4 ms·

It really isn't so simple. My views on this are informed by https://www.bitsaboutmoney.com/archive/money-laundering-and-aml-compliance/ https://www.bitsaboutmon

It really isn't so simple. My views on this are informed by https://www.bitsaboutmoney.com/archive/money-laundering-and-aml-compliance/ https://www.bitsaboutmoney.com/archive/money-laundering-and-..., so you might want to read that. First, there are widely known techniques to beat AML. Criminals use them. Using them imposes costs. So you can reduce the profitability of crime, and therefore its frequency, without catching much crime directly. Secondly, one of the goals of AML regulations is to make it easy to construct a money laundering case against a criminal caught another way. This is kind of like putting Al Capone in jail for tax evasion. Tax evasion isn't why you want him in jail, it is just the thing you can convict him of. Prosecutors see value in these easy convictions. Are they worthwhile? That's above my paygrade. Certainly patio11 makes a case that they might not be. But both of the things that I just mentioned show that the rules are valued for reasons other than routinely catching a lot of crime.

AnthonyMouse 3y ago
> First, there are widely known techniques to beat AML. Criminals use them. Using them imposes costs. So you can reduce the profitability of crime, and therefore its frequency, without catching much crime directly. This is only reasonable if the same measures don't also impose costs on innocent people, which is not the case. And the value of doing this operates inversely with value: The crime you deter this way is the lowest value crime which is the easiest to deter through some other means, but the innocent people you most harm are the ones already at the margin who you don't want to deter/bankrupt, but you do. Which damages the most competitive markets with businesses that were operating with the thinnest margins and forces them to consolidate into something that can absorb the compliance cost. The cost of inducing that kind of market consolidation is enormous -- as we've seen time and again. > Secondly, one of the goals of AML regulations is to make it easy to construct a money laundering case against a criminal caught another way. This is kind of like putting Al Capone in jail for tax evasion. Tax evasion isn't why you want him in jail, it is just the thing you can convict him of. Prosecutors see value in these easy convictions. Undoubtedly the lobby in favor of AML laws is lazy prosecutors who can't be bothered to prove their case honestly and would rather have a vague law that causes common behavior to be a chargeable violation. But that purposeful subversion of the rule of law isn't a legitimate reason even if it wasn't imposing major costs on innocent people.

AnthonyMouse 3y ago

> First, there are widely known techniques to beat AML. Criminals use them. Using them imposes costs. So you can reduce the profitability of crime, and therefore its frequency, without catching much crime directly. This is only reasonable if the same measures don't also impose costs on innocent people, which is not the case. And the value of doing this operates inversely with value: The crime you deter this way is the lowest value crime which is the easiest to deter through some other means, but the innocent people you most harm are the ones already at the margin who you don't want to deter/bankrupt, but you do. Which damages the most competitive markets with businesses that were operating with the thinnest margins and forces them to consolidate into something that can absorb the compliance cost. The cost of inducing that kind of market consolidation is enormous -- as we've seen time and again. > Secondly, one of the goals of AML regulations is to make it easy to construct a money laundering case against a criminal caught another way. This is kind of like putting Al Capone in jail for tax evasion. Tax evasion isn't why you want him in jail, it is just the thing you can convict him of. Prosecutors see value in these easy convictions. Undoubtedly the lobby in favor of AML laws is lazy prosecutors who can't be bothered to prove their case honestly and would rather have a vague law that causes common behavior to be a chargeable violation. But that purposeful subversion of the rule of law isn't a legitimate reason even if it wasn't imposing major costs on innocent people.