Circular
Interagency Advisory Concerning Legal Protections for Filing of Suspicious Activity Reports
May 27, 2004
Circular No. 11601

To All Depository Institutions and Others Concerned in the Second Federal Reserve District:

Federal law provides protection from civil liability to financial institutions and their employees who report suspicious or potentially criminal activity to the appropriate law enforcement and bank supervisory authorities in Suspicious Activity Reports (SARs). A recent federal court case reaffirmed the scope of this statutory protection, which generally referred to as a "safe harbor."

In a supervisory letter (SR 04-8) dated May 24, 2004, the Federal Reserve Board announced the issuance of an Interagency Advisory discussing the facts, holding, and implications of the court decision. Apart from the Board other federal financial institutions supervisory agencies and the U.S. Department of the Treasury’s Financial Crimes Enforcement Network prepared the Advisory.

The Advisory also provides useful information regarding steps that banking organizations should take to better ensure that they are fully protected under the law. Further, the Advisory states that, in the opinions of the staffs of the banking agencies, financial institutions and their employees who follow their respective agencies’ SAR regulations and the filing instructions should be fully protected by the "safe harbor" provisions of the federal law.

SR letter (SR 04-8) OFFSITE
Interagency Advisory OFFSITE PDF

Contact:
Nicholas Farco
Examining Officer
Legal and Compliance Risk Department
nicholas.farco@ny.frb.org