Five Agencies Have Told Banks They Can Explain a Frozen or Closed Account. What They Cannot Say Is That a Report Exists.

Anyone who has had a bank account frozen or closed with no explanation has run into the edge of a rule most customers never hear named. Under the Bank Secrecy Act, a financial institution that files a suspicious activity report may not disclose that the report exists. Banks, uncertain how far that silence extends, have often extended it to everything.

On September 2 the Federal Reserve, the FDIC, the National Credit Union Administration, the Office of the Comptroller of the Currency and FinCEN issued a joint statement narrowing that uncertainty. The Federal Reserve transmitted it as Supervisory Letter SR 26-5; the OCC as Bulletin 2026-43.

The line the statement draws

The confidential thing is the report. The statement says an institution may communicate with a customer about potentially fraudulent or otherwise suspicious transactions, and about restricting or closing the account, so long as that communication does not reveal the existence of a SAR.

The distinction the agencies make is between the filing and the facts. Information about the underlying transactions - dates, amounts, the parties involved - is not protected by the confidentiality provision and may be discussed. It is the fact of the report, and anything that would give it away, that must stay unsaid.

What the agencies say is permitted

• Requesting documentation from a customer for due diligence purposes
• Telling a customer that an account is delayed, restricted or being closed
• Rejecting a deposit suspected of being fraudulent
• Asking a customer about the purpose of a transaction
• Giving customers fraud education and warnings
• Requesting originator or beneficiary information on a transfer

What remains prohibited is disclosing a SAR, or information that would reveal one exists, to a customer or a third party. The stated purpose of that prohibition is to keep a person under investigation from learning they are under investigation.

The citations

The prohibition sits at 31 U.S.C. 5318(g)(2)(A), implemented by FinCEN at 31 C.F.R. 1020.320(e). Each banking agency has its own parallel provision: 12 C.F.R. 208.62(j) for the Federal Reserve, Part 353 for the FDIC, 748.1(d) for the NCUA, and 21.11(k) and 163.180(d) for the OCC.

None of those changes. The statement says in terms that it does not alter existing BSA legal or regulatory requirements or establish new supervisory expectations. It is a clarification of what the existing rule already permits.

Where it came from

The agencies trace the statement to comments received on a June 2025 request for information on payments fraud, in which the industry asked how to reconcile SAR confidentiality with the transparency customers expect during a fraud investigation. The statement also references Executive Order 14331 on fair banking access, the policy thread that has run through this year's debate about accounts being closed without explanation.

What it means for a customer

If an account is restricted or closed, the bank is now told plainly by its regulators that it may discuss the transactions that prompted the action. It still may not say whether it filed a report. A customer who receives a factual explanation of which transactions caused a problem, and no answer at all to whether anything was reported, is getting exactly what this statement contemplates.