12 U.S.C. § 3404 — Customer authorizations

Page 1536 TITLE 12—BANKS AND BANKING § 3403 Statutory Notes and Related Subsidiaries EFFECTIVE DATE Section effective upon the expiration of 120 days after Nov. 10, 1978, see section 2101 of Pub. L. 95–630, set out as a note under section 375b of this title. § 3403. Confidentiality of financial records (a) Release of records by financial institutions prohibited No financial institution, or officer, employees, or agent of a financial institution, may provide to any Government authority access to or copies of, or the information contained in, the finan- cial records of any customer except in accord- ance with the provisions of this chapter. (b) Release of records upon certification of com- pliance with chapter A financial institution shall not release the fi- nancial records of a customer until the Govern- ment authority seeking such records certifies in writing to the financial institution that it has complied with the applicable provisions of this chapter. (c) Notification to Government authority of exist- ence of relevant information in records Nothing in this chapter shall preclude any fi- nancial institution, or any officer, employee, or agent of a financial institution, from notifying a Government authority that such institution, or officer, employee, or agent has information which may be relevant to a possible violation of any statute or regulation. Such information may include only the name or other identifying information concerning any individual, corpora- tion, or account involved in and the nature of any suspected illegal activity. Such information may be disclosed notwithstanding any constitu- tion, law, or regulation of any State or political subdivision thereof to the contrary. Any finan- cial institution, or officer, employee, or agent thereof, making a disclosure of information pur- suant to this subsection, shall not be liable to the customer under any law or regulation of the United States or any constitution, law, or regu- lation of any State or political subdivision thereof, for such disclosure or for any failure to notify the customer of such disclosure. (d) Release of records as incident to perfection of security interest, proving a claim in bank- ruptcy, collecting a debt, or processing an application with regard to a Government loan, loan guarantee, etc. (1) Nothing in this chapter shall preclude a fi- nancial institution, as an incident to perfecting a security interest, proving a claim in bank- ruptcy, or otherwise collecting on a debt owing either to the financial institution itself or in its role as a fiduciary, from providing copies of any financial record to any court or Government au- thority. (2) Nothing in this chapter shall preclude a fi- nancial institution, as an incident to processing an application for assistance to a customer in the form of a Government loan, loan guaranty, or loan insurance agreement, or as an incident to processing a default on, or administering, a Government guaranteed or insured loan, from initiating contact with an appropriate Govern- ment authority for the purpose of providing any financial record necessary to permit such au- thority to carry out its responsibilities under a loan, loan guaranty, or loan insurance agree- ment. (Pub. L. 95–630, title XI, § 1103, Nov. 10, 1978, 92 Stat. 3698; Pub. L. 99–570, title I, § 1353(a), Oct. 27, 1986, 100 Stat. 3207–21; Pub. L. 100–690, title VI, § 6186(a), Nov. 18, 1988, 102 Stat. 4357.) Editorial Notes AMENDMENTS 1988—Subsec. (c). Pub. L. 100–690 inserted ‘‘, corporation,’’ after ‘‘individual’’. 1986—Subsec. (c). Pub. L. 99–570 inserted provisions that the disclosure of only the name or other identi- fying information concerning any individual or account involved in and the nature of any suspected illegal ac- tivity is permitted notwithstanding any constitution, law, or regulation of any State or political subdivision thereof to the contrary, and any financial institutions, officers, agents, or employees thereof making such dis- closure shall not be liable to the customer under any State constitution or any Federal, State, or local law or regulation for such disclosure or failure to notify the customer thereof. Statutory Notes and Related Subsidiaries EFFECTIVE DATE Section effective upon the expiration of 120 days after Nov. 10, 1978, see section 2101 of Pub. L. 95–630, set out as a note under section 375b of this title. § 3404. Customer authorizations (a) Statement furnished by customer to financial institution and Government authority; con- tents A customer may authorize disclosure under section 3402(1) of this title if he furnishes to the financial institution and to the Government au- thority seeking to obtain such disclosure a signed and dated statement which— (1) authorizes such disclosure for a period not in excess of three months; (2) states that the customer may revoke such authorization at any time before the fi- nancial records are disclosed; (3) identifies the financial records which are authorized to be disclosed; (4) specifies the purposes for which, and the Government authority to which, such records may be disclosed; and (5) states the customer’s rights under this chapter. (b) Authorization as condition of doing business prohibited No such authorization shall be required as a condition of doing business with any financial institution. (c) Right of customer to access to financial insti- tution’s record of disclosures The customer has the right, unless the Gov- ernment authority obtains a court order as pro- vided in section 3409 of this title, to obtain a copy of the record which the financial institu- tion shall keep of all instances