Increased spy access to Americans' banking data raises privacy concerns

Spy agencies like the CIA and NSA would have access to a database used to fight domestic financial crime under a proposal being drafted by the Obama Administration.

The database, among other things, catalogs bank deposits of $10,000 or more made by American citizens and anyone else doing business with a U.S. bank.

Details of the plan were detailed Thursday by Reuters, which obtained a copy of the planning document dated March 4.

The proposed move is another example of wrong-headed thinking by government agencies in the post-9/11 era, said J . Bradley Jansen, director of the Center for Financial Privacy and Human Rights (CFPHR) in Washington, D.C. "There was a great hysteria after 9/11 and law enforcement was given this blank check on information," he said in an interview. "Law enforcement thinks that more information equals better intelligence. That's just not true."

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Opening up the federal database, known as the Financial Crimes Enforcement Network (FinCEN), to more government eyes would be a mistake, he said.

"We're inviting all kinds of abuses that had been stopped, usually, in the past," he said. Allowing data mining by federal agencies as part of anti-terrorist efforts has come under repeated criticism in the past as being unreliable.

According to the U.S. Treasury and FinCEN, there are no initiatives under way or contemplated to expand access by the intelligence community to the FinCEN database.

"All that is being explored -- and nothing has been decided yet -- is how we can best ensure that our government is in position to combat terrorist activity -- and of course, all the protections in law, including the limitations on the [intelligence community's] access to information on Americans, will be preserved," a Treasury spokesperson said via email.

He noted that in its efforts to combat international terrorism, the intelligence community already has the ability -- subject to rigorous protections -- to conduct case-by-case searches in FinCEN's data. "There is no plan to change that, and certainly no plan to allow the [intelligence community] to engage in data-mining in FinCEN's data," he said.

The plan being reviewed by Treasury, would allow spy agencies to peek at more raw data in the FinCEN database and mine that data for patterns that could be connected to terrorist or criminal activity.

The FBI already has full access to the database, but intelligence agencies can access data only on a case-by-case basis, Reuters reported.

FinCEN is allowed to share its data with other government agencies, an agency spokesman said in an emailed statement. Anyone accessing information gathered under the Bank Security Act (BSA) is subject to restrictions already in federal law.

If the information sought has to do with American citizens, even tougher restrictions must be met, he added.

Under federal law, financial institutions that do business in the United States must report to FinCEN cash deposits of $10,000 or more, as well as "suspicious customer activity" -- large money transfers or unusually structured bank accounts.

Financial institutions file some 15 million reports on "suspicious" activity each year.

"Most of the [Currency Transaction Reports] are retailers taking in cash at their registers and making cash deposits," Jansen said.

Information in the Suspicious Activity Reports has also degraded over time, he continued, as banks have been pressured to expand what is considered "suspicious."

"It's no longer, 'al Queda's in my bank depositing money it's going to use to blow up a building,'" he said. "It's 'someone walked in and they didn't tie their shoelace.'"

Read more about malware/cybercrime in CSOonline's Malware/Cybercrime section.

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