The opinion
FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
In re: GRAND JURY INVESTIGATION
M.H.,
No. 11-55712
M.H.,
Witness-Appellant, D.C. No.
10-GJ-0200
v. OPINION
UNITED STATES OF AMERICA,
Appellee.
Appeal from the United States District Court
for the Southern District of California
Irma E. Gonzalez, Chief District Judge, Presiding
Argued and Submitted
June 24, 2011—Pasadena, California
Filed August 19, 2011
Before: William C. Canby, Jr., Ronald M. Gould, and
Richard C. Tallman, Circuit Judges.
Opinion by Judge Tallman
11233
IN RE GRAND JURY INVESTIGATION M.H. 11237
COUNSEL
Pamela J. Naughton and Rebecca S. Roberts, Sheppard Mul-
lin Richter & Hampton LLP, San Diego, California, for appel-
lant M.H.
Frank P. Cihlar, Gregory Victor Davis, Alexander P. Robbins,
Tax Division, Department of Justice, Washington, D.C., for
appellee United States of America.
OPINION
TALLMAN, Circuit Judge:
Appellant M.H. is the target of a grand jury investigation
seeking to determine whether he used secret Swiss bank
11238 IN RE GRAND JURY INVESTIGATION M.H.
accounts to evade paying federal taxes. The district court
granted a motion to compel M.H.’s compliance with a grand
jury subpoena duces tecum demanding that he produce certain
records related to his foreign bank accounts. The court
declined to condition its order compelling production upon a
grant of limited immunity and, pursuant to the recalcitrant
witness statute, 28 U.S.C. § 1826, held M.H. in contempt for
refusing to comply. M.H. appealed.
The foreign bank account information the Government
seeks is information M.H. is required to keep and maintain for
inspection under the Bank Secrecy Act of 1970 (BSA), 31
U.S.C. § 5311, and its related regulations. M.H. argues that if
he provides the sought-after information, he risks incriminat-
ing himself in violation of his Fifth Amendment privilege. He
asserts that the information he is being asked to produce
might conflict with other information M.H. has previously
reported to the Internal Revenue Service (IRS). Production
might reveal, for instance, that he has accounts he has not
reported or that the information he has previously reported is
inaccurate. On the other hand, if M.H. denies having the
records, he risks incriminating himself because failing to keep
the information when required to do so is a felony.
The district court concluded that under the Required
Records Doctrine, the Fifth Amendment did not apply. That
doctrine recognizes that when certain conditions are met,
records required to be maintained by law fall outside the
scope of the privilege. We agree that, under the Required
Records Doctrine, the Fifth Amendment does not apply. We
therefore affirm the district court’s order of contempt for fail-
ing to produce the information the grand jury sought.
I
In 2009, as part of a deferred-prosecution agreement with
the United States Department of Justice, the Swiss bank UBS
AG (UBS) provided the federal government with bank
IN RE GRAND JURY INVESTIGATION M.H. 11239
account records identifying approximately 250 U.S. taxpayers
UBS might have aided in committing tax evasion. The UBS
records showed that in 2002, M.H. transferred securities from
his UBS account to a different Swiss bank, UEB Geneva. IRS
agents began investigating him.
In June 2010, a San Diego federal grand jury issued a sub-
poena duces tecum to M.H. for records he was required to
keep pursuant to Treasury Department regulations governing
offshore banking. The subpoena demanded production of:
[a]ny and all records required to be maintained pur-
suant to 31 C.F.R. § 103.32 [subsequently relocated
to 31 C.F.R. § 1010.420] relating to foreign financial
accounts that you had/have a financial interest in, or
signature authority over, including records reflecting
the name in which each such account is maintained,
the number or other designation of such account, the
name and address of the foreign bank or other per-
son with whom such account is maintained, the type
of such account, and the maximum value of each
such account during each specified year.
