Few laws are as poorly named as the Bank Secrecy Act. Passed in 1970, the act requires that banks identify those who have cash transactions over $10,000. Banks also must report those transferring $5,000 in cash or negotiable instruments into or out of the country. With requirements like these, a more appropriate title would be "The Large Currency Handlers Act."

The intention of the act was to create an audit trail of fugitive money in what is now called "the underground economy." This audit trail could document drug and tax evasion money.

The Drug Enforcement Administration estimates that annual drug traffic is $70 billion to $90 billion. To put this in perspective, it is about what the automobile or computer industries add to the gross national product every year.

In July, at a congressional oversight hearing, the General Accounting Office issued a report on the administration of the act.

It found that, unfortunately, experience has not met Congress' expectations. Eleven years have elapsed since the law was passed, yet the survey found that only one-third of the field offices of investigatory agencies were watching the currency reports. The IRS and Customs were using them, but the DEA, FBI, Securities and Exchange Commission, and Bureau of Alcohol, Tobacco and Firearms were paying little attention, if any.

The GAO documented a typical bureaucratic snarl. The bureaucracies involved have a history of turf battles, and so are careful not to intrude on each other's territory. Enforcement agencies have been slow to cooperate in assembling and distributing the reports, and many agencies did not understand the law.

Regulations on when and how to report were not issued promptly. When issued, they were vague. Critics screamed that their financial privacy was invaded. Some of the hard-money crowd, who wanted to send their money to Swiss banks, bristled at revealing that they had sent more than $5,000 per day out of the country. Presumably, the IRS was to trust them to report their gains faithfully. But the law did catch corporations trying to move bribery money overseas, as well as drug dealers making purchases in Europe and Latin America.

The value of the reports was shown recently in Operation Greenback, a joint project started by the departments of Justice and Treasury in south Florida to attack drug traffickers using Bank Secrecy Act reports.

The Florida Federal Reserve Banks at Miami and Jacksonville generated $14 billion in excess cash from 1978 to 1980, providing the incentive for launching Operation Greenback in January 1980. By June 30 of this year, there had been 24 indictments and $9.7 million had been seized. Many more investigations are in process.

Another indication of how the reports can be successfully used was shown by a California case that resulted in 16 convictions and fines of over $1.2 million. The drug dealers involved were distributing 300 pounds of heroin a month. This is almost two tons of human misery per year removed from the streets, and some feel that even if this had been its only success, the law was worth the effort.

But there have been other successes. From 1974 to 1980, the IRS started 400 investigations using the currency reports. Customs has achieved 344 convictions, and $8.3 million in fines and civil penalties.

In spite of the successes, the GAO felt that the overall usefulness of the act was questionable, and recommended that it have a 1984 "sunset" deadline to show its worth.

The oversight hearings also showed that Congress does not understand how complex and time-consuming audits can be, especially audits of people trying to conceal their activities. Congress seemed to be reluctant to provide financial incentives for cooperating with the government and to alleviate the burden that audits of these reports can be.

The GAO did not emphasize the great progress that has recently been made. Treasury has improved its regulations. Computer problems at Customs, involving compilation and distribution of data, have been resolved. The bank regulatory agencies are increasing their auditing, while the IRS is making sure that the reports are complete and legible. The Supreme Court settled the constitutional questions in 1970.

Prosecutors are only starting to understand how the law can be used with other laws to gain convictions. For example, major drug dealers laugh at six-figure bails. The reports have been used to show why multi-million dollar bails should be set, or severe sentences imposed for first offenses.

Incredible as it may seem, records of cash shipments to Federal Reserve banks are not automated. Edmund Zito, chief national bank examiner, suggested that such automation would quickly identify financial institutions with sudden fluctuations in cash.

If enforcement does stop drug dealers from using the nation's banks, the dealers will turn elsewhere. Currently, the law does not make it clear whether money market broker-dealers must report large cash transactions. Congress ought to resolve any legal doubts about such reports now, as well as providing the SEC with the staff to monitor reporting.

Congress will not, I hope, put a 1984 sunset provision on the law without first giving the agencies the resources to make the law work. If Congress does not support the act, and sunsets it in 1984, it will truly be what William Anderson, director of the general accounting division of the GAO, called "a lost opportunity."