STRs Explained: When to Report, Why It Matters, and How to Stay Compliant

Suspicious Transaction Reports or STRs are one of the most misunderstood parts of FICA compliance.

Many accountable institutions hesitate to submit STRs because they think they need proof. Others worry about upsetting clients or getting it wrong.

The truth is much simpler. You do not need proof. You need reasonable suspicion.

Understanding this difference can save your business from serious compliance risk.

What Is an STR

An STR is a report submitted to the Financial Intelligence Centre or FIC when you suspect that a transaction or client activity may involve

• Proceeds of unlawful activities

• Money laundering

• Terrorist financing

• Unusual or unexplained behaviour

STRs are required under the Financial Intelligence Centre Act and apply to all accountable institutions including financial services providers.

The purpose of an STR is not to accuse your client. It is to alert authorities so they can assess the activity further.

When Must You Report

You must submit an STR as soon as possible after suspicion arises and no later than fifteen days from becoming aware of the suspicious activity.

Not when you have certainty. Not when you have finished investigating. Not when you feel more comfortable.

Suspicion alone triggers the obligation.

This can arise during client onboarding, reviewing source of funds, ongoing monitoring or transaction reviews.

Some common red flags include

• Clients refusing or delaying FICA documents

• Inconsistent explanations about source of funds

• Transactions that do not align with a client’s risk profile

• Complex company structures with no clear business purpose

• Sudden changes in behaviour or transaction patterns

If something feels off, that is usually your signal.

A Real Life Example

Let us say you onboard a new client who claims to run a small consulting business.

They provide basic FICA documents but when asked about the source of funds their explanation keeps changing. Shortly after onboarding they request to move a large amount of money through your platform that does not match their stated business activity.

You do not have proof of wrongdoing. But you do have reasonable grounds to be concerned.

That is enough.

This is exactly when an STR should be submitted. Remember, it must be submitted within fifteen days from when you became aware of the suspicion.

Waiting to see what happens or asking more questions before reporting can result in late submission which is one of the most common compliance findings.

You Do Not Need Proof to Submit an STR

FICA does not require certainty. It requires reasonable suspicion.

Suspicion can be based on behaviour, inconsistencies, patterns or context. Often it is a combination of small things that do not add up.

Trust your compliance judgment.

Why Timely Reporting Matters

STRs must be submitted promptly once suspicion exists.

Delays can expose your business to

• Regulatory penalties

• Adverse inspection findings

• Reputational damage

Beyond compliance, STRs help protect South Africa’s financial system from fraud and organised crime. They matter.

STRs Are About Protection Not Accusation

Many FSPs fear damaging client relationships.

But submitting an STR does not mean you are accusing your client of a crime. It means you are fulfilling a legal obligation.

Reports are confidential. Clients are not notified and FICA protects you when reporting in good faith.

Think of STRs as part of your compliance safety net. They protect your business, your clients and the wider financial system.

A Simple Compliance Mindset Shift

Instead of asking

Am I sure something illegal is happening

Ask:

Do I have reasonable grounds to be concerned

That small shift makes compliance clearer and more manageable.

Final Thoughts

STRs are not optional. They are a core part of FICA compliance.

Understanding when and why to report empowers FSPs to act confidently, reduce regulatory risk and contribute to a safer financial environment.

Compliance does not have to feel overwhelming when you understand the fundamentals.

Need Help With FIC Compliance

If you are unsure about STRs, reporting timelines or FICA compliance in general we can help.

Contact us today for expert guidance and practical solutions to keep your business compliant and audit ready.