(Emphasis added).1 M.H. declined to provide the requested
information and also declined to deny having it, reasoning
that either response posed a risk of self-incrimination under
the Fifth Amendment to the United States Constitution. The
district court ordered him to comply anyway. When he again
refused to produce the requested documents, the court con-
ducted a show-cause hearing for failing to comply with its
order and found him in contempt. However, because the dis-
trict court considered M.H.’s arguments “substantial and wor-
thy of appellate review,” the court stayed the contempt order
pending appeal, contingent on M.H.’s posting of a $250,000
1
The regulation cited in the subpoena, 31 C.F.R. § 103.32, has since
been relocated to 31 C.F.R. § 1010.420. For ease of reference, this opinion
will refer to the current citation.
11240 IN RE GRAND JURY INVESTIGATION M.H.
cash bond. M.H. is not currently incarcerated and may travel
without restriction.
The information identified in the subpoena mirrors the
banking information that 31 C.F.R. § 1010.4202 requires tax-
payers using offshore bank accounts to keep and maintain for
government inspection. The information the subpoena seeks
is also identical to information that anyone subject to
§ 1010.420 already reports to the IRS annually through Form
TD F 90-22.1, known as a “Report of Foreign Bank and
Financial Accounts,” or “FBAR.” Therefore, the information
at issue in this contempt proceeding is information that M.H.
—if he has a foreign bank account and meets other qualifica-
tions specified in the BSA—must keep, report to the Treasury
Department, and maintain for IRS inspection.
II
We review de novo mixed questions of law and fact con-
tained within the analysis of a civil contempt proceeding.
Shoen v. Shoen, 48 F.3d 412, 414 (9th Cir. 1995). We review
for clear error any factual findings underlying the contuma-
cious behavior. United States v. Bright, 596 F.3d 683, 694
(9th Cir. 2010). Where incarceration has been stayed pending
appeal and no party is harmed by the delay, we may exceed
2
The regulation reads, in relevant part:
Records of accounts required by [31 C.F.R. § 103.24 (relocated
to 31 C.F.R. § 1010.350)] to be reported to the Commissioner of
Internal Revenue shall be retained by each person having a finan-
cial interest in or signature or other authority over any such
account. Such records shall contain the name in which each such
account is maintained, the number or other designation of such
account, the name and address of the foreign bank or other person
with whom such account is maintained, the type of such account,
and the maximum value of each such account during the report-
ing period. Such records shall be retained for a period of 5 years
and shall be kept at all times available for inspection as autho-
rized by law.
IN RE GRAND JURY INVESTIGATION M.H. 11241
the thirty-day time limit for deciding appeals that § 1826
would otherwise impose. In re Grand Jury Witness, 695 F.2d
359, 361 n.4 (9th Cir. 1982).
III
A
[1] As a preliminary matter, M.H. argues that—for a num-
ber of reasons—§ 1010.420 does not apply to him, so he is
not required to comply with the grand jury’s subpoena and we
need not reach the Fifth Amendment question. But at this
point in its investigation, the Government need not prove the
regulation or the BSA apply. It need only show a “reasonable
possibility” that the subpoena will serve the grand jury’s legit-
imate investigative purpose. United States v. R. Enters., Inc.,
498 U.S. 292, 300-01 (1991).
The Government is not required to justify the issuance of
a grand jury subpoena by presenting evidence sufficient to
establish probable cause because the very purpose of its
inquiry is to establish whether probable cause exists to accuse
the taxpayer of violating our tax laws. See id. at 297 (“The
grand jury occupies a unique role in our criminal justice sys-
tem. It is an investigatory body charged with the responsibil-
ity of determining whether or not a crime has been
committed. Unlike this Court, whose jurisdiction is predicated
on a specific case or controversy, the grand jury ‘can investi-
gate merely on suspicion that the law is being violated, or
even just because it wants assurance that it is not.’ ” (citation
omitted)).
[2] There are, of course, limits to the grand jury’s author-
ity. See, e.g, id. at 299 (stating that a grand jury may not “en-
gage in arbitrary fishing expeditions” or base its investigation
on “malice or an intent to harass”). But there is no evidence
of excess here. We have examined the evidence in the sealed
record along with the evidence the district court reviewed in
11242 IN RE GRAND JURY INVESTIGATION M.H.
camera. That evidence confirms that the grand jury’s inquiry
is a legitimate exercise of its investigatory authority. If it is
later established that, for whatever legal reason, the regulation
at issue does not apply to M.H., then the Government will be
unable to successfully prosecute him and there is no risk of
a Fifth Amendment violation. Until then, however, M.H.’s
obligation to comply with the grand jury subpoena is not con-
tingent upon whether the Government has proven the BSA
and its regulations apply to him as a U.S. taxpayer who has
previously filed FBARs with the Department of the Treasury.
