The administration announced proposed legislation yesterday to protect individuals against unauthorized snooping into their private financial affairs. The bill also gives consumers the right to know what is in their credit files and to what use the information is being put.

The Fair Financial Information Practices Act, for which the White House is now seeking sponsors, would affect consumer credit bureaus, credit card companies, credit and check authorization services and insurance companies as well as banks, savings institutions and credit unions. A companion measure, the Privacy of Electronic Fund Transfers Act, would restrict access to computerized financial transactions as they occur, in the same way wire tapping is restricted.

In presenting the package, Commerce Secretary Juanita M. Kreps declared, "The need for this legislation arises not from any pattern of abuse; rather, it is an outgrowth of the dramatic and fundamental changes in our society that are being fashioned by technology."

She continued: "While we are still a long way from approaching the Orwellian nightmare that excesses could produce, we must guard against the obvious potential for abuse that the electronic age poses."

Earlier this year, a Harris poll revealed that nearly two thirds of the American people are concerned about threats to their privacy. Fourty-four percent felt that finance companies and credit bureaus asked for too much personal information; a third expressed the same attitude about banks and credit card companies. According to an unreleased poll by the University of Illinois, four out of five banks do not tell their depositors what is being done with their personal financial information or to whom it is given.

Specifically, the bill would allow consumers denied credit to see the relevant information in their files, to copy and correct it if necessary. Credit agencies would be prohibited from collecting data under false pretenses.

Access to records would be barred to third parties except for legitimate business purposes. For example, an attorney in a civil case would have to get a subpoena to get at a person's bank records, and the account holder would have the right to challenge disclosure in court after notification by the bank.

Last year the Right to Financial Privacy Act was passed restricting access by government investigators, such as the Internal Revenue Service and the Justice Department, to bank and credit card company data. However, the law allows the government to inspect records without notifying the subject if the knowledge of such a search would impede the investigation by allowing the suspect to flee or destroy the evidence. A similar emergency provision is contained in the Electronic Fund Transfers Act.

Two years ago the Supreme Court in the Miller decisions held that a person's financial records were the property of the bank and the owner was not entitled to expect confidentiality. The proposed legislation would reverse the Miller decision by creating a clear, legally enforceable expectation of confidentiality. In a case where the individual's financial privacy is not protected, he could sue the bank. Unlawful interception of electronic fund transfers carries a criminal penalty.