U.S. Extraterritorial Discovery Considerations for Foreign Banking Organizations
Financial Institutions Group attorneys Jeffrey Alberts and Dustin N. Nofziger have published an article titled, “U.S. Extraterritorial Discovery Considerations for Foreign Banking Organizations" that appeared in the May 2021 edition of The Review of Banking & Financial Services.
Foreign banks that have U.S. offices or U.S. correspondent accounts may, in certain cases, be compelled to produce documents located abroad by subpoenas from U.S. government agencies or civil litigants. In this article, Jeff and Dustin discuss the various avenues for such discovery, focusing first on grand jury subpoenas to two Chinese banks and next on the government’s recently expanded authority to issue Patriot Act subpoenas. They then turn to civil subpoenas under the Federal Rules of Civil Procedure in a case involving extraterritorial discovery from a U.S. bank subsidiary of a foreign banking organization.
Recent judicial decisions have clarified, and in some cases modified, the avenues that government agencies and civil litigants can take within the U.S. judicial system to obtain bank documents that are located outside of the U.S. In addition, the recently enacted National Defense Authorization Act for Fiscal Year 2021 (“NDAA”)1 substantially expands the authority of the Secretary of the Treasury and the Attorney General to issue Patriot Act subpoenas to foreign banks with U.S. correspondent accounts. Foreign banking organizations should be aware of the following legal mechanisms for compelling extraterritorial discovery, as well as the limitations that courts recently have placed or may place on them.
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