Bank Account Searches, are They Permissible or Not?
When people are going through divorce; or when executors or personal representatives are trying to figure out what assets the deceased owns; or when an injured party and their attorney are seeking recovery from someone; or before a company is to hire a key employee; an asset search of the target or subject is usually a crucial part of the whole process. The scope of what the subject owns, such as bank accounts, or owes to creditors, often indicates how much can be attached and paid through litigation.
Many attorneys acting on behalf of their clients are seeking to find out the subject’s complete financial status, including bank accounts. It is not uncommon to see ads for bank account searches by asset search companies but be aware. Any of those asset search companies who claim to be capable of conducting a bank account search is doing so by the use of false pretense. Not only is it an invasion of privacy, and considered to be an unfair and deceptive business practice to conduct a bank account search, it is also a federal crime under the Financial Services Modernization Act, which was signed into law on November 12, 1999 by President Clinton. According to the Act, except for some very limited exceptions, anyone who obtains bank account information through false pretense, or other fraudulent acts, or requests the information when it is known, or should be known, that false pretenses will be used, can be fined or even face criminal liabilities. Moreover, an attorney, who has a bank account search conducted on their behalf, could be held vicariously liable.
Therefore, you should be very cautious when someone is offering to provide bank account search, especially if you are an attorney requesting the information on behalf of your client. The information can hardly help your client in court because they are collected through illegal means. As an attorney, you can also be exposed to liabilities for professional misconduct and even vicarious criminal liabilities.
Choosing an assets search company staffed with experienced attorneys who know the legal boundaries when conducting an asset search is in the best interests of your clients, and yourself.