Question 43

Have the institution's assigned legal counsel review the subpoena.

It is essential for a financial institution to have its assigned legal counsel review a grand-jury subpoena regarding a customer to ensure compliance with legal requirements and to protect the institution's interests.

A) Keep the customer's accounts open at the enforcement agency's verbal request.

This option is incorrect as it does not address the legal implications of responding to a subpoena. Keeping accounts open based on a verbal request from an enforcement agency could expose the institution to legal risks and does not follow proper legal protocol.

B) Notify the customer being investigated before submitting documents.

While notifying the customer may seem considerate, it is often inappropriate in the context of a grand-jury subpoena. Such notification could potentially compromise the investigation, as the customer may alter their behavior or destroy evidence.

C) Have the institution's assigned legal counsel review the subpoena.

This option is correct as it ensures that the financial institution adheres to legal standards and understands the implications of the subpoena. Legal counsel can provide guidance on how to respond appropriately and protect the institution's rights and responsibilities.

D) Make copies of the customer's documents and submit the originals to the enforcement agency.

This option is incorrect because submitting original documents without legal counsel's review could violate regulations and jeopardize the institution's compliance. It is crucial to handle subpoenas carefully to avoid any adverse legal consequences.

Conclusion

The correct action is for a financial institution to have its assigned legal counsel review the subpoena, as this ensures compliance with legal standards and protects the institution's interests. Other options either involve inappropriate responses to the subpoena or could compromise the investigation, highlighting the importance of legal oversight in such situations.