 Former federal prosecutor Katie Haun reminds us of one of our “favorite” topics – the ill-conceived Bank Secrecy Act (BSA) of 1970, which has brought us to this sorry point of a near-lack of privacy in our financial dealings. She writes: “Most Americans don’t realize they live under an expansive surveillance regime that likely violates their constitutional rights. Every purchase, deposit, and transaction, from the smallest Venmo payment for a coffee to a large hospital bill, creates a data point in a system that watches you – even if you’ve done nothing wrong.” The U.S. Supreme Court’s disastrous 1976 ruling in United States v. Miller upheld the BSA and further declared that Americans had “no legitimate expectation of privacy” in checking and deposits. From that point on, Haun laments, it was open season on Americans’ data, but especially our financial information. The BSA turned banks into spies and its reporting requirements have been weaponized into instruments of political repression. And little wonder, in the digital era and post-9/11, the original act was amended to the point of readily enabling the creation of a mass surveillance state and its attendant bureaucracy. Under the BSA, notes Haun, law enforcement doesn’t need a search warrant to access our financial records: “A prosecutor can ‘cut a subpoena’ – demanding all your bank records for the past 10 years – with no judicial oversight or limitation on scope … In contrast, a proper search warrant must be narrowly tailored, with probable cause and judicial authorization.” That last bit is a reference to the basic American right against unlawful search and seizure as guaranteed by the Fourth Amendment. But ever since the Bank Secrecy Act laid the foundation and the Supreme Court put up the walls, true financial privacy is a right Americans no longer possess. And without reforming the BSA, warns Haun, we may never get it back: “Indiscriminate financial surveillance such as what we have today is fundamentally at odds with the Fourth Amendment in the digital age. Technological innovations over the past several decades have brought incredible convenience to economic life. Now our privacy standards must catch up. With Congress considering landmark legislation on digital assets, it’s an important moment to consider what kind of financial system we want – not just in terms of efficiency and access, but in terms of freedom. Rather than striking down the BSA in its entirety, policymakers should narrow its reach, particularly around the bulk collection and warrantless sharing of Americans’ financial data. Financial surveillance shouldn’t be the price of participation in modern life.” We couldn’t agree more. And we hope that savvy BSA reform legislation proposed this session will find fertile ground in Congress among Republicans and Democrats alike. Unfortunately, in the meantime, the Fourth Amendment remains for sale. For further reading, check out this piece from the Pacific Legal Foundation. Comments are closed.
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