Sponsors (2)
Official title: Amend the Right to Financial Privacy Act of 1978 to preserve the confidentiality of certain records, and for other purposes.
Introduced February 27, 2025 by Mike Lee · Last progress February 27, 2025
The bill significantly strengthens financial privacy and individual remedies while curtailing centralized data collection and some regulatory powers — a trade-off that improves privacy and consumer choice but raises costs for banks, increases litigation risk, and may hinder law enforcement, market surveillance, and certain policy tools such as a Fed retail CBDC.
Broad swathes of Americans (bank customers and ordinary taxpayers) gain stronger statutory protections limiting federal access to their financial records and preventing centralized collection of personally identifiable financial data (includes new warrant-like standards, explicit Fourth Amendment protections, and termination of the CAT).
Bank customers (and the public) get stronger legal remedies and deterrents against unlawful obtainment or disclosure of financial records, including civil damages (minimum statutory damages), attorney's fees, equitable relief, and criminal penalties for knowing violations.
Small sellers, casual sellers, and payment processors face reduced administrative burden because many low-volume/low-dollar third‑party payment transactions (1099‑K) will no longer generate informational returns, simplifying recordkeeping and reducing IRS processing of low-value returns.
Law enforcement, intelligence agencies, and regulators will face higher legal hurdles and narrower access to financial records and centralized data (including elimination of the CAT and limits on agency blocking of crypto tools), which could slow or hinder investigations into fraud, money laundering, terrorism, and other illicit activity.
Banks and payment firms will incur higher compliance, litigation, and liability exposure (retention requirements, per‑violation/per‑day civil penalties, criminal provisions, reimbursements tied to CAT termination and retroactive changes), costs that are likely to be passed on to customers or borne by taxpayers.
Regulators' ability to detect market abuse, reconstruct trading activity, and carry out AML/CFT surveillance will be weakened by removing Bank Secrecy Act authorities and terminating trade-data collection tools, reducing market integrity and investor protections.
Based on analysis of 16 sections of legislative text.
Tightens privacy for financial records (warrant-first), repeals many Bank Secrecy Act authorities, ends the SEC's Consolidated Audit Trail, bans retail Fed CBDC, raises third‑party reporting thresholds, and protects self‑hosted crypto use.
Rewrites federal bank-privacy and reporting laws to sharply restrict government access to customer financial records, strengthen private-rights and criminal penalties for unlawful access or disclosure, and remove several Bank Secrecy Act reporting authorities. It also orders termination of the SEC’s Consolidated Audit Trail, prohibits the Federal Reserve from issuing a retail central bank digital currency (CBDC), limits agency ability to create centralized databases of personally identifiable financial data, raises the de minimis threshold for third‑party payment‑processor tax reporting, and bars federal agencies from stopping individuals from using convertible virtual currency or self‑hosted wallets. The bill affects banks, payment platforms, federal enforcement and regulatory agencies, and individual users of digital currency by (1) narrowing lawful disclosure pathways to primarily warrant-based access, (2) increasing civil and criminal liability for violations, (3) dismantling a centralized securities-trade data repository, (4) forbidding direct Fed retail CBDC issuance, and (5) changing certain tax reporting and crypto‑use prohibitions.