## Facts

- Federal tax authorities investigated “T.W.” for possible tax offenses involving undisclosed offshore bank accounts.
- A grand jury subpoena (dated September 12, 2011) ordered T.W. to produce records for October 2006 to the present that are required to be maintained under the Bank Secrecy Act (BSA) and its implementing regulation, then codified at 31 C.F.R. § 103.32 (now 31 C.F.R. § 1010.420).
- The subpoena sought account-related information a U.S. person must retain for foreign financial accounts over which the person has a financial interest or signature authority.
- T.W. moved to quash, asserting Fifth Amendment privilege on the theory that production would be testimonial and incriminating by admitting the existence, control, and authenticity of foreign account records.
- T.W. also argued that even a claim of nonpossession would be incriminating because failure to keep required BSA records can be criminally punished.
- The government argued that the Required Records Doctrine removes these documents from Fifth Amendment protection.

## Issues

1. Whether the Required Records Doctrine remains valid after modern Fifth Amendment “act of production” jurisprudence.
2. Whether BSA-required foreign account records fall within the Required Records Doctrine so that the Fifth Amendment does not bar compelled production in response to a grand jury subpoena.

## Decision

- The Seventh Circuit reversed the district court’s order quashing the subpoena and remanded.
- The court held the Required Records Doctrine remains controlling law and is not displaced by act-of-production cases.
- The court held the subpoenaed BSA foreign account records satisfy the doctrine’s three-part test.
- The court required T.W. to produce the subpoenaed records despite claimed testimonial and incriminating aspects of production.

## Legal Principles

- Under the Required Records Doctrine, the Fifth Amendment privilege does not protect records an individual is legally required to keep pursuant to a valid, essentially regulatory regime when the records are customarily kept and have public aspects.
- The doctrine applies even if producing the required records would communicate testimonial facts (existence, possession, or authenticity); otherwise the doctrine would be ineffective in practice.
- A regulatory scheme does not cease being “essentially regulatory” merely because violations carry criminal penalties.
- BSA foreign-account recordkeeping requirements under 31 C.F.R. § 1010.420 are part of an essentially regulatory program, seek information account holders ordinarily retain, and impose recordkeeping duties that give the records public aspects.

## Conclusion

The Seventh Circuit enforced a grand jury subpoena for BSA-required foreign account records, holding that the Required Records Doctrine defeats Fifth Amendment and act-of-production objections when the subpoena seeks records mandated by an essentially regulatory recordkeeping regime.


In re Special February 2011-1 Grand Jury Subpoena Dated September 12, 2011, 691 F.3d 903 (7th Cir. 2012)