B
[3] M.H. argues that the Required Records Doctrine—
which, if it applies, renders the Fifth Amendment privilege
inapplicable—does not apply to this case and that the district
court erred in finding otherwise. The Fifth Amendment to the
United States Constitution states that “[n]o person . . . shall
be compelled in any criminal case to be a witness against
himself.” The Supreme Court has held that where documents
are voluntarily created and kept, compelling their disclosure
does not implicate the privilege against self-incrimination. See
United States v. Doe, 465 U.S. 605, 611-12 (1984) (citing
Fisher v. United States, 425 U.S. 391, 409-10 (1976)). Where
documents are required to be kept and then produced, they
are arguably compelled. However, the Supreme Court has rec-
ognized that in such circumstances, the privilege does not
extend to records required to be kept as a result of an individ-
ual’s voluntary participation in a regulated activity. See Sha-
piro v. United States, 335 U.S. 1, 17 (1948) (noting that the
nature of documents and the capacity in which they are held
may indicate that “the custodian has voluntarily assumed a
duty which overrides his claim of privilege” (quoting Wilson
v. United States, 221 U.S. 361, 380 (1911))). Our task is to
determine whether the records sought in this case fall into the
former or latter category. If they fall into the latter, the
Required Records Doctrine applies and the privilege is
IN RE GRAND JURY INVESTIGATION M.H. 11243
unavailable to M.H., who has voluntarily participated in a reg-
ulated activity.
[4] In Shapiro—credited for establishing the principles of
what has come to be known as the Required Records Doctrine
—the Supreme Court required a wholesaler of fruit and pro-
duce to turn over certain records he was obliged to keep and
maintain for examination pursuant to the Emergency Price
Control Act, which applied in part to records “customarily
kept.” See Marchetti v. United States, 390 U.S. 39, 55 (1968).
The Court reasoned that the Required Records “principle
applies not only to public documents in public offices, but
also to records required by law to be kept in order that there
may be suitable information of transactions which are the
appropriate subjects of governmental regulation, and the
enforcement of restrictions validly established.” Shapiro, 335
U.S. at 17.
Twenty years after Shapiro, the Court considered two cases
that examined whether being required to pay an excise tax on
one’s gambling wagers violated the Fifth Amendment. Those
two cases were Marchetti and Grosso v. United States, 390
U.S. 62 (1968). In its analysis in those cases, the Court identi-
fied three principles from Shapiro that distinguished it from
Grosso and Marchetti where, the Court concluded, the
Required Records Doctrine did not apply. See Marchetti, 390
U.S. at 56-57 (“We think that neither Shapiro nor the cases
upon which it relied are applicable here. . . . Each of the three
principal elements of the [Required Records Doctrine], as it
is described in Shapiro, is absent from this situation.”);
Grosso, 390 U.S. at 67-68 (“The premises of the [Required
Records Doctrine], as it is described in Shapiro, are evidently
three: first, the purposes of the United States’ inquiry must be
essentially regulatory; second, information is to be obtained
by requiring the preservation of records of a kind which the
regulated party has customarily kept; and third, the records
themselves must have assumed ‘public aspects‘ which render
them at least analogous to public documents. . . . [B]oth the
11244 IN RE GRAND JURY INVESTIGATION M.H.
first and third factors are plainly absent from this case.”
(emphasis added)).
Since Grosso and Marchetti, the Supreme Court has
applied Shapiro and the principles underlying the Required
Records Doctrine broadly to “items that are the legitimate
object of the government’s noncriminal regulatory powers,”
Baltimore City Dept. of Soc. Servs. v. Bouknight, 493 U.S.
