A financial institution receives a request from a foreign FIU for information about a customer's transactions. What should be the first step?

While international cooperation is important, providing information immediately without verification can lead to breaches of local laws and regulations. Institutions must first ascertain the validity of the request to ensure they are not inadvertently violating any privacy or confidentiality laws.

Filing a suspicious activity report (SAR) is appropriate only when there is suspicion of illegal activity related to a customer's transactions. A request from a foreign FIU does not inherently indicate suspicious activity; thus, filing a SAR without proper evaluation may not be justified and could lead to unnecessary regulatory scrutiny.

Notifying the customer can compromise the investigation or violate legal obligations, particularly if the request pertains to ongoing investigations or security matters. Institutions must prioritize compliance with legal obligations over customer notification in such scenarios.