4 ms·

In America, there's at least one clear example of this - laws against "structuring". Basically, they say that it's criminal to arrange financial transactions w

In America, there's at least one clear example of this - laws against "structuring". Basically, they say that it's criminal to arrange financial transactions with the purpose of avoiding laws about financial transactions. As an example, banks are required to report all deposits of $20,000. It's a right to deposit $19,999 into a bank account, nothing wrong there. But to deposit $19,999 five times in a row, rather than than $100,000 all at once? That's structuring, and it's illegal. I'm not aware of a general "law against circumventing laws" but there are certainly specific ones banning classes of behavior that exist to avoid other regulations.

mike_hearn 10y ago
Structuring laws are highly controversial and have caused huge amounts of pain for innocent people who were just legitimately trying to reduce their paperwork burden. They're bad laws.
- Bartweiss 10y ago
  Yeah, I don't mean to endorse them, especially not as-written. Any time you make laws like "it is illegal to circumvent the law" you're inviting exponential amounts of red tape. Add that to laws that were already high-burden on small businesses, and it's a recipe for real trouble (made even worse by the fact that a remarkable amount of banking still isn't digital). I know that the specific case I mentioned has been fairly useful in fighting money laundering and large-scale drug-dealing, though. There's something to be said for making it hard to move large amounts of money through banks without being observed, but as always there's no good way to do that without interfering with legitimate commerce.
- omni 10y ago
  Do you have any other examples which you think are bad? The $19,999 example seems pretty reasonable to me.
  - wl 10y ago
    The example he gives is of someone clearly trying to evade the reporting requirements. People get caught up in these laws even when they don't intend to avoid them by virtue of doing business in cash with daily deposits just under the reporting limit[1]. [1] http://reason.com/blog/2016/02/04/after-finally-returning-the-money-they-s http://reason.com/blog/2016/02/04/after-finally-returning-th...
- gnopgnip 10y ago
  The laws only apply to cash deposits, not money orders, checks, or any electronic transfers. What is a better alternative to stop money laundering?
  - toast0 10y ago
    Reduce the impact of the reporting. Many of the stories I read had a component of "big weekly deposits took a long time because someone would have to fill out a report" or "banks closed my account because they didn't want to fill out the reports" which lead people to do more frequent deposits or split their banking between multiple banks or pay expenses in cash. I don't think the amount triggering reporting is linked to inflation either. I don't know what's on the form, but of you fill out once a week, there should be a way to be quick about it.
6stringmerc 10y ago
It's $10,000 and that's what led to former Speaker of the House Dennis Hastert being investigated regarding his payments of hush money. He was actively trying to circumvent the controls. That's against the law. Just a clarification, having taken anti-money laundering compliance courses on occasion.
- rpgmaker 10y ago
  That's because of the Patriot ACT, a law he helped to pass btw: https://twitter.com/mtracey/status/718656246400880641 https://twitter.com/mtracey/status/718656246400880641
SilasX 10y ago
Does this raise all sorts of issues related to the Sorites Paradox and induction? "It's illegal to break the transaction into pieces of size n-1 to circumvent the law against n sized pieces. And so it's illegal to break it into n-2 sized pieces to circumvent the circumvention of breaking into n sized pieces. And so it's illegal to ..."
- Bartweiss 10y ago
  Pretty much, yes. I think that's what drove the decision to write a law criminalizing "attempts to avoid" rather than anything specific, but it doesn't actually avoid the paradox. It's a bit of a hazy crime, and one that should be probably only be pursued when there's outside evidence of guilt. As far as I know, the floor is defined by either "this would be too inconvenient even for money launderers" or "the false positive rate is too high to pursue this more strictly".

mike_hearn 10y ago

Structuring laws are highly controversial and have caused huge amounts of pain for innocent people who were just legitimately trying to reduce their paperwork burden. They're bad laws.

Bartweiss 10y ago
Yeah, I don't mean to endorse them, especially not as-written. Any time you make laws like "it is illegal to circumvent the law" you're inviting exponential amounts of red tape. Add that to laws that were already high-burden on small businesses, and it's a recipe for real trouble (made even worse by the fact that a remarkable amount of banking still isn't digital). I know that the specific case I mentioned has been fairly useful in fighting money laundering and large-scale drug-dealing, though. There's something to be said for making it hard to move large amounts of money through banks without being observed, but as always there's no good way to do that without interfering with legitimate commerce.
omni 10y ago
Do you have any other examples which you think are bad? The $19,999 example seems pretty reasonable to me.
- wl 10y ago
  The example he gives is of someone clearly trying to evade the reporting requirements. People get caught up in these laws even when they don't intend to avoid them by virtue of doing business in cash with daily deposits just under the reporting limit[1]. [1] http://reason.com/blog/2016/02/04/after-finally-returning-the-money-they-s http://reason.com/blog/2016/02/04/after-finally-returning-th...
gnopgnip 10y ago
The laws only apply to cash deposits, not money orders, checks, or any electronic transfers. What is a better alternative to stop money laundering?
- toast0 10y ago
  Reduce the impact of the reporting. Many of the stories I read had a component of "big weekly deposits took a long time because someone would have to fill out a report" or "banks closed my account because they didn't want to fill out the reports" which lead people to do more frequent deposits or split their banking between multiple banks or pay expenses in cash. I don't think the amount triggering reporting is linked to inflation either. I don't know what's on the form, but of you fill out once a week, there should be a way to be quick about it.

6stringmerc 10y ago

It's $10,000 and that's what led to former Speaker of the House Dennis Hastert being investigated regarding his payments of hush money. He was actively trying to circumvent the controls. That's against the law. Just a clarification, having taken anti-money laundering compliance courses on occasion.

rpgmaker 10y ago
That's because of the Patriot ACT, a law he helped to pass btw: https://twitter.com/mtracey/status/718656246400880641 https://twitter.com/mtracey/status/718656246400880641

SilasX 10y ago

Does this raise all sorts of issues related to the Sorites Paradox and induction? "It's illegal to break the transaction into pieces of size n-1 to circumvent the law against n sized pieces. And so it's illegal to break it into n-2 sized pieces to circumvent the circumvention of breaking into n sized pieces. And so it's illegal to ..."

Bartweiss 10y ago
Pretty much, yes. I think that's what drove the decision to write a law criminalizing "attempts to avoid" rather than anything specific, but it doesn't actually avoid the paradox. It's a bit of a hazy crime, and one that should be probably only be pursued when there's outside evidence of guilt. As far as I know, the floor is defined by either "this would be too inconvenient even for money launderers" or "the false positive rate is too high to pursue this more strictly".