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I get that money laundering is always linked to criminal activity, but how have we always just accepted the lack of personal privacy when it comes to finance? P

• auntienomen 5y ago
  If you don't interfere with money laundering, the criminals eventually acquire enormous wealth, and with it power. They eventually acquire enough power to take over the government. At that point, you're at their mercy, and theorizing about privacy laws becomes a bit pointless.
  • rusabd 5y ago
    So you are saying that before money laundering laws those criminals took over the government. It is almost like said criminals just don't want any competition now
    • auntienomen 5y ago
      Money laundering laws emerged after criminals started getting organized about managing their wealth. Before Prohibition and Meyer Lansky, they were all small timers.
  • crispyambulance 5y ago
    > eventually acquire enough power to take over the government I wonder, recalling the Panama Papers incident, if this has effectively happened already!
  • jb775 5y ago
    This has already happened. They typically launder money via "foundations" or "charities". They acquire power by purchasing media companies. They use the media companies to control public narratives to shift the Overton window of public policies. They also use it to manipulate the truth as it suits them[1]. Their target population for controlling thought narratives are yuppies and the lower classes. [1] https://mobile.twitter.com/DrewHolden360/status/1397335324414590978 https://mobile.twitter.com/DrewHolden360/status/139733532441...
• tluyben2 5y ago
  I don't think the public cares. And, of course, there are many news articles, like this but also about fiat, that show why 'privacy is bad, ok'; criminals will run rampant if we cannot track everything you do.
  • JKCalhoun 5y ago
    It seems as though large movements of cash is actually a pretty good way to find criminals. Someone saying "the privacy of someone moving $100M is bad" sounds reasonable to my public ears.
  • atatatat 5y ago
    Right, because the art trade is so hard to notice.
• MikeDelta 5y ago
  I understand your point. However, privacy cannot shield one from tax and legal obligations. It is not just the proceeds from criminal activities, but also tax evasion (from the rich or companies) and terrorism financing.
  • exo762 5y ago
    You can use cryptocurrency which hides all of your transactions (like zcash) and pay your taxes as a law abiding citizen. There is no conflict here. Tax systems rely on citizens reporting anyway.
    • n_ary 5y ago
      > You can use cryptocurrency which hides all of your transactions (like zcash) Nit: only if you use zcash shielded wallets(very rare & resource hungry) are your assets private. Most wallets use transparent addresses, which is kind of similar to normal ones. Given current landscape, only monero is defacto private.
      • dougk16 5y ago
        PirateChain and Aeon as well.
        • 3np 5y ago
          And AZTEC on Ethereum.
      • deleted 5y ago
        [deleted]
    • ip26 5y ago
      Tax systems follow a “trust but verify” model.
      • exo762 5y ago
        Again, not a problem. ZCash allows one to cryptographically prove transactions.
• kd913 5y ago
  Data can be stored, transparent but open for legitimate purposes. I don't think it's a good idea to go to the other extreme for complete anonymity in a case like this whether the consequences result in massive criminal activities. E.G. I trust my medical data to my doctor with some reasonable confidence they are using it responsibly. Same thing here, I can trust my financial institutions with my data, but I want it to be open to authorities to look for criminal activity. I would ideally like that data to be placed under some legislation a la the GDPR to ensure it's used responsibly. To be clear, I would much rather my data be sold to some advertisers than for corruption/criminal activity to exist.
  • psychlops 5y ago
    I prefer the innocent until proven guilty model.
    • NateEag 5y ago
      In the US legal system, that refers to whether you can be punished for a crime, not investigated for one.
      • psychlops 5y ago
        An investigation that would require a warrant. My point being that all activities should not be considered criminal by default thereby available for perusal without a legally provided reason. And only then if very narrow in scope.
        • NateEag 5y ago
          The OP didn't say he wanted all financial activities to be considered criminal - just available for investigation. I get that's not what you want, but it is what OP wants and I can see why. All part of the eternal struggle between individual freedom and societal good.
• deleted 5y ago
  [deleted]
• rmah 5y ago
  Money laundering is not always linked to criminal activity except in so far as money laundering it itself illegal. Many nations (and not just "third world" nations) have some pretty onerous restrictions of flow of capital. A lot of money laundering activity is simply people moving money between jurisdictions. Admittedly, sometimes (usually?) with illegal goals such as tax evasion, but not always.
