From Manual to Automated Fraud Reporting in U.S. Financial Institutions: Change Management Strategies and Measurable Impact - A Narrative Review

Abstract

For many years, U.S. financial institutions have relied on manual, investigator-based workflows to generate Suspicious Activity Reports (SARs). In today's era of financial crime, filing of SARs under the Bank Secrecy Act (BSA) continues to be inefficient, time-consuming, and prone to error. Manual reporting is a huge challenge as consumers report $12.5 billion in fraud losses in 2024 and financial institutions report more than 4 million SARs each year. Today, institutions have spent a lot of money on automated fraud detection and RegTech solutions and yet, despite these investments, not many institutions can reap significant benefits since automated solutions are often thought of as technology solutions, and not as a transformation of the organization, its processes and people. This narrative review collates peer-reviewed literature across the four themes of the organizational and structural drivers for the transition, change management frameworks for adoption, design and governance characteristics of automated systems, and measured business and compliance impact on the transition to automated systems from 2020 until 2026. However, results from the review demonstrate that the ability to implement structured change management, explain systems to the regulator, align the system with the regulation, and measure performance are significant to achieving automation success, and not just the technical capability itself. These results give compliance officers and financial institution executives a single source of evidence to inform their fraud reporting automation investments and maximize impact.