Financial Surveillance Is Expanding Before Our Eyes

Nicholas Anthony

Financial surveillance is getting worse every day. Although many legislative expansions have not passed, the wheel keeps turning. Inflation, geographic targeting orders (GTOs), and executive orders have greatly expanded the Bank Secrecy Act.

Inflationary Surveillance

Most Americans have felt the pain of inflation in recent years. However, what they don’t often see is that inflation also erodes financial privacy. The Financial Crimes Enforcement Network (FinCEN) adjusts its penalties for inflation, but it does not adjust reporting thresholds. In the most egregious case, the $10,000 reporting threshold now used for currency transaction reports (CTRs) has not been changed since the number was first established in 1945 by an executive order. That’s equal to around $180,000 today (Figure 1). When the Bank Secrecy Act was ultimately passed in 1970, you could buy two new Corvettes for $10,000. Today, you could spend all of that on just the engine.

In practice, that means the Bank Secrecy Act regime is swallowing up more transactions every year as inflation decreases the value of the dollar. No bills are passed; no regulations are open to the public. Yet, the wheel is turning, and financial surveillance increases without any checks or balances.

When the Supreme Court effectively signed off on the Bank Secrecy Act, it only did so because $10,000 was considered “abnormally large” in the 1970s. However, Supreme Court Justices Lewis Powell and Harry Blackmun warned that “A significant extension of the regulations’ reporting requirements … would pose substantial and difficult constitutional questions for [us.] At some point, governmental intrusion upon these areas would implicate legitimate expectations of privacy.”

We have hit that point. In fact, that point was crossed a long time ago. Recognizing what has happened, Representatives Joyce Beatty (D‑OH), Barry Loudermilk (R‑GA), French Hill (R‑AR), Bryan Steil (R‑WI), and Roger Williams (R‑TX) all pointed out the need for change during a 2022 oversight hearing. Yet, FinCEN has been silent.

Targeting the Border

Beyond inflation, FinCEN has dramatically expanded financial surveillance at the southern border through geographic targeting orders by lowering the $10,000 threshold to just $200. One small business estimated that it would likely go from filing nine reports per week to filing 50,000 reports per week under the initial order. That is nothing short of an impossible standard to comply with. In effect, both entrepreneurs and customers will suffer, likely pushing more people into illegal markets. 

Reflecting on the geographic targeting orders, a Texas court described the $200 surveillance order as “unreasonable” because it “overreaches,” “defies common sense,” and “likely violates the Fourth Amendment.” “It appears the Government did not think,” wrote the court. The “tactic employed here is akin to using a blunderbuss to target a fly.”

The court issued an injunction to put the geographic targeting order on ice until each side could make its case. A similar injunction was issued in California. This news was welcome until FinCEN went around the courts and reissued the order at a higher threshold and over a vastly greater area—affecting 3.2 million people living across 126 zip codes in Arizona, California, and Texas.

FinCEN Director Andrea Gacki said, “The reports generated by this Geographic Targeting Order will continue to help law enforcement investigate powerful illicit networks operating along the southwest border and beyond.” Yet strangely, when Director Gacki appeared before Congress just a few days later, she was unable to say how many criminals were caught because of this surveillance regime.

Trump’s Latest Executive Order

Were these expansions not enough, President Donald Trump has also called for the Bank Secrecy Act to be expanded under executive orders. 

Most recently, President Trump issued an executive order that said banks need to start acting as immigration agents and report people they suspect of being in the country illegally. This reporting would be done through suspicious activity reports (SARs). In doing so, President Trump also created another new avenue for debanking by instructing the Consumer Financial Protection Bureau (CFPB) to warn all banks that undocumented immigrants pose a credit risk because of their “potential deportation.” In other words, he said that anyone suspected of being undocumented should be debanked. 

President Trump made a similar move in 2025 when he designated Antifa as a domestic terrorist organization. The White House then published a memo outlining how the Bank Secrecy Act should be used to “identify and disrupt financial networks that fund” Antifa to “ensure such activity is rooted out at the source.”

People have certainly done wrong under the Antifa banner, but this designation poses a problem because Antifa is not a formal group with official members. Instead, it’s more akin to a political ideology. With that in mind, it is unclear how banks are supposed to avoid Antifa. Should banks blacklist anyone who comes in wearing an Antifa pin? Should they review photos of protests to identify potential Antifa-aligned customers? Should onboarding documents include a questionnaire about a customer’s feelings about fascism? In any event, this executive order will likely result in more people being debanked.

Conclusion

Contrary to concerns, restoring financial privacy will not stop law enforcement from investigating and prosecuting crimes. Rather, it would just make the process outlined in the Constitution the official standard. Congress has multiple options to restore financial privacy. Indexing reporting thresholds to inflation, strengthening the Right to Financial Privacy Act, and ending the Bank Secrecy Act are all things within Congress’s power. However, until they act, financial surveillance will continue to get worse every day. 

Source: https://www.cato.org/blog/financial-surveillance-expanding-our-eyes