Financial investigations are a cornerstone of the private investigation industry. Whether you are working on a high-stakes divorce, enforcing a civil judgment, or vetting a potential business partner, clients want to know where the money is.
However, the laws governing how you find that money are strict. Crossing the line between a legal investigation and an illegal intrusion can destroy your career. It can lead to revoked licenses, massive fines, and even federal prison time.
This guide explains the critical banking regulations every private investigator must know. It clarifies the difference between legal asset searches and illegal methods like pretexting.
The “Big No-No”: The Gramm-Leach-Bliley Act (GLBA)
If you remember only one law from this article, make it the Gramm-Leach-Bliley Act (GLBA). Enacted in 1999, this federal law completely changed how financial institutions protect consumer data.
For private investigators, the most critical part of the GLBA is the prohibition on pretexting.
What is Pretexting?
Pretexting is the act of creating a false narrative (a “pretext”) to obtain information. In the context of banking, it usually means impersonating the account holder to trick a bank employee into revealing a balance or transaction history.
Before 1999, this was a common “grey area” tactic. Today, it is a federal crime.
Under the GLBA, it is illegal to:
- Impersonate a customer to a financial institution.
- Use lost or stolen documents (like a driver’s license) to falsely verify an identity.
- Solicit another person (like an “information broker”) to obtain this data illegally.
The Consequences:
The penalties for violating the GLBA are severe. Individuals can face up to five years in prison and fines regarding the specific violation. If the pretexting is part of a larger criminal scheme (like theft), the prison sentence can double to ten years.
Ethical Tip: If a client asks you to “just get the bank balance,” you must explain that obtaining specific account balances without a court order or consent is illegal.
The Fair Credit Reporting Act (FCRA)
The Fair Credit Reporting Act (FCRA) governs how credit bureaus collect and share consumer credit information. Many new investigators mistakenly believe they can run a credit report on anyone they are investigating. This is false.
To access a consumer’s credit report, you must have a “Permissible Purpose.”
What qualifies as Permissible Purpose?
- Court Order: A judge explicitly orders the release of the report.
- Written Instructions: The consumer (the subject of your investigation) gives you written permission. This is common in pre-employment background checks.
- Credit & Collection: You are collecting on a specific debt, and the report is used to review the account.
What is NOT a Permissible Purpose?
- Curiosity.
- A general “asset check” for a potential lawsuit (without a judgment).
- Divorce cases (unless you have a court order or spousal consent).
Violating the FCRA allows the consumer to sue you for damages. It also puts your access to critical databases at risk.
The Right to Financial Privacy Act (RFPA)
The Right to Financial Privacy Act of 1978 was designed to protect citizens from government intrusion. It states that federal agencies cannot access an individual’s financial records without a warrant, subpoena, or the customer’s consent.
Why this matters to PIs:
While the RFPA specifically targets government authority, it sets the standard for how banks operate. Financial institutions are conditioned to deny requests for information that do not come with a subpoena. Understanding this act helps you explain to clients why you cannot simply “call the bank” and get answers.
Legal Methods: How to Find Assets Legally
If you can’t lie to the bank (GLBA) and you can’t pull a credit report (FCRA), how do you find assets? Professional investigators use a combination of Open Source Intelligence (OSINT), surveillance, and civil procedure.
1. Public Records (OSINT)
Assets often leave a paper trail in the public record. You don’t need a bank login to find wealth.
- Real Estate Deeds: Search county assessor records for property ownership. Look for properties transferred to LLCs or family members for nominal amounts (e.g., “$1.00”), which may indicate an attempt to hide assets.
- UCC Filings: When a person buys a boat, heavy equipment, or business machinery on credit, the lender files a Uniform Commercial Code (UCC) financing statement. This public record lists the debtor’s name and the collateral (the asset).
- Bankruptcy Filings: These federal records are a goldmine. They list all disclosed assets and debts at the time of filing.
2. Civil Discovery & Subpoenas
This is the most powerful tool for an investigator working with an attorney. Once a lawsuit is filed, your client’s attorney can issue a subpoena to banks, employers, and brokerage firms.
- Your Role: Your job is to tell the attorney where to send the subpoena. You use your surveillance and research to identify which banks the subject uses (e.g., spotting a specific bank’s debit card in a trash run or noting which bank they visit on payday).
3. “Trash Hits” (Refuse Audits)
In the 1988 case California v. Greenwood, the Supreme Court ruled that police do not need a warrant to search trash left on a curb. In many jurisdictions, this applies to private investigators as well.
- What to look for: Bank statements, voided checks, credit card offers, and deposit slips.
- Caution: Always check local ordinances. Some cities ban “scavenging,” and trespassing on private property (like a driveway) to get the trash is always illegal.
4. Surveillance and Lifestyle Audits
Sometimes, the best way to prove hidden wealth is to document spending that doesn’t match reported income.
