The Bank Privacy Reform Act would overhaul both the Bank Secrecy Act (BSA) framework and the Right to Financial Privacy Act of 1978. The bill would sharply restrict how the government can access a person’s financial records by requiring access only through search warrants (with limited exceptions) and by removing many of the current disclosure and civil remedies provisions. At the same time, it would repeal or restructure large portions of the BSA’s reporting regime, effectively rolling back extensive AML/CTF (anti-money-laundering/financing of terrorism) requirements. It also introduces a new purpose for financial institutions to retain transaction information tied to individual customers and would index the threshold for certain reporting (like currency transaction reports) to the Consumer Price Index, potentially reducing the frequency of some reports. In short, the bill expands privacy protections by hardening access standards, while simultaneously scaling back many BSA reporting requirements and imposing a broad data-retention obligation on banks.
Key Points
- 1Right to Financial Privacy Act overhaul: Government access to financial records would be limited to disclosures in response to a search warrant that meets specific requirements, with major provisions and civil remedies removed or replaced (sections 1104, 1105, 1107, 1108, 1114 eliminated; access narrowed to warrant-based process).
- 2Massive BSA overhaul: The bill repeals or removes a large set of BSA reporting and enforcement provisions (sections 5313, 5314, 5315, 5316, 5317, 5318A, 5324, 5326, 5331, 5332, 5336 and subchapter III), effectively shrinking or removing many traditional AML/CTF requirements.
- 3New data-retention mandate: Section 5311 is amended to declare the purpose of requiring financial institutions to retain transaction records that include information identifiable as derived from a customer’s financial records. This creates a broad retention obligation for bank data.
- 4Redefined coverage and thresholds: The bill redefines certain terms (e.g., “nonfinancial trade or business”) and revises coverage and reporting constructs. It also indexes the currency transaction reporting (CTR) threshold to the Consumer Price Index, which could raise the amount before a CTR is required.
- 5Narrowed regulatory structure: By striking and reorganizing numerous sections, the bill would significantly reduce the existing, intricate network of BSA compliance rules, examinations, and special measures, potentially shifting how banks collect, retain, and report customer information.