Efforts to track money laundering by drug dealers in the 1970s have evolved into routine investigation of financial transactions of ordinary Americans, a fact brought to light by the recent downfall of New York Gov. Eliot Spitzer.

USA Today reported March 12 that Spitzer's dalliance with a prostitute might never have come to light except that his transfer of thousands of dollars raised suspicion among bank investigators, who notified the IRS. Spitzer allegedly used the money to pay for sex.

In 2006 alone, banks, credit unions, and other financial institutions reported 17.6 million suspicious transactions to the Financial Crimes Enforcement Network. The reports are reviewed by agents from the IRS, FBI, Drug Enforcement Administration, and other federal agencies.

"I don't think Americans understand that their financial transactions are being reported and routinely examined," said Barry Steinhardt of the American Civil Liberties Union. "The government has access to untold volumes of records and can draw all sorts of conclusions about us, and many are going to be wrong."

Banks have long been required to report cash transactions in amounts of $10,000 or more, but they also file more than one million "suspicious activity reports" annually that are not based on amount, but rather unusual patterns that may indicate fraud.

"For the typical bank customer, this means very little because there's nothing they're doing that's likely to be viewed as out of the ordinary," said Richard Riese, head of regulatory compliance for the American Bankers Association.