PRACTICAL SOLUTIONS
Before – and After – You Start
Talking to Law Enforcement
Important tips from the lawyers
E
veryone recognizes the importance
of cooperating with the law enforcement community and appreciates
how even a small bit of information may
provide the crucial detail that helps solve a
crime or prevent a terrorist act.
•
However, if you decide to pick up the phone to
call law enforcement, you want to ensure that
you are not creating any unwanted problems
for your institution — and possibly yourself.
For inside advice on how to avoid such consequences, I solicited the views of two of my
partners: Ted Planzos who served as an assistant district attorney in Bronx County, N.Y., a
special assistant U.S. attorney and the deputy
chief of the Organized Crime and Racketeering
Section at the U.S. Department of Justice; and
Sam Rosenthal, who was a former assistant
U.S. attorney and headed the Criminal Appellate Section of the U.S. Department of Justice.
Ted recently represented Pamrapo Savings
Bank in its negotiations with the Department
of Justice and federal regulators. Sam has
represented a number of banks and money
transmitters in criminal proceedings before
federal and state prosecutors.
•
Here is a list of pointers we developed for
your conversations with law enforcement.
• Circumstances will dictate. We all agree
that your communications with law
enforcement will depend on the circumstances, including whether you have
information about a customer or one of
your employees, whether an investigation
has already begun and what the nature
of the information is. For example, if
the information relates to an unfolding
criminal or terrorist act involving bodily
harm or destruction of property, you
likely will be asked to respond with
details more quickly than if the information relates to a prior violation with little
or no ongoing significance.
• Cooperation is the best policy. The
Federal Sentencing Guidelines make clear
that full cooperation with law enforcement
is a factor considered by prosecutors in
charging a corporation with money laundering or aiding or abetting in money laun40
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ACAMS TODAY | MARCH–MAY 2011 | ACAMS.ORG
dering. Should an employee be involved or
the institution otherwise implicated in the
activity, cooperation will be an important
mitigating factor for the prosecution and
the judge at sentencing.
You may be required to call. Financial
institutions should notify law enforcement
by telephone if the matter requires immediate attention (you also may be required to
call your regulator). The FFIEC BSA/AML
Examination Manual states: “for situations
requiring immediate attention, in addition
to filing a timely SAR, a bank must immediately notify, by telephone, an “appropriate
law enforcement authority” and, as necessary, the bank’s primary regulator.”
Be brief. Ted suggests the best strategy
is to keep the conversation brief. “You
only need to tell the investigators that
a SAR filing has been or will be made.
They can request the paper.” Sam notes
that “any conversation with law enforcement is a significant event whether you
call to report concerns about a customer
or an employee of the institution. Everything you say becomes evidentiary.” This
means that the information you provide
law enforcement in a conversation could
possibly be used against the institution at
a later date.
Disclose the SAR if requested and offer it
when appropriate. The new SAR disclosure regulations published in December
2010 generally prohibit the disclosure of
a SAR. However, the regulations provide
an important exception that permits an
institution to disclose to federal, state and
local law enforcement that a SAR has been
filed or facts that indicate the existence of
the SAR as long as the disclosure is not
made to a person involved in the suspicious transaction. The new regulation also
permits the institution to provide a copy of
the SAR to law enforcement.
A subpoena may still be required. The
new SAR disclosure regulations make
clear that a SAR can be disclosed to
law enforcement without a subpoena.
However, while the regulations permit
disclosure of the underlying facts, transactions and documents upon which
the SAR is based, the regulation does
not appear to eliminate the need for
a subpoena should law enforcement
request the underlying documents.
• Keep your legal counsel’s number close.
Whether you rely on inside or outside
counsel, you should not hesitate to
consult with your counsel if you have any
doubt about whether you should contact
law enforcement or what should be said
in the conversation. For example you
may consider consulting with counsel
as to whether a subpoena is required if
law enforcement makes a request for
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