549, 557 (1990), regardless of whether they are required to be
kept and regardless of whether they are records. See, e.g.,
California v. Byers, 402 U.S. 424, 427-31 (1971) (applying
Required Records Doctrine principles and concluding that a
state statute requiring drivers involved in vehicle accidents to
stop at the scene of the accident and leave their names and
addresses for police did not infringe the Fifth Amendment);
Bouknight, 493 U.S. at 558 (applying the Required Records
Doctrine to determine that a parent lacked a Fifth Amendment
privilege in producing her child in response to a court’s
order).
[5] We have recognized that the three principles
announced in Grosso define the Required Records Doctrine,
but have also adopted the Supreme Court’s flexibility in
applying those principles. See In re Grand Jury Proceedings
(Doe M.D.), 801 F.2d 1164, 1168 (9th Cir. 1986) (“Under [the
Required Records Doctrine], the Fifth Amendment privilege
does not apply if: (1) the purpose of the government’s inquiry
is regulatory, not criminal; (2) the information requested is
contained in documents of a kind the regulated party custom-
arily keeps; and (3) the records have public aspects.”); see
also U.S. SEC v. Fehn, 97 F.3d 1276, 1291-92 (9th Cir. 1996)
(observing that we have applied the Required Records Doc-
trine “principles in a variety of contexts, and have accorded
them varying emphasis”).
Even though M.H. is being asked to turn over reports he is
required to keep pursuant to the BSA and its regulations, the
Government, citing Byers, Bouknight, and Fehn, suggests that
IN RE GRAND JURY INVESTIGATION M.H. 11245
all three requirements need not be met. While it is true that
when the Required Records Doctrine is applied to items other
than records a rigid application of all three factors may not be
necessary, see, e.g., Bouknight, 493 U.S. at 558-60 (applying
the “principles” of the Required Records Doctrine and con-
cluding that a mother compelled to produce her child through
a court order could not invoke a Fifth Amendment privilege
against self-incrimination to resist the order); United States v.
Des Jardins, 747 F.2d 499, 507-09 (9th Cir. 1984) (conclud-
ing that the Fifth Amendment privilege does not apply to a
requirement under the BSA that travelers transferring more
than $5,000 out of the country file a written report, but con-
sidering only whether the regulation at issue was essentially
regulatory or criminal in nature), rev’d on other grounds, 772
F.2d 578 (9th Cir. 1985), we need not resolve that issue here.
Even if we assume, for purposes of decision, that all three
prongs of the test set forth in Grosso apply, we conclude that
all three requirements are met in this case.
1. “Essentially regulatory”
We begin by recognizing that when compelled disclosure
has incriminating potential, “the judicial scrutiny is invariably
a close one.” Byers, 402 U.S. at 427. In evaluating the danger
of incrimination, we consider whether the requirement in
question is essentially regulatory or criminal in nature. Doe
M.D., 801 F.2d at 1168. In doing so, “[i]t is irrelevant that
records kept for regulatory purposes may be useful to a crimi-
nal grand jury investigation.” Id. Instead, we consider whether
the statutory or regulatory requirement involves an area “per-
meated with criminal statutes,” whether it is “aimed at a
highly selective group inherently suspect of criminal activi-
ties,” Des Jardins, 747 F.2d at 508 (internal citations and quo-
tation marks omitted), and whether complying with the
requirement would “generally . . . prove a significant ‘link in
a chain’ of evidence tending to establish guilt.” Id. at 509
(internal quotation marks omitted). M.H. argues that, for sev-
11246 IN RE GRAND JURY INVESTIGATION M.H.
eral reasons, the BSA’s record-keeping provision is criminal
in nature, not regulatory. Our precedent indicates otherwise.
[6] M.H. first argues that § 1010.420 is criminal in nature
because the BSA’s “primary purpose is to detect criminal
conduct, specifically money laundering, terrorism and tax
evasion.” To support this position, M.H. points to language in
the BSA describing the purpose of the statute as requiring
“certain reports or records, where they have a high degree of
usefulness in criminal, tax, or regulatory investigations or pro-
ceedings, or in the conduct of intelligence or counterintelli-
gence activities, including analysis, to protect against
international terrorism.” See 31 U.S.C. § 5311. M.H. also
cites language from the IRS Web site describing the BSA as
the first law to fight money laundering in the United States,
along with legislative history indicating congressional interest
in combating criminal activity.
