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Don't blame Bank of America. For that matter, any bank. One day, we all realize that Stasi is better than the current regime of electronic surveillance. Bank S

Don't blame Bank of America. For that matter, any bank. One day, we all realize that Stasi is better than the current regime of electronic surveillance. Bank Secrecy Act, Patriot Act, etc are behind this. Now know the power of administrative state: when laws are passed, much of the content of these laws are filled up by regulatory bodies. In this case, FINCEN is responsible for filling up this content. FINCEN assumes that every untraceable monetary instrument (cash, cashier checks, money orders, bank checks, etc) is DIRTY by default. If a bank doesn't know enough details (dob, citizenship, driver license number, ssn, passport number, etc) about controlling parties of any account (LLC, sol prop, C-corp, S-Corp, individual accounts), such accounts are seen as DIRTY. In other words, these are seen as potential sources of money laundering. FINCEN makes banks responsible for spying and reporting any suspicious activity. Banks spend $100B a year on this compliance. There is a $2B software industry behind this (AML compliance software). These software companies hire ex-regulators from FINCEN etc.

s73v3r_ 8y ago
"Don't blame Bank of America. For that matter, any bank. " I absolutely can and will, because those banks are run by people. People who are capable of telling right from wrong. "Bank Secrecy Act, Patriot Act, etc are behind this. Now know the power of administrative state: when laws are passed, much of the content of these laws are filled up by regulatory bodies. In this case, FINCEN is responsible for filling up this content." No. Neither of those requires this course of action.
- raincom 8y ago
  CDD (customer due diligence) became a rule on May 11, 2018 [1]. FINCEN forced banks to do it. Even though it is not in Bank's best interest to go through this exercise at all, they are forced by regulatory laws. There is a whole group at every bank dedicated to this: compliance teams, led by a chief compliance officer. Every bank is examined by internal auditors, external auditors, regulators to see whether a bank is in compliance. Yes, banks run by people; laws are written by people; regulators are people. The issue is not people per se: which set of people has MORE discretion? In this case, compliance teams at banks don't have much discretion. FINCEN has discretion to fill up the content of laws in the name of new rules. Recently, Congress has started attacking this AML-regulation beast; there are a couple of bills in congress, which can ease AML compliance burden. By the time, any reforms are passed, KYC (know your customer, EDD (enhanced due diligence), and CDD (customer due diligence) become the status quo. Of course, we could have expected Banks to push back, by sending lobbyists to rewrite laws. Banks are also helped by software tools to generate letters, file SAR(suspicious activity reports), CTR (currency transaction reports), etc. If there were no automated way of doing these, yes, they would have gone to Congress to push back. As long as there is some automation, expect more of this surveillance. [1] https://www.fincen.gov/news/news-releases/fincen-reminds-financial-institutions-cdd-rule-becomes-effective-today https://www.fincen.gov/news/news-releases/fincen-reminds-fin...
  - deleted 8y ago
    [deleted]

s73v3r_ 8y ago

"Don't blame Bank of America. For that matter, any bank. " I absolutely can and will, because those banks are run by people. People who are capable of telling right from wrong. "Bank Secrecy Act, Patriot Act, etc are behind this. Now know the power of administrative state: when laws are passed, much of the content of these laws are filled up by regulatory bodies. In this case, FINCEN is responsible for filling up this content." No. Neither of those requires this course of action.

raincom 8y ago
CDD (customer due diligence) became a rule on May 11, 2018 [1]. FINCEN forced banks to do it. Even though it is not in Bank's best interest to go through this exercise at all, they are forced by regulatory laws. There is a whole group at every bank dedicated to this: compliance teams, led by a chief compliance officer. Every bank is examined by internal auditors, external auditors, regulators to see whether a bank is in compliance. Yes, banks run by people; laws are written by people; regulators are people. The issue is not people per se: which set of people has MORE discretion? In this case, compliance teams at banks don't have much discretion. FINCEN has discretion to fill up the content of laws in the name of new rules. Recently, Congress has started attacking this AML-regulation beast; there are a couple of bills in congress, which can ease AML compliance burden. By the time, any reforms are passed, KYC (know your customer, EDD (enhanced due diligence), and CDD (customer due diligence) become the status quo. Of course, we could have expected Banks to push back, by sending lobbyists to rewrite laws. Banks are also helped by software tools to generate letters, file SAR(suspicious activity reports), CTR (currency transaction reports), etc. If there were no automated way of doing these, yes, they would have gone to Congress to push back. As long as there is some automation, expect more of this surveillance. [1] https://www.fincen.gov/news/news-releases/fincen-reminds-financial-institutions-cdd-rule-becomes-effective-today https://www.fincen.gov/news/news-releases/fincen-reminds-fin...
- deleted 8y ago
  [deleted]