included. Fraud teams work to stop losses to the institution and its customers, and AML teams detect and report suspicious activity under the Bank Secrecy Act. One scam payment can involve both.
Does Every Fraud Case Require a Suspicious Activity Report?
No. A SAR is required when the institution knows, suspects or has reason to suspect a crime or BSA-related activity and the amount meets a threshold. Under the OCC’s rule at 12 CFR 21.11, those are insider abuse in any amount, $5,000 or more with an identifiable suspect, $25,000 or more regardless of a suspect, and $5,000 or more for possible money laundering or BSA evasion. The NCUA rule for federally insured credit unions, 12 CFR 748.1(d), sets the same tiers.
Does FRAML Require Merging the Fraud and AML Teams?
No regulation requires a merged team, and the FFIEC BSA/AML Examination Manual already contemplates BSA and fraud as separate departments. Examiners test whether referrals move, on what timeline, and whether the SAR decision record shows it.
The Predict360 Enterprise Risk Management Software ensures managers have complete visibility of enterprise risk on a single dashboard.
Request Demo- Cloud-Based
- Risk Repository
- Assess Risks
- Real-time Monitoring