[7] The Supreme Court has already considered and
rejected these arguments as they relate to the BSA generally.
In California Bankers Ass’n v. Shultz, 416 U.S. 21, 76-77
(1974), the Court observed that the goal of assisting in the
enforcement of criminal laws “was undoubtedly prominent in
the minds of the legislators,” as they considered the BSA.
However, it noted that “Congress seems to have been equally
concerned with civil liability which might go undetected by
reason of transactions of the type required to be recorded or
reported.” Id. at 76. The Court concluded that “the fact that
a legislative enactment manifests a concern for the enforce-
ment of the criminal law does not cast any generalized pall of
constitutional suspicion over it.” Id. at 77. Therefore, that
Congress aimed to use the BSA as a tool to combat certain
criminal activity is insufficient to render the BSA essentially
criminal as opposed to essentially regulatory.
Turning to the specific regulation in question, our analysis
in Des Jardins is informative. There, we considered whether
a particular BSA record-reporting provision, which required
IN RE GRAND JURY INVESTIGATION M.H. 11247
travelers to report transporting more than $5,000 in monetary
instruments across the United States border, was essentially
criminal in nature and determined it was not. In that case, a
U.S. Customs Agent working at the Los Angeles International
Airport—as part of a project to detect narcotics-related crimi-
nal activity—noticed that Des Jardins’s travel route paralleled
those drug couriers frequently took. Des Jardins, 747 F.2d at
501. The agent inspected Des Jardins’s luggage and found
$5,000. Upon searching Des Jardins’s person, the agent dis-
covered several thousand more dollars. Id. at 502. Des Jardins
was ultimately convicted for violating the reporting require-
ment.
We considered whether the reporting requirement violated
Des Jardins’s Fifth Amendment privilege, and we analyzed
whether the fact that the regulation was not “exclusively regu-
latory” made it essentially criminal. Id. at 508-09 (emphasis
added). We determined it did not. Id. at 509. We reasoned in
part that “[s]ince the transportation of monetary instruments
in such amounts is not itself illegal and since there is no rea-
son to suppose that the transportation of monetary instruments
in such amounts is generally connected with criminal activity,
the vast majority of people subject to the requirement are not
suspect of illegality.” Id.
[8] The same can be said here. There is nothing inherently
illegal about having or being a beneficiary of an offshore for-
eign banking account. According to the Government,
§ 1010.420 applies to “hundreds of thousands of foreign bank
accounts—over half a million in 2009.” Nothing about having
a foreign bank account on its own suggests a person is
engaged in illegal activity. That fact distinguishes this case
from Marchetti and Grosso, where the activity being
regulated—gambling—was almost universally illegal, so that
paying a tax on gambling wagers necessarily implicated a per-
son in criminal activity. Admitting to having a foreign bank
account carries no such risk. That the information contained
in the required record may ultimately lead to criminal charges
11248 IN RE GRAND JURY INVESTIGATION M.H.
does not convert an essentially regulatory regulation into a
criminal one. See Des Jardins, 747 F.2d at 508; see also Mar-
chetti, 390 U.S. at 57.
Considering whether the sought-after information would
likely serve as a significant chain in a link of evidence estab-
lishing guilt, we found relevant in Des Jardins the nature of
the specific information travelers were required to report (the
legal capacity in which the person filing the report was acting;
the origin, destination, and route being traveled; and the
amount and kind of monetary instruments transported). We
concluded that because such evidence lacked an inherently
criminal quality, it would not likely serve as a significant link
in a chain of evidence. Des Jardins, 747 F.2d at 508-09.
[9] M.H. was required to maintain, and through the sub-
poena is being asked to produce, the following information:
(1) The name in which each account is maintained;
(2) The number or other designation of such account;
(3) The name and address of the foreign bank or
other person with whom such account is maintained;
(4) The type of such account;
(5) The maximum value of each such account during
the reporting period.
