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FinCen Issues Statement Regarding Publication of Suspicious Activity Reports (SARs)

On September 1, 2020, the Financial Crimes Network (“FinCEN”) issued a statement regarding various media outlets’ intent to publish Suspicious Activity Reports (“SARs”) and “other sensitive government documents”.   The full statement may be found here. The release offers no changes regarding  the unauthorized disclosure of SARs,  and serves to remind everyone, including media outlets,  that publishing unlawfully disclosed information is a crime.  FinCEN has referred the matter to both the Department of Justice and the Department of the Treasury’s Office of Inspector General for further enforcement.

Generally, under the Bank Secrecy Act (“BSA”), U.S. financial institutions are required to file a SAR with FinCEN within 30 days if suspicious activity is detected in an account related to things like money laundering, fraud or terrorist financing. However, the BSA and other federal regulations specifically prohibit the unauthorized disclosure of the SAR, or any information that may reveal the existence of the SAR. This confidentiality requirement is taken seriously by the Government, and disclosure of the contents in (or mere existence of) a SAR is viewed by law enforcement to be a serious matter. Accordingly, the penalties can be severe.  Federal law provides for civil penalties of up to $100,000 for each violation, and criminal penalties including fines of up to $250,000 and/or imprisonment of up to 5 years. 31 U.S.C. § 5322 and 31 U.S.C. § 1010.840. Further, enforcement actions for sub-standard AML compliance on the part of the filing institution can go hand-in-hand with charges of an unauthorized SAR disclosure-- once the SAR is in the public eye and no longer confidential.

The key is always to err on the side of non-disclosure.  Once a SAR is disclosed, it can’t be undone, and if disclosure was improper, penalties will no doubt follow. Further, the conduct of the institution in connection with the leak of the SAR, as well as in the underlying handling of the transactions at issue, create significant risk to the company and its employees.  Simply put, make certain that you have a valid reason to disclose any SAR-related information, and seek legal guidance if there is any uncertainty whatsoever.

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©1994-2021 Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. All Rights Reserved.National Law Review, Volume X, Number 247
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Eoin P. Beirne, Mintz, White Collar Crime Investigations Attorney, FCPA Violations Lawyer,
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Eóin is an accomplished white collar defense lawyer who resourcefully shepherds individual and corporate clients through government investigations and enforcement proceedings. He represents clients in a wide variety of industries in state and federal courts and before an array of investigative and enforcement bodies. Eóin routinely represents Boards of Directors or Board committees conducting internal investigations. He counsels clients on a variety of matters including wire and mail fraud, health care fraud, public corruption, insider trading, and violations of the False Claims Act and...

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Cory Flashner White Collar Defense Attorney Mintz
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Cory is a white collar defense attorney and former federal and state prosecutor whose practice encompasses representing individuals and companies in investigations and enforcement actions related to financial laws and advising them on compliance. He has particular experience with securities laws, anti-money laundering laws and regulations and primarily serves clients in the financial services sector.

Prior to joining Mintz, Cory was a vice president and the regional head of the anti-money laundering (AML) division for North America at a Boston-...

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Pete S. Michaels MIntz Member Securities Litigation White Collar Defense & Government Investigations Arbitration, Mediation,
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Pete focuses his practice on securities litigation, regulatory proceedings involving financial service companies and products, and compliance matters. He represents multinational and regional financial services firms, including banks, broker-dealers, investment advisers, mutual fund firms, and insurance companies as well as their employees, directors, and officers.

Pete’s extensive experience with securities disputes includes class actions, state and federal court cases, arbitration, and related employment matters. He also represents clients before a wide range of federal, state and...

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Jason L. Burrell Associate Complex Commercial Litigation Financial Institution Litigation White Collar Defense & Government Investigations Securities Litigation Class Action Health Care Enforcement & Investigations
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Jason practices in the firm’s litigation section, and has experience in complex commercial litigation, including representing financial institutions, closely-held corporations and publicly traded companies. Additionally, Jason has experience drafting discovery responses and conducting and managing confidential document review for production. Jason has also worked on matters relating to investor disputes, government investigations, and enforcement proceedings.

During law school, Jason served as editor-in-chief of the Northeastern University Law Review. Also, Jason was a...

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