in which the cus- tomer’s record is disclosed to a Government au- thority pursuant to this section, including the Page 1537 TITLE 12—BANKS AND BANKING § 3406 identity of the Government authority to which such disclosure is made. (Pub. L. 95–630, title XI, § 1104, Nov. 10, 1978, 92 Stat. 3698; Pub. L. 96–3, Mar. 7, 1979, 93 Stat. 5.) Editorial Notes AMENDMENTS 1979—Subsec. (d). Pub. L. 96–3 struck out subsec. (d) which had directed that all financial institutions promptly notify all of their customers of their rights under this chapter, that the Board of Governors of the Federal Reserve System prepare a statement of cus- tomers’ rights under this chapter, and that the sup- plying of such a statement to their customers by the fi- nancial institutions be deemed compliance with the no- tification requirement. Statutory Notes and Related Subsidiaries EFFECTIVE DATE Section effective upon the expiration of 120 days after Nov. 10, 1978, see section 2101 of Pub. L. 95–630, set out as a note under section 375b of this title. § 3405. Administrative subpena and summons A Government authority may obtain financial records under section 3402(2) of this title pursu- ant to an administrative subpena or summons otherwise authorized by law only if— (1) there is reason to believe that the records sought are relevant to a legitimate law en- forcement inquiry; (2) a copy of the subpena or summons has been served upon the customer or mailed to his last known address on or before the date on which the subpena or summons was served on the financial institution together with the following notice which shall state with reason- able specificity the nature of the law enforce- ment inquiry: ‘‘Records or information concerning your transactions held by the financial institution named in the attached subpena or summons are being sought by this (agency or depart- ment) in accordance with the Right to Finan- cial Privacy Act of 1978 [12 U.S.C. 3401 et seq.] for the following purpose: If you desire that such records or information not be made avail- able, you must: ‘‘1. Fill out the accompanying motion paper and sworn statement or write one of your own, stating that you are the customer whose records are being requested by the Government and either giving the reasons you believe that the records are not relevant to the legitimate law enforcement inquiry stated in this notice or any other legal basis for objecting to the release of the records. ‘‘2. File the motion and statement by mailing or delivering them to the clerk of any one of the following United States dis- trict courts: . ‘‘3. Serve the Government authority re- questing the records by mailing or deliv- ering a copy of your motion and statement to . ‘‘4. Be prepared to come to court and pre- sent your position in further detail. ‘‘5. You do not need to have a lawyer, al- though you may wish to employ one to rep- resent you and protect your rights. If you do not follow the above procedures, upon the expiration of ten days from the date of service or fourteen days from the date of mailing of this notice, the records or informa- tion requested therein will be made available. These records may be transferred to other Government authorities for legitimate law en- forcement inquiries, in which event you will be notified after the transfer.’’; and (3) ten days have expired from the date of service of the notice or fourteen days have ex- pired from the date of mailing the notice to the customer and within such time period the customer has not filed a sworn statement and motion to quash in an appropriate court, or the customer challenge provisions of section 3410 of this title have been complied with. (Pub. L. 95–630, title XI, § 1105, Nov. 10, 1978, 92 Stat. 3699.) Editorial Notes REFERENCES IN TEXT The Right to Financial Privacy Act of 1978, referred to in par. (2), is title XI of Pub. L. 95–630, Nov. 10, 1978, 92 Stat. 3697, which is classified generally to this chap- ter (§ 3401 et seq.). For complete classification of this Act to the Code, see Short Title note set out under sec- tion 3401 of this title and Tables. Statutory Notes and Related Subsidiaries EFFECTIVE DATE Section effective upon the expiration of 120 days after Nov. 10, 1978, see section 2101 of Pub. L. 95–630, set out as a note under section 375b of this title. § 3406. Search warrants (a) Applicability of Federal Rules of Criminal Procedure A Government authority may obtain financial records under section 3402(3) of this title only if it obtains a search warrant pursuant to the Fed- eral Rules of Criminal Procedure. (b) Mailing of copy and notice to customer No later than ninety days after the Govern- ment authority serves the search warrant, it shall mail to the customer’s last known address a copy of the search warrant together with the following notice: ‘‘Records or information concerning your transactions held by the financial institution named in the attached search warrant were ob- tained by this (agency or department) on (date) for the following purpose: . You may have rights under the Right to Financial Privacy Act of 1978 [12 U.S.C. 3401 et seq.].’’. (c) Court-ordered delays in mailing Upon application of the Government author- ity, a court may grant a delay in the mailing of the notice required in subsection (b), which delay shall not exceed one hundred and eighty days following the service of the warrant, if the court makes the findings required in section 3409(a) of this title. If the court so finds, it shall enter an ex parte order granting the requested delay and an order prohibiting the financial in- stitution from disclosing that records have been obtained or that a search warrant for such