## Facts

- L & J Crew Station, LLC operated a money-transmission business.
- L & J opened two deposit accounts at Banco Popular in June and July 2002 and signed a deposit agreement addendum allowing either party to cancel the service upon written notice; notice mailed at least ten days before termination was deemed reasonable.
- L & J did not disclose to Banco Popular that it was engaged in money transmission when it opened the accounts.
- Banco Popular became concerned about the nature, volume, and amounts of L & J’s transactions and investigated L & J’s business operations and controls.
- Banco Popular concluded L & J had insufficient internal controls and lacked or did not follow an effective anti-money-laundering program.
- In September 2002, Banco Popular gave written notice terminating the accounts, citing regulatory and compliance burdens tied to federal anti-money-laundering requirements.
- L & J opened a FirstBank account in November 2002 without disclosing its money-transmission business or Banco Popular’s prior termination notice.
- FirstBank notified L & J in December 2002 that it would close the account and closed it in January 2003.
- L & J sued both banks, alleging they wrongfully relied on the USA PATRIOT Act and related regulations to terminate its accounts and caused business harm.

## Issues

1. Whether the USA PATRIOT Act and related Bank Secrecy Act provisions create an express or implied private right of action permitting a customer to sue a bank over account-closure decisions.
2. Whether the banks breached their deposit agreements by terminating L & J’s accounts after providing written notice as required by the contracts.
3. Whether the complaint stated any viable tort or statutory claim under federal law or Virgin Islands law based on alleged “misuse” of anti-money-laundering laws or related bad-faith theories.

## Decision

- The court granted the banks’ Rule 12(b)(6) motion and dismissed the first amended complaint in its entirety.
- The court held the PATRIOT Act and the BSA provisions invoked by L & J do not provide a private cause of action for customers challenging banks’ compliance-driven account closures.
- The court held the contractual documents unambiguously allowed termination upon written notice, and the complaint did not plead a breach of those notice-based termination provisions.
- The court held the remaining tort and statutory theories failed because L & J did not identify an independent legal duty overriding the banks’ contractual termination rights or supplying a cognizable claim.

## Legal Principles

- Federal anti-money-laundering statutes such as the USA PATRIOT Act and Bank Secrecy Act generally are enforced through governmental and regulatory mechanisms and do not, without clear congressional intent, create private rights of action for bank customers.
- When a deposit agreement unambiguously permits either party to terminate the relationship at will upon notice, an account closure consistent with those terms does not constitute breach absent well-pleaded facts showing violation of some separate duty.
- Allegations that a bank “wrongfully relied” on federal compliance obligations do not state a claim without a recognized statutory remedy or a plausible common-law duty breached by the bank.

## Conclusion

The court dismissed L & J’s claims because the federal anti-money-laundering statutes it cited did not authorize private lawsuits against banks for compliance-related account closures, and the deposit agreements allowed the banks to terminate the accounts upon written notice, leaving no adequately pleaded contractual, tort, or statutory basis for relief.


L & J Crew Station, LLC v. Banco Popular de P.R., 278 F. Supp. 2d 547 (D.V.I. 2003)