- Surveillance: Document the subject driving luxury cars, wearing expensive jewelry, or vacationing at high-end resorts.
- Social Media: According to the National Endowment for Financial Education, nearly 40% of spouses admit to committing some form of financial deception. Subjects often brag about purchases on Instagram or Facebook that they denied owning in court.
Conclusion: Value Over Shortcuts
Clients hire private investigators to solve problems, not to create new legal liabilities. By adhering to banking regulations like the GLBA and FCRA, you protect your license and your client’s case.
Illegal evidence is often inadmissible in court. A “clean” investigation that uses public records, surveillance, and legal discovery provides evidence that stands up before a judge.
Research Sources
- Federal Trade Commission: The Gramm-Leach-Bliley Act
- Cornell Law School: 15 U.S. Code § 1681b – Permissible purposes of consumer reports
- FDIC: Right to Financial Privacy Act
- National Endowment for Financial Education: Financial Infidelity Statistics
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What is the regulatory code for when a cleared title on a property must be presented to the bank when a person is going through the loan process?
Question: Is there a federal regulation that if you have an American bank account and IRA that you must live in the US for 6 months and 1 day in order to have that account?
An attorney or a financial advisor would best answer that question. Government regulations require banks to correctly identify their customers before opening accounts. The rules for opening bank accounts and IRAs will vary by financial institution.
I have had this account for over 25 years and have paid taxes on it yearly. I have a legal address in the states but split my time between Australia and the US. I have no Australian income. With covid making travel next to impossible I have had to stay in Australia for an extended length of time. I am an American citizen, and this is my IRA, retirement funds and checking account. This is the 1st I have been informed of this and wanted to know if it’s my banking institution or the government that has the requirement about length of residence.
Hi. how long does a bank have to transfer funds when they say they will after having complied with them?
Depending on the financial institutins involved in the transfer, and the method they use for transferring the funds, it could take between a few hours and as many as five business days. However, it may take longer if the transfer is delayed, which can occur for several reasons (e.g., large amounts, errors in the request, etc.).
What is the criteria and capital required for a corporation or a group of people to own a a BANK or to build and own a bank?
Kind regards
finance student
Can Banker at a bank make A New Partnership agreement and not include the 3rd. partner in it, when you already have one registered with the state.
Heres an interesting one… I dont have a bank accont but my girlfriend does… after an identity theft issue, I just have a bad taste for them so I have happily been using Green Dot for all my needs. Unfortunately I recently lost my job and applied for New Jersey unemployment but they wouldnt recognize Green Dot as a viable bank to pay. So I opted for my Girlfriends account.
Lakeland Bank wants nothing to do with it and continue to push my checks back to Unemployment. Meanwhile the unemployment call center is sacked and has an automation service that explains a situation of high volume of calls and requests the next business day before hanging up. The physical offices are currently closed due to covid and The self help portal to fix the Direct Deposit (my first method of addressing this issue) has been “Temporarily out of service” for well over a month now.
My question is, can a bank legally say no to a deposit.. not a check I want cash for, but like walking in and paying cash, I’m trying to unload my unemployment to her since shes being footing the bill for my place since November when my UI was approved. this is crazy.
June of 2020 I had money deposited to me to transfer to families of some of the employies. I had never handled that much and forgot the limits for transfers. I went over 300 or 500 and they locked me down. I still have 3876.41 there because they closed the account and said I would get it in 180 weeks or 6 months. When 6 months was up they extended it again till june 2021. The money was put in my account by agreement with my fiance’s General to do the transfers for them. They are working for UN and General at base in England. After second 180 he got mad and I paid him back so the balance is mine and I want and need it. I am retired and disabled and am sick a lot. Is this action a normal or legal action?
Sorry to hear about your circumstances. We’re not able to give legal advice through this site, as we are not attorneys. However, it sounds like it is an issue you need to address with the bank that holds the account, or discuss possible legal action with an attorney.
Hello, Happy New Year. Where can I find a regulation stating that franking for scanned checks is a requirement by the banks and the security reasons?
My reply. Need help with this question.
US money in a bank in london UK. Is this taxable. The money was not met to stay in the UK. was only sent there from SA to send to the USA.
Need to find answer. Help
This question should be directed to a Certified Public Accountant. They know the tax law and should be able to answer this question.
I’m wondering about the rules that regulate how a bank can remove money from an account. I work with a small not for profit organization. We had some fraud occur on our bank account. We reported it to the bank, and sometime later, they sent a check to us for the fraud that had occurred on the account.
Then a couple months later, they removed the money from our account. I understand that they can charge fees, or charge fees if you over draw your account. But I don’t understand how they can send you a check, and then later remove the money from the account. If the check had been deposited in another bank, they could not take money from that account. Can you help me understand how a bank can just remove money from your account. This has caused our program great harm, and may destroy the not for profit.