[10] This information is not inherently criminal. As in Des
Jardins, it is the act of not reporting (or in this case the act
of not maintaining for inspection) the information that sug-
gests criminality, not the information itself. Because the infor-
mation being requested of M.H. is not inherently criminal,
being required to provide that information would generally
not establish a significant link in a chain of evidence tending
to prove guilt. See Des Jardins, 747 F.2d at 509 (“Since the
IN RE GRAND JURY INVESTIGATION M.H. 11249
requirement concerns such relatively innocuous matters . . .
any information obtained would be at best tangentially related
to criminal activity.”); see also Wilson, 221 U.S. at 380 (“But
the physical custody of incriminating documents does not of
itself protect the custodian against their compulsory produc-
tion. The question still remains with respect to the nature of
the documents and the capacity in which they are held.”).
[11] M.H. suggests that Des Jardins should not apply
because in that case we considered a reporting requirement
instead of a record-keeping requirement. But Des Jardins’s
analysis of whether the regulation in question was essentially
regulatory did not hinge on the “reporting” aspect of the regu-
lation. Des Jardins relied on cases interpreting the Required
Records Doctrine and is clearly applicable to the “essentially
regulatory” aspect of that doctrine, which does not turn on
whether a reporting requirement exists, but—as we have
already explained—on whether the information sought is
inherently criminal in nature. While Des Jardins does not
answer the precise question at issue in this case, we apply the
rules recognized there to inform our Fifth Amendment
inquiry. Those rules suggest that because § 1010.420 does not
target inherently illegal activity or a highly selective group of
people inherently suspect of criminal activity, it is essentially
regulatory, not criminal.
We have held that whether a requirement to maintain
records involves a reporting requirement is not determinative
for purposes of deciding whether it is essentially regulatory.
See United States v. Rosenburg, 515 F.2d 190, 199-200 (9th
Cir. 1975) (holding that the Required Records Doctrine
applied even though the statute in question only required
records to be kept for two years and did “not expressly pro-
vide that records shall be open to inspection by state offi-
cials”). Thus, the lack of an “automatic” reporting
requirement does not mean § 1010.420 is not essentially regu-
latory. This conclusion makes sense because, as we have
already explained, the heart of the “essentially regulatory”
11250 IN RE GRAND JURY INVESTIGATION M.H.
inquiry is whether the regulation in question targets inherently
illegal activity. As we observed in Rosenburg, where the pur-
pose of the record-keeping requirement “is to aid in the
enforcement of” the statutory scheme, the Required Records
Doctrine may apply, regardless of whether the regulation
itself includes a reporting requirement, automatic or other-
wise. Id. at 200.
Moreover, § 1010.420 has a reporting requirement. The
regulation mandates that the required records “shall be kept at
all times available for inspection as authorized by law.” The
Supreme Court has indicated that no meaningful difference
exists “between an obligation to maintain records for inspec-
tion, and such an obligation supplemented by a requirement
that those records be filed periodically with officers of the
United States.” Marchetti, 390 U.S. at 56 n.14.
Because § 1010.420 is essentially regulatory in nature, we
conclude that the first prong of the Required Records Doc-
trine is satisfied.
2. Customarily Kept
[12] We have not assigned a specific definition to the term
“customarily kept,” but records appear to be customarily kept
if they would typically be kept in connection with the regu-
lated activity. As the case law dealing with this requirement
suggests, the Fifth Amendment does not apply when the Gov-
ernment compels individuals to create records that they would
customarily keep.
In Shapiro, the records a fruit wholesaler “customarily
kept” in compliance with the Emergency Price Control Act of
1942 were not privileged. By contrast, in Marchetti, records
regarding a person’s gambling expenses were deemed not
customarily kept and were privileged. Some courts have rec-
ognized records as “customarily kept” where they are required
to be retained as part of the general regulatory scheme, as they
IN RE GRAND JURY INVESTIGATION M.H. 11251
were in Shapiro. See, e.g., In re Doe, 711 F.2d 1187, 1191 (2d
Cir. 1983) (“That the W-2s are records of a kind customarily
kept by taxpayers is not open to dispute.”). Most, however,
seem to simply make a cursory statement that the records are,
or are not, customarily kept. See, e.g., Doe M.D., 801 F.2d at
1168 (concluding without analysis that “it is evident that Doe
customarily maintained the documents in his possession”).
