Unreported foreign accounts are one of the places where a civil compliance problem and a criminal one sit right next to each other. Which side you are on depends on willfulness.
Two very different paths
The IRS treats non-willful mistakes and willful concealment differently. Taxpayers whose conduct was not willful may have options like the streamlined filing compliance procedures. Taxpayers whose conduct was willful face a different calculation, and the IRS points them toward the Voluntary Disclosure Practice.
In a voluntary disclosure, FBAR violations are treated as willful
The IRS civil framework for voluntary disclosures, in IRM 4.63.3.18.2, says FBAR violations in those cases are treated as willful and penalized under the IRS FBAR penalty guidelines. Choosing a path is a legal decision with criminal consequences either way.
Privilege matters here
If there is any chance your conduct was willful, have the analysis done under the attorney-client privilege before anything is filed.
General information only, not legal advice. Reading this page does not create an attorney-client relationship. Laws and IRS procedures change; the sources cited were reviewed on the date shown above.