If the bank if not licensed by the state, they could be doing very unpleasant (and possibly illegal) things with the sperm deposits.
When I was working as a paralegal for a law firm we'd deal with a lot of RESEARCH CONSENT FORMS
in relation to Sperm Donation for Stem Cell Research. They're presented to the men donating sperm in order to create embryos for human embryonic stem cell research projects. Embryonic stem cells can be found in embryos around the 5th day of development. These stem cells have the unique ability to turn into any kind of specialized human cell, such as liver cells, heart cells, pancreatic cells, or nerve cells. For this reason, embryonic stem cells can be used to study, and possibly one day help treat, diseases or injuries that have caused patients' specialized cells to die or become damaged – diseases and injuries such as Parkinson’s disease, heart disease, diabetes, and spinal cord injury.
The new human embryonic stem cells from embryos are created with the sperm through androgenesis. (Androgenesis is the process by which a sperm cell is stimulated to begin going through the very early stages of human development. Stem cells that arise from andogenesis would be genetically matched to the person who provided the sperm). In such cases, none of the sperm you donate is used to produce a baby or a pregnancy. And no embryos created from your sperm will be allowed to develop for more than a total of 14 days after they have been created through the union of sperm and egg; created through androgenesis. If any of the resulting embryos are frozen, then the time that they are frozen is not counted as part of the 14 day limit. Researchers only use your sperm to create embryos from which they attempt to get stem cells before the 14 day limit. The resulting research embryos are destroyed during the stem cell collection process. Usually, there is no guarantee that embryos will be successfully created from your sperm; and there is no guarantee that researchers will be able to get stem cells from any resulting embryos. Researchers routinely discard as medical waste any sperm or embryos they do not use for this research project.
It is likely that the collected embryonic stem cells will be stored for many years. Embryonic stem cells have the ability to self-renew indefinitely, and they are likely to be used by researchers at other institutions and for many other research purposes. One possible research use of these stored stem cells might involve changing some of their genes. Another possible research use might be to study some of the stem cells by placing them into laboratory animals. In addition, the stored stem cells might be used in the future for new research related to human stem cell transplantation. These are just 3 common examples of what might happen to the stored stem cells. But there are many other future possible research uses that are simply unknown at this time. You will have no say as to which institutions or researchers may share the stem cells made from the embryos that were created using your sperm. If stem cell transplantation studies are developed in the future, you will have no say as to who may be a transplant recipient of the collected stem cells, except in the case of autologous transplantation after androgenesis.
This is becoming indeed a problem in many states - I guess it'll continue to be an issue during the 2012 elections.