[13] The information that § 1010.420 requires to be kept is
basic account information that bank customers would custom-
arily keep, in part because they must report it to the IRS every
year as part of the IRS’s regulation of offshore banking, and
in part because they need the information to access their for-
eign bank accounts. That M.H.’s bank keeps the records on
his behalf does not mean he lacks access to them or that they
are records offshore banking customers would not customar-
ily keep. A bank account’s beneficiary necessarily has access
to such essential information as the bank’s name, the maxi-
mum amount held in the account each year, and the account
number. Both common sense and the records reviewed in
camera support this assessment. We conclude that the records
sought are customarily kept.
3. “Public aspects”
[14] The Supreme Court has recognized that if the govern-
ment’s purpose in imposing the regulatory scheme is essen-
tially regulatory, then it necessarily has some “public
aspects.” Shapiro, 335 U.S. at 33 (noting that “the privilege
which exists as to private papers cannot be maintained in rela-
tion to records required by law to be kept in order that there
may be suitable information of transactions which are the
appropriate subjects of governmental regulation, and the
enforcement of restrictions validly established” (citation and
internal quotation marks omitted)); id. at 34 (observing that
because the Price Control Act required the records in question
to be kept, they had “public aspects”).
11252 IN RE GRAND JURY INVESTIGATION M.H.
[15] The mere fact that the government has “formalized its
demands in the attire of a statute” does not automatically
ascribe “public aspects” to otherwise private documents. See
Marchetti, 390 U.S. at 57. However, that the information
sought is traditionally private and personal as opposed to
business-related does not automatically implicate the Fifth
Amendment. Where personal information is compelled in fur-
therance of a valid regulatory scheme, as is the case here, that
information assumes a public aspect. See Byers, 402 U.S. at
431-32 (holding that a California statutory requirement that
drivers involved in automobile accidents provide their names
and addresses to police did not infringe on the Fifth Amend-
ment privilege because “[d]isclosure of name and address is
an essentially neutral act. Whatever the collateral conse-
quences of disclosing name and address, the statutory purpose
is to implement the state police power to regulate use of
motor vehicles”). Similarly, disclosure of basic account infor-
mation is an “essentially neutral” act necessary for effective
regulation of offshore banking.
M.H. argues that the records in question, even if they are
essentially regulatory, lack public aspects because “nothing in
the record keeping provision of the BSA requires [M.H.] to
produce bank records to the Government.” However, we have
held that a regulation need not have an express reporting
requirement in order to have public aspects. See Rosenberg,
515 F.2d at 199-200 (finding no Fifth Amendment violation
even though the statute required records to be kept but not
produced (citing Shapiro, 335 U.S. 1, and Grosso, 390 U.S.
at 68)).
Furthermore, as we have already noted, § 1010.420 does
require M.H. to produce to the Government the information
being sought upon request, as long as that request is autho-
rized by law. The regulation states that records “shall be
retained for a period of 5 years and shall be kept at all times
available for inspection as authorized by law.” § 1010.420.
Additionally, the information required to be kept under
IN RE GRAND JURY INVESTIGATION M.H. 11253
§ 1010.420 is the same information disclosed in FBAR forms.
For purposes of the Required Records Doctrine, it does not
matter whether the production of that information is requested
through a subpoena (as in this case and Shapiro), a court order
(as in Bouknight), or the regulation itself (as in Byers). See
Marchetti, 390 U.S. at 56 n.14 (rejecting the argument that
“the crucial issue respecting the applicability of Shapiro is the
method by which information reaches the Government”).
Even if § 1010.420 lacked any reporting requirement whatso-
ever, it would still have public aspects because, as was the
case in Rosenberg, the documents in question are required to
be kept to aid in the enforcement of a valid regulatory
scheme.
M.H. next suggests that because the BSA provides that a
person need only disclose records “as required by law” and
the House report accompanying the legislation specified that
the records “will not be made automatically available for law
enforcement purposes,” the records are not public because
they are not “easily accessed” by the Government. But court
orders and subpoenas are legal processes that prevent law
enforcement from automatically retrieving information, and
whether a document is easily accessible has nothing to do
with whether a document has public aspects. See Marchetti,
390 U.S. at 56 n.14; see also Rosenberg, 515 F.2d at 199-200.
The language “as required by law” does not prevent the
sought-after records from assuming public aspects for pur-
poses of the Required Records Doctrine.
