Davis Polk partner Dan Stipano was recently quoted in American Banker discussing a new tax reporting proposal that would require financial institutions to report customers' account flow data to the Internal Revenue Service. Under the Bank Secrecy Act, banks are only required to report suspicious transactions where there is potential criminal activity, but this new proposal would turn over the financial records of millions of people who are not suspected of wrongdoing, Dan explained. He also noted certain populations of consumers are already skeptical of the banking sector, which is due at least in part to a concern that their personal records are going to be turned over to the government.

Banks, consumer advocates unite against tax reporting proposal,” American Banker (June 17, 2021) (subscription required)