9th Circuit Applies Required Records Doctrine to Defeat 5th Amendment Claim for FBAR Recordkeeping (8/19/11)

The Ninth Circuit today issued an opinion applying the required records doctrine to defeat a Fifth Amendment claim related to the FBAR record keeping requirement. The opinion is in In re: GRAND JURY INVESTIGATION M.H. and can be reviewed or downloaded here. I have not had time to analyze the opinion and so can just post it for readers now. If and when I have time, I may supplement this blog entry. 

Addendum 8/19/11:  Here is the conclusion (p. 20 of the slip opinoin):

IV

Because the records sought through the subpoena fall under the Required Records Doctrine, the Fifth Amendment privilege against self-incrimination is inapplicable, and M.H. may not invoke it to resist compliance with the subpoena’s command. See Doe M.D., 801 F.2d at 1167 (“Records that are required to be maintained by law are outside the scope of the privilege [against self-incrimination].”). Because M.H.’s Fifth Amendment privilege is not implicated, we need not address his request for immunity. Bouknight, 493 U.S. at 562 (declining to “define the precise limitations that may exist upon the State’s ability to use the testimonial aspects of Bouknight’s act of production in subsequent criminal proceedings”).

The district court’s order is AFFIRMED.

Addendum 8/20/11:  JAT comments on the decision:
Read more »

Foreign Bank Account Records and the Required Records Exception to the Act of Production Doctrine

For those exposed on foreign accounts (i.e., no FBARs and no income tax reporting), the Government is brandishing a weapon that some taxpayers may not anticipate -- end-runs around the Fifth Amendment that would otherwise apply to avoid incriminating oneself. The end-runs are the "required records" exception to the Fifth Amendment and possibly the "foregone conclusion" exception to a Fifth Amendment act of production claim. I have previously blogged on the foregone conclusion exception here and focus here on the required records exception.

Just for background, there is now no Fifth Amendment privilege for the contents of documents (not even diaries which are, after all, not made under compulsion), but there is a Fifth Amendment privilege under the "act of production" doctrine relating to the testimonial aspects of compulsory production of documents (i.e., identifying documents, acknowledging their existence, etc.). So, the Fifth Amendment privilege is alive and well for compulsory document production in many cases. Hence, the Government needs end-runs such as the required records exception and the foregone conclusion exception.

Read more »