The people v. confidentiality. (legal aspects of bank record disclosure)
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The people v. confidentiality. (legal aspects of bank record disclosure)

THE PEOPLE v CONFIDENTIALITY

You are the manager of the New York branch of a non-US bank. A grand jury subpoena -- a court order requiring the production of documents or the appearance of a witness -- is served on your requiring the bank to divulge records of a customer's account. Apparently the customer is suspected of an offence like insider trading -- dealing in shares on a US stock exchange on the basis of non-public information. There are problems: neither the client nor the bank's head office where the client's records are kept are in the US; the bank secrecy laws in the bank's home country prevent the bank from complying; and the US court says it will fine your branch $5,000 a say for contempt in failing to comply with the court order until the records are produced. What do you do?

First, study the terms of the court order. A subpoena is enforceable only if the person on whom it is served has custody of the records or control over them. In the past, New York branch managers have argued successfully that documents at head office are outside their custody and, because they have no authority over head office, outside their control.

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