In the US, banks and most businesses who accept cash track the serial numbers of 50 and 100 denominated bills. I would imagine that banks keep a handle on the serials of their 20s as well, which are by far the bills most commonly dispensed from ATMs.
Presumably banks have something built into their money-counters and ATMs, but how does a regular cash business do this type of tracking? (I know personally several that do not.) For those that do track these, why?
My work experience includes working in retail where we hand recorded the numbers on large bills each night and in the morning. I'm pretty sure banks track these numbers; what makes you believe yours don't?
But that's completely useless for this purpose unless the bank supplying the cash also recorded the numbers, and "mostly harmless" even if they were (see below).
What makes me sure the banks I use don't suitably track the numbers is that I show up to them with $20s just acquired from an ATM (saves time) and they don't take any actions that would allow recording of the numbers of the $100s they give me in return. The bills just come out of a slot in the usual drawer, the teller only count them by hand to make sure they're all $100s and that she's giving me the right number of them. I'd add that many people would notice if she ran them through an OCR machine before handing them over....
What you're talking about sounds more anti-counterfeiting efforts, $100s having of course the highest payoff, and at worst case they only reveal that person X shopped at that establishment the day before. Which I suspect is not typically damning, e.g. that I shopped at a grocery store without any details as to what I bought suggests that I'm a human that eats food, little more.
I wouldn't say I'm "paranoid" about this sort of thing, i.e. I pay cash locally more to avoid credit card fraud than to keep details about myself private, but I read the appropriate SF when I was young, and being a hacker in the sense of this forum I pay close attention to these things. As of yet in my corner of SW Missouri there's no sign of them.
The last time I with Drew a large sum from the bank, he did run it through accounting machine and most of those have OCR abilities.
Businesses I've been involved with write down the serial numbers of high denomination bills when cash drawers are filled. I wouldn't be surprised if banks were aware of which serials were in their cash drawers for inventory purposes basically.
It's true that the only real tracking that goes on with serial numbers currently to catch criminals is recorded cereals in bank robberies and black market transactions. However, the capability is there to construct some small amount of conclusions about regular people based on where bills go. I wasn't saying it's widely in use for everyday surveillance.