  • seanhunter 5y ago
    Money laundering is linked to criminal activity by definition. It literally means introducing the proceeds of criminal activity into the legitimate financial system. https://www.investopedia.com/terms/m/moneylaundering.asp https://www.investopedia.com/terms/m/moneylaundering.asp
    • wpietri 5y ago
      I think that's a good general definition. But sometimes people want to move capital unlinked to crime across borders. They then use exactly the same mechanisms money launderers use. If you have a term for that you like better, I'd be interested to hear it.
      • seanhunter 5y ago
        If it's not the proceeds of crime, but just money leaving because of unfavourable domestic policies, it's normally called "capital flight" rather than money laundering.
      • irtigor 5y ago
        That's only true if they are trying to avoid taxation, which is also ilegal (even if you think it is justified). Moving capital from a place to another doesn't use the same mechanisms of money laundering if done legally.
        • wpietri 5y ago
          That's not the case. As mentioned elsewhere in thread, some places have limits on capital movement.
• ectopod 5y ago
  > but how have we always just accepted the lack of personal privacy when it comes to finance? We didn't. This is something that has changed in the UK in my lifetime. Unless you were the subject of an investigation you didn't have to provide much detail to the tax authorities, and what you did provide was kept strictly separate from other areas of government. There was an attempt to strike a balance with the emphasis on privacy. Nowadays the government thinks it is entitled to all the data all the time.
  • celticninja 5y ago
    That's not the case at all. HMRC is very proscriptive about what you can do with their data, that's if they let you near it all, even then client consent is absolutely required for each access.
  • nly 5y ago
    The UK is a more or less a cashless society, give or take a few regional variations and laggards. I've lived in London for 3 years and don't think I've ever used cash for anything in that time. Trains, buses, taxis, bills (don't even need snail mail for those), restaurants, shops. Outside of London it's a little different, but it's only a matter of a a few more years.
• camgunz 5y ago
  I think in the US, it's a war on drugs thing--though it could also be a Cold War thing. Just musing though, but yeah it's wild that we don't think this is a right.
  • URSpider94 5y ago
    It goes back further than that, at least to the prosecution of organized crime syndicates in the early part of the 20th century. Al Capone went to jail for tax evasion, after all.
    • camgunz 5y ago
      Yeah for sure, famously. I think the evolution of like, KYC and the global financial surveillance system probably came about for Cold War or War on Drugs reasons though.
• jackfoxy 5y ago
  > how have we always just accepted the lack of personal privacy when it comes to finance? It was very easy. The American public was hoodwinked into accepting the 16th Amendment (levying an income tax) as a tax the rich scheme. And like all tax the rich schemes it was a cover to tax everyone, especially the middle class. You can't have an income tax without the government prying into everyone's finances. Before this financial privacy was the norm.
  • CryptoPunk 5y ago
    The income tax was first introduced in the UK, in 1799, to fund a war against France, and the rate was only 10%, and only levied on the rich. The first American income tax was also introduced in a war - the Civil War.
    • jackfoxy 5y ago
      IIRC the US Supreme Court declared the Civil War era income tax unconstitutional, which is why it required a constitutional amendment.
      • bluGill 5y ago
        No, they said the tax on capital gains was unconstitutional. An income tax itself was allowed, they only tossed out the whole law because it was obvious that the tax code they ruled unconstitutional wouldn't make sense without the capital gains tax parts.
• wpietri 5y ago
  There's a difference between privacy and secrecy. If I'm involving my bank, what I'm doing is already not secret. My bank knows. But normally they keep those things private, because it's generally not anybody's business. There are occasions where society's interest in preventing crime outweighs personal privacy, and one way to look at that is that when something (like, say, ransomware) has an effect on other people, it can no longer be reasonably called private. When that happens, as long as there are reasonable checks and balances, I'm fine with banks giving out information, especially when it's organizations that generally respect the privacy of the people involved.
