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I can understand trying to cut red tape, but this law was intended to fight the money laundering schemes the cartels used to fund their operations. The administ

I can understand trying to cut red tape, but this law was intended to fight the money laundering schemes the cartels used to fund their operations. The administration is threatening war with other countries under the guise of illegal drugs, but will roll over if it means they can't cheat on taxes anymore. It's not like they are rolling back the incredibly expensive and privacy invading "Know-Your-Customer" rules across banking as a whole.

nullc 2y ago
If a cartel is alone in the forest carrying out no kidnappings, assignations, drug sales, or other physical effects that can be policed by conventional means... does it matter? The beneficial ownership registration was a massive privacy invasion with little hope of providing more than an incidental benefit to the claimed applications. Those cartels would just fail to register ownership or stick patsy proxies in place. > It's not like they are rolling back the incredibly expensive and privacy invading "Know-Your-Customer" rules across banking as a whole. One step at a time.
- llamaimperative 2y ago
  Your argument is “if cartels are magically not a problem, then they’re not a problem and then this is useless?” I don’t think I understand your comment.
  - nullc 2y ago
    My point is that invading people's privacy on ownership is not a requirement for effective law enforcement against cartels. Cartels may well commit secondary crimes related to money laundering, but the things cartels do that we actually care about are not that and don't require extensive privacy invasion to police. To use a silly example, we could also cut down on cartel activity (and many other serious crimes) if every internet connected device were required to stream room audio back to the government for keyword matching and surveillance. We don't do this because of principles, because of the risk of enabling other crimes, and because it would be a bad tradeoff-- a lot of invasion when we have less invasive tools available. I'm arguing the same applies here.
    - llamaimperative 2y ago
      Financial enforcement is empirically one of our most effective tools to combat organized crime. > We don't do this because of principles, because of the risk of enabling other crimes, and because it would be a bad tradeoff Really the only reason we don't do this is because of the Constitution. The Constitution could prevent us from capturing beneficial ownership data from corporations, but indeed it does not. Of course one can make this argument in front of SCOTUS (and perhaps will some day) but there's a reason you're not making that argument now, which is that it's a bit silly on its face. Corporations are fundamentally legal objects of the state, which is why they're registered at all. You can operate whatever business you want without incorporating (and without the legal affordances thereof) and then you don't need to disclose any information to anyone.
      - nullc 2y ago
        > Financial enforcement is empirically one of our most effective tools to combat organized crime. I'd love to read more on this position. > Really the only reason we don't do this is because of the Constitution. While the US is better about privacy than many other places, most of the developed world still manages to not be a surveillance hellscape without strong constitutional protections. Besides, the constitution does very little directly to protect privacy because the framers failed to anticipate technological advancement and the size of the future bureaucratic state... we have what we have largely because of jurisprudence that has read the constitution rather expansively-- which it's done so for the same reason that nations without constitutional civil liberties still largely respect individual privacy: it's a human right which we implicitly recognize.
        TheNewsIsHere 2y ago
        And to add, it’s worth noting that most of those places in the developed world that aren’t surveillance hellscapes do have national registries of business owner information.
      - apple4ever 2y ago
        > The Constitution could prevent us from capturing beneficial ownership data from corporations, but indeed it does not It actually does, in numerous parts of it (the 9th Amendment comes to mind pretty easily). This is a bad law, with the usual bad excuse to harm innocent Americans. Point me to all the situations where this would have helped, and now compare that to the amount of time and money spent complying. Then we can have a fair debate.
- legitster 2y ago
  > beneficial ownership registration was a massive privacy invasion A corporation is a legal entity granted by a state for the express purpose of generating commerce and benefiting society. The idea that you have a right a corporation and responsibilities for its fiduciary government but not have to report its controlling interests is silly. And yes, it probably matters. Cartels are buying guns and cars and paying thugs in US dollars that they get out of the US. Even if you force them to use exclusively cash, it becomes a lot harder to move that much cash across the border without detection.
  - JumpCrisscross 2y ago
    > corporation is a legal entity granted by a state for the express purpose of generating commerce and benefiting society This is an off-piste philosophical take. It overwrites a corporation’s management’s fiduciary duty to its owners with one closer to a charity’s.
    - legitster 2y ago
      Sure it's a bit philosophical, but so is the idea of an owner's right to privacy. I don't deny a corporation's fiduciary duty to its owners. But the state issuing the corporation isn't bound to the same duty when establishing the legal terms of corporations.
      - JumpCrisscross 2y ago
        > the state issuing the corporation isn't bound to the same duty when establishing the legal terms of corporations The states forming corporations aren’t the ones requiring BOI.
        legitster 2y ago
        Sorry, by "state" here I mean the federal government. The definition and tax status of corporations, LLCs, etc already lie with the Treasury department. My point is that these definitions and requirements do not come from some sort of divine law. A government can always amend the terms of incorporating and it would still be completely within the function of modern capitalism, just as different governments around the world offer different terms when incorporating.
- donmcronald 2y ago
  > If a cartel is alone in the forest carrying out no kidnappings, assignations, drug sales, or other physical effects that can be policed by conventional means... does it matter? Yes, because that's a made up scenario. What are they doing in the forest if they're not doing something to make money? If they aren't doing anything illegal, they're a business, not a cartel. Ultimately they want money in the same system as everyone else. If you let people set up companies where the owner can't be discovered in some way, businesses set up for laundering money become an expected cost. Shut one down, another pops up. The only way you stop that is to find the people facilitating it. Having billionaires is bad enough. Anonymous billionaires is a nightmare.
  - XorNot 2y ago
    I find that scenario even funnier because there's literally an alternate version which no one in the US will even consider but would be much more effective: legalise the drugs. Let people sell them in stores. Earn taxes on the sales! The only reason drug cartels exist is because of the insatiable US demand for drugs.
    - donmcronald 2y ago
      It's an extremely difficult problem because you end up with drug addicts either way and those people aren't productive. I would consider myself a proponent of legalized marijuana, but hard drugs are a completely different scenario.
      - JumpCrisscross 2y ago
        > you end up with drug addicts either way If you end up with addicts either way and taxes only one, that seems to imply an obvious better choice?
        donmcronald 2y ago
        On the surface, yeah. I didn't explain very well, but what I meant is that you end up with drug addicts either way and you'd want to figure out which solution costs the least overall. If it were possible to calculate, it would be easy to decide which solution is best. My opinion is that things feel like they've gotten worse in Canada as we've softened drug enforcement. It's a feeling, not a fact because I can't factor out all things that cause an increase in drug use, so it's hard to say if we've seen things get worse because of softer policing or in spite of it. Every single person I know that works in a related field tells me that stuff like safe injection sites and soft on drugs policies have had a negative collateral effect on homelessness, the need for medical services, the need for police, etc.. That makes me hesitant to buy into the idea that making access to drugs easier will improve things.
JumpCrisscross 2y ago
> not like they are rolling back the incredibly expensive and privacy invading "Know-Your-Customer" rules across banking as a whole That might be the end goal. And if it is, I narrowly support it. (Yes, KYC makes cartels’ business more complicated. But it’s also a privately-administered tax on commerce and an uncloaking of NGOs and media organisations, the latter being my areas of concern with this administration.) But it’s incoherent with launching an origin-based tariff war, or purporting to be fighting e.g. cartel finances (or even illegal immigration). If a Chinese entity can sock themselves inside two Nevada corporations and purport to be American, you’re not going to collect your tariffs or enforce purchase restrictions, e.g. on chips. (Particularly for digital goods.)
timewizard 2y ago
> but this law was intended to fight the money laundering schemes the cartels used to fund their operations Did that work?
- JumpCrisscross 2y ago
  > Did that work? Our entire AML regime has scant evidence of efficacy [1]. Scrapping KYC and AML and creating a public beneficial-owner database (like the SEC’s EDGAR) for entities doing business in America would frankly be more effective. [1] https://scholarship.law.nd.edu/cgi/viewcontent.cgi?article=1015&context=ndlr_online https://scholarship.law.nd.edu/cgi/viewcontent.cgi?article=1...
  - xracy 2y ago
    I like the part where your comment about it not having evidence is right next to the comments about the evidence is yet-to-be-published.
    - JumpCrisscross 2y ago
      > your comment about it not having evidence is right next to the comments about the evidence is yet-to-be-published Beneficial ownership information is/was a new component of anti-money laundering. The previous AML had scant evidence of working. BOI was never mandated, so of course we have no evidence either way. But my priors are grim given the framework it emerges from, AML, hasn’t been particularly successful.
- legitster 2y ago
  The reporting deadline was going to be March 21, 2025.
- hristov 2y ago
  It did not work because they did not try it. They suspended enforcement before the thing was going to take effect.
- salynchnew 2y ago
JohnTHaller 2y ago
It isn't about whether a regulation works or not or is burdensome or not. It's about whether it benefits the folks making the decisions. Or the folks that are paying them. Combine this with Trump announcing that the US is gonna buy cryptocurrency as part of the US Sovereign Wealth fund and you've got a stew going.

