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White Collar + Fraud + Investigations + Compliance
Musings of a Former DOJ Trial Attorney: Let’s talk bank exam privilege. As most practitioners in this space are aware, documents and communications relating to the supervisory role of bank regulators are protected under bank exam privilege. It’s also commonly understood that the privilege itself is owned by the bank regulator, not the financial institution. How does that play out in the real life of an AUSA or DOJ Trial Attorney investigating the financial institution or issues involving the financial institution? Well, oftentimes, financial institutions will redact communications with the bank regulator and internal documents and communications involving that exam. What financial institutions don’t anticipate is that the bank regulator may waive the privilege related to specific exams. In other words, if the bank regulator grants that waiver, and to the extent that no other privilege applies, those previously protected documents and communications lose that protection.
As one of the few practitioners in this space, at DOJ, I would regularly use this tool. Now, as a member of the defense bar, here are a few questions to consider: Does your institution discuss issues that would ordinarily be protected under the bank exam privilege more freely in light of that protection? Is your institution aware that the regulator could waive that privilege and the DOJ could potentially review those internal discussions?
This is particularly interesting if the exam is more targeted and focused on particular types of conduct. These are key points to consider when you are facing a DOJ investigation, particularly in the context of FIRREA.
Partner|Denise Barnes is a former U.S. Department of Justice (“DOJ”) Trial Attorney who focuses her practice on compliance, white collar and regulatory investigations, and complex commercial litigation. She represents clients in ...