There are several teaching points in this one, but the continuing trend in referring to the "effects" of failing to file SARs on the public is disturbing:

“The criminal case affected the lives of thousands of children and parents...”

There are far too many SARs filed that do not generate an LEA response to assume that law enforcement would have acted on these unfiled SARs, thus averting the effects of a third party's illegal acts. If the bank broke the law, punish it and skip the "official" moral indignation. It doesn't sell and it dilutes the real issues.

This is sad--you hear more and more of this kind of thing all the time. Shame on them.

I don't know - the information attached points out that the bank complied with a subpoena, and if it were a grand jury subpoena (articles don't state what type of subpoena it was) those are not supposed to be mentioned in A SAR.
the take away for me is any time you get a grand jury subpoena do a investigation document the results of your investigation and then document why you are not filing a SAR.
I am not for sure what the relevance of the guy being a director is on this (again if it were a grand jury subpoena you are not allowed to tell the subject that you have received one).

I am probably dwelling too much on the subpoena aspect, and probably there were other red flags that should have triggered a SAR that were ignored by the bank.

The subpoena should have triggered some enhanced due diligence on the object of the investigation and his activities. If the investigation turned up suspicious activity the bank would have been obligated to file the SAR. They would not have been obligated to say what started the investigation; i.e. they could have filed a full and complete SAR without ever mentioning the subpoena.

That wisdom originated with the AmSouth CMP from 2004.

FinCEN didn't make anything of the director relationship. Nor should they. I did that because this is a banking audience and I wanted people to read the article!

ok, thanks Ken.

I do recall the press coverage when those judges were exposed for what they were, and their behavior was reprehensible. And I remember when reading this CMP order wondering whether one of the reasons there was no further investigation or a SAR filing is that one of the defrocked judges was a board member.