Personal Bank Records Are Private, Says Supreme Court

News Release: 
Monday, April 30, 2007

The Washington Supreme Court has ruled unanimously that bank records are private, and that government needs a warrant or a subpoena that can be challenged in court before gaining access to them. The ACLU of Washington filed a friend-of-the-court brief in the case, urging the court to defend the privacy of personal bank records.

The court issued the ruling in the case of State v. Miles, which dealt with a state agency’s request for the private bank records of a person suspected of fraud, without notifying the person.

“This decision reaffirms Washington’s historic commitment to the protection of privacy rights,” said Doug Klunder, director of the ACLU-WA Privacy Project, who wrote the ACLU brief. “It will help to make sure that government has a valid reason to seek private records, and that people have an impartial way to contest those searches in court.”

This case dealt with an investigation of fraud and other charges against Michael Miles. As part of the investigation, the Washington State Securities Division issued an administrative subpoena to request all of Miles’ account records at Washington Mutual, including both business and personal records. The agency also told the bank not to inform Miles about the subpoena. Miles was convicted of the charges.

Miles’ lawyers argued that evidence gathered this way was not valid and should have been suppressed. But the trial court ruled against them; although it recognized banks records are private, it also held that banks are “pervasively regulated” institutions, so constitutional privacy rights do not apply to them.

The ACLU contended that bank records are private, and that the state needs to go through a neutral magistrate in order to get them - either by getting a search warrant, or by issuing a subpoena with notice to the subject (not just the bank) so he can go to court to contest it. The ACLU also said that there is no pervasively regulated industry exception to our state’s constitutional privacy right, or if it does exist, it's very narrow and limited solely to business records, not personal information.

Acknowledging the importance of protecting bank record privacy, the court agreed with this argument.

“Private bank records may disclose what the citizen buys, how often, and from whom. They can disclose what political, recreational, and religious organizations a citizen supports . . . Little doubt exists that banking records, because of the type of information contained, are within a person’s private affairs,” wrote Justice Charles W. Johnson.