Question & Answer
Question: If we want the Federal Bureau of Investigation to investigate or prosecute a case for us in which we have taken a loss, can we give them copies of records without a subpoena? Are we breaking any rules concerning financial privacy if we do?
Answer: Any suspected criminal violation against a federally insured institution is a federal offense, and must be reported to the proper authorities. Part of that reporting requirement is the preparation and delivery of the Criminal Referral Form, a copy of which is sent to your regulatory agency, as well as to the proper law enforcement agency (in many cases, the FBI).
The Criminal Referral Form requires a full explanation of the crime, and requests documentation as part of the report. It does not require the submission of records without a subpoena.
The Financial Privacy Act does not address the Criminal Referral Form.
We are hoping with the revision of the Criminal Referral Form that some direction may be given regarding this matter. Financial institutions have, as part of the investigation, provided law enforcement with copies of records involved when the institution is the victim and is in a loss position. There was a recent ruling, however, on an institution providing records to the IRS without subpoena. The institution was fined for "volunteering" the records. This court decision makes other institutions hesitant about supplying records, even when the records are needed to document the case.
Talk to the law enforcement agency that needs the records for prosecution. Explain to them your hesitancy. The subpoena is easy enough for them to get, and it protects you from litigation.
Copyright © 1991 Bankers' Hotline. Originally appeared in Bankers' Hotline, Vol. 2, No. 10, 11/91
First published on 11/01/1991