  • meowface 5y ago
    I think this is a valid argument. I also think a corollary argument is that it's also valid to decide not to use a bank, though, and do a lot of things purely through cryptocurrency even if you're not doing anything shady or illegal, since, as another comment says, "as long as there are reasonable checks and balances" isn't necessarily a guarantee you can always rely on: https://news.ycombinator.com/item?id=27315773 https://news.ycombinator.com/item?id=27315773 >> but how have we always just accepted the lack of personal privacy when it comes to finance? >We didn't. This is something that has changed in the UK in my lifetime. Unless you were the subject of an investigation you didn't have to provide much detail to the tax authorities, and what you did provide was kept strictly separate from other areas of government. >There was an attempt to strike a balance with the emphasis on privacy. Nowadays the government thinks it is entitled to all the data all the time.
    • wpietri 5y ago
      People definitely have differing views on what "reasonable checks and balances" mean; here in the US we have whole movements of people with... strong opinions on the topic: https://en.wikipedia.org/wiki/Sovereign_citizen_movement https://en.wikipedia.org/wiki/Sovereign_citizen_movement I agree it's valid not to use a bank; one could try to conduct all one's business in cash. But in practice, people doing that are often doing something criminal, so people using cryptocurrency should not be surprised that they end up being treated with the same level of scrutiny as people running around with briefcases of cash. That is to say, their attempts at secrecy may result in a practical loss of privacy.
• Empf 5y ago
  Tax fraud. You would not benefit from it you would loose money
• mdavis6890 5y ago
  It's important to realize that attribution - knowing which human got which money when - is actually very important in many contexts, particularly when a lot of money is involved. This allows for an un-do button in the case of mistakes, fraud, etc. If I'm wiring my down payment for a house for $200k, it's nice to know that if I fat-finger the receiving account I can get the money back. How would you feel paying your down-payment in cash or BTC? How about when Citi accidentally paid an extra $900M (or something like that). Normally they'd be able to get all the money back (actually in that case they couldn't, but that was a weird anomaly). I'm all for privacy, anonymity, etc - which is one of the reasons I'm very excited about crypto - but you always have to look at things from multiple angles.
  • loceng 5y ago
    I believe the $900M was merely paid earlier than it needed to be, but was still owed, so why the transaction wasn't reversed.
    • mdavis6890 5y ago
      Yes, but still normally this mistake would be unwound. The recipients would just send the money back, or a court would tell them to send it back, even though the money was owed. But there were a number of confounding factors - for example that the money wasn't owed by Citi - it was owed by someone else and Citi was just paying on their behalf.
  • pliny 5y ago
    Voluntary attribution is a solved problem in cryptography, so you can stay private if everything goes well and prove you are the sender or receiver for a given transaction if you need it reversed.
  • ucha 5y ago
    Attribution is important but you don't need the government to be able to do it without your authorization. You can very well have private unattributable transactions that you decide to disclose to the authorities only if you need and want to. If you send your coins from wallet A to wallet B with CoinJoin, it's not possible for a third party to identify this transaction, but you can disclose the seed of wallet A and sign a transaction from wallet B thus proving ownership of both.
• matheusmoreira 5y ago
  Nobody accepted this. Governments just imposed it on us.
• vmception 5y ago
  > I get that money laundering is always linked to criminal activity Its not. Well, by definition it is but it is paradoxical. Money obfuscation is not illegal, but when the source of the money is illicit then money obfuscation is money laundering, but successful money laundering means nobody can ever distinguish between a licit or illicit source, and it is up the accuser to prove the source was illicit, which should be impossible. (Whether there are records or not, there should be no probable cause to receive or act on those records at the standard needed for a criminal investigation) So, only unsuccessful money laundering is linked to criminal activity, and deterrence relies on stigmatizing all money obfuscation.
  • deleted 5y ago
    [deleted]
• StanislavPetrov 5y ago
  >The language used by law enforcement is quite alarming, it suggests that they should be privy to ALL transactions made, regardless of reasonable suspicion. Unfortunately this is exactly their position, which they have made quite clear - and it isn't limited to financial transactions. Its the same line of "reasoning" they use to decry the use of encryption. They want to eliminate the concept of privacy all together and be privy to all of your transactions, communications and behavior to ensure nobody is "breaking the law". This was the whole idea behind the Orwellian "Total Information Awareness" program that was so obviously antithetical to freedom that the government was forced to change the name (while continuing to develop the program). In my opinion its far better to live in a free society where we are legally entitled to privacy and a few bad actors get away with crimes than the alternative. https://en.wikipedia.org/wiki/Total_Information_Awareness https://en.wikipedia.org/wiki/Total_Information_Awareness