What does it mean to “willfully” violate the Bank Secrecy Act?  

The Bank Secrecy Act (BSA) provides criminal and civil penalties for willful violations. The standard for willfulness changes depending on whether criminal or civil penalties are at issue.

In criminal cases, willfulness is a high standard. The government must prove the defendant acted with knowledge that the conduct at issue violated the law. Generally, ignorance of the law is not a defense. To prove willful conduct, however, the government must show that defendants knew the legal requirements they allegedly violated. That means that criminal penalties under the BSA are available only when the financial institutions and people involved know of their obligations to maintain effective antimony laundering programs and file required reports.

For civil penalties, the bar is lower. The Supreme Court has held that reckless conduct satisfies the willfulness standard in civil cases. To prove recklessness, the government must show the defendants acted with knowledge of an unjustifiably high risk of harm. Thus, in civil cases, defendants need not know that their actions violate the law, but instead only that they create an unjustifiable risk. In prior cases, the government has offered evidence that financial institutions or their employees received warnings about potential dangers. Such warning can come from different sources, ranging from other employees to outside consultants or government officials.

A higher willfulness standard applies in criminal cases because criminally willful violations can be punished by imprisonment. The fines for criminal violations are generally also higher than for civil infractions.

To learn more about the Bank Secrecy Act and other whistleblower programs, go to www.mololamken.com and follow us on LinkedIn. “Brilliant lawyers with courtroom savvy” — Benchmark Litigation. Copyright MoloLamken LLP 2025.