M.H.’s argument that, because the law recognizes special
privacy interests in bank records and tax documents, those
documents cannot have “public aspects” is also flawed. The
fact that documents have privacy protections elsewhere does
not transform those documents into private documents for the
purpose of grand jury proceedings. See Doe M.D., 801 F.2d
at 1168 (finding that confidential patient records have “public
aspects” for purposes of the Required Records Doctrine and
that “expectations of privacy do not negate a finding that there
11254 IN RE GRAND JURY INVESTIGATION M.H.
is a public aspect to the files under the . . . regulatory
schemes”); see also Fisher, 425 U.S. at 401 (“We adhere to
the view that the Fifth Amendment protects against ‘com-
pelled self-incrimination, not the disclosure of private infor-
mation.’ ” (citation and internal markings omitted)).
M.H. emphasizes decisions from other circuits that have
found certain personal income tax documents beyond the
scope of the Required Records Doctrine. Those cases are not
binding in this Circuit, but even if they were, they fail to sup-
port M.H.’s position. For example, M.H. relies heavily on
Smith v. Richert, 35 F.3d 300, 303 (7th Cir. 1994). There, the
court held that where the “production of personal tax records
of the character of W-2’s and 1099’s would have testimonial
force and incriminate the taxpayer . . . the required-records
doctrine is inapplicable and that production is excused by the
self-incrimination clause.” Smith, 35 F.3d at 304.
But the rationale behind that ruling was that “[t]he decision
to become a taxpayer cannot be thought voluntary . . .
[because] [a]lmost anyone who works is a taxpayer, along
with many who do not.” Id. at 303. The court reasoned that
the obligatory nature of paying taxes was distinguishable from
“the case of the individual who enters upon a regulated activ-
ity knowing that the maintenance of extensive records avail-
able for inspection by the regulatory agency is one of the
conditions of engaging in the activity.” Id. In the latter
scenario—which is precisely the situation here because no
one is required to participate in the activity of offshore
banking—the required records doctrine would apply.
Furthermore, in Smith the subpoena did not indicate that the
records being sought related to a regulated activity, whereas
in this case the subpoena so indicates. See id. (determining
that the Required Records Doctrine did not apply in part
because “[n]othing in the subpoena identifies the records
sought as records required by the state’s agricultural statutes
to be kept”). Here, the subpoena explicitly requires the pro-
IN RE GRAND JURY INVESTIGATION M.H. 11255
duction of banking records required to be kept and maintained
for inspection pursuant to regulations implemented through
the BSA.
[16] Finally, M.H. argues that allowing the regulatory
nature of a requirement to render it as having “public aspects”
allows the exception to swallow the rule that “[t]he Govern-
ment’s anxiety to obtain information known to a private indi-
vidual does not without more render that information public.”
Marchetti, 390 U.S. at 57. But, as stated above, a statute or
regulation “directed at a selective group inherently suspect of
criminal activities” fails to render the privilege against self-
incrimination inapplicable. Id. Determining whether a regula-
tion is essentially regulatory or criminal requires analysis that
goes beyond the label Congress or an agency provides, thus
safeguarding against the exception swallowing the rule. Fur-
thermore, in this instance, M.H. has not made a compelling
argument that the information he is being asked to provide
lacks “public aspects” despite its essentially regulatory nature.
We therefore conclude that the records in question have pub-
lic aspects.
IV
[17] Because the records sought through the subpoena fall
under the Required Records Doctrine, the Fifth Amendment
privilege against self-incrimination is inapplicable, and M.H.
may not invoke it to resist compliance with the subpoena’s
command. See Doe M.D., 801 F.2d at 1167 (“Records that are
required to be maintained by law are outside the scope of the
privilege [against self-incrimination].”). Because M.H.’s Fifth
Amendment privilege is not implicated, we need not address
his request for immunity. Bouknight, 493 U.S. at 562 (declin-
ing to “define the precise limitations that may exist upon the
State’s ability to use the testimonial aspects of Bouknight’s
act of production in subsequent criminal proceedings”).
The district court’s order is AFFIRMED.