In a recent decision by the Second Circuit Court of Appeals, appellant “John Doe” appealed from the district court’s order holding him contempt for failure to comply with a grand jury subpoena and requiring Doe to pay $1,000 per day until he complies. The subpoena sought records of Doe’s foreign bank accounts which the Bank Secrecy Act requires United States resident account holders in foreign banks to maintain. 13 C.F.R. § 1010.420. Specifically, the subpoena sought the names of the account holders, the banks, the account numbers, the types of accounts, and the maximum value of the accounts, which is information that by law must be reported to the Commissioner of the Internal Revenue Service. Doe resisted production, asserting that the Fifth Amendment privilege against self incrimination excused his non-production.
In affirming the district court’s contempt finding, the Second Circuit held that the “required records” exception to the Fifth Amendment privilege applied here, thus overriding the assertion of Fifth Amendment protection. The court cited a U.S. Supreme Court three factor test to determine whether documents are “required records”: (1) the purpose of the United States’ inquiry must be essentially regulatory, (2) information is to be obtained by requiring the preservation of records of a kind which the regulated party has customarily kept; and (3) the records themselves must have assumed “public aspects” which render them at least analogous to public documents. Grosso v. United States, 390 U.S. 62 (1968). Finding that all three factors were satisfied here, the court found that the required records exception applied thereby trumping Doe’s privilege against self incrimination. In re: Grand Jury Subpoena Dated February 2, 2012, 13-cv-403 (2d Cir. Dec. 23, 2013).