Foreign Bank Account Report (FBAR) requirements are a key element of U.S. anti-money laundering law. All U.S. persons with foreign accounts exceeding $10,000 at any point during the year must file an FBAR. While many infractions result in civil penalties, criminal charges can arise when violations are deemed “willful”- that is, when someone intentionally ignores FBAR filing obligations.

Understanding Foreign Bank Account Reporting

The statutes governing FBAR, 31 USC 5321-5322, make it a crime to willfully fail to file an FBAR. Prosecutors look for evidence that an individual knew about their duty to report foreign accounts and deliberately chose not to comply. “Willfulness” may be established by direct proof or by showing a “reckless disregard” for the law, including hiding accounts, misleading tax advisors, or taking steps to actively avoid detection.

Penalties for Violating Foreign Bank Account Reporting

Criminal FBAR violations are serious. A person found guilty of willfully failing to file faces up to $250,000 in fines and five years in prison for each violation. If the failure is part of a broader illegal scheme or involves more than $100,000 in a year, penalties can climb to $500,000 in fines and ten years' imprisonment. The government can also seek asset forfeiture or additional penalties under money laundering statutes.

Defending Against FBAR Accusations

If you are accused of a willful FBAR violation, the Sigal Law Group attorneys will employ rigorous defense strategies on your behalf, including:

• Challenging the government's evidence of “willfulness,” often showing there was a misunderstanding or good-faith compliance efforts.
• Assessing whether the client actually had a legal duty to report the accounts.
• Leveraging procedural errors, negotiating resolutions, and advocating for penalty mitigation or dismissal, aiming to avoid criminal prosecution whenever possible.

Moreover, the Sigal Law Group offers experienced, aggressive defense for clients facing federal money laundering or FBAR-related criminal charges. Contact our offices today for a free consultation.