nullc 2y ago

If a cartel is alone in the forest carrying out no kidnappings, assignations, drug sales, or other physical effects that can be policed by conventional means... does it matter? The beneficial ownership registration was a massive privacy invasion with little hope of providing more than an incidental benefit to the claimed applications. Those cartels would just fail to register ownership or stick patsy proxies in place. > It's not like they are rolling back the incredibly expensive and privacy invading "Know-Your-Customer" rules across banking as a whole. One step at a time.

llamaimperative 2y ago
Your argument is “if cartels are magically not a problem, then they’re not a problem and then this is useless?” I don’t think I understand your comment.
- nullc 2y ago
  My point is that invading people's privacy on ownership is not a requirement for effective law enforcement against cartels. Cartels may well commit secondary crimes related to money laundering, but the things cartels do that we actually care about are not that and don't require extensive privacy invasion to police. To use a silly example, we could also cut down on cartel activity (and many other serious crimes) if every internet connected device were required to stream room audio back to the government for keyword matching and surveillance. We don't do this because of principles, because of the risk of enabling other crimes, and because it would be a bad tradeoff-- a lot of invasion when we have less invasive tools available. I'm arguing the same applies here.
  - llamaimperative 2y ago
    Financial enforcement is empirically one of our most effective tools to combat organized crime. > We don't do this because of principles, because of the risk of enabling other crimes, and because it would be a bad tradeoff Really the only reason we don't do this is because of the Constitution. The Constitution could prevent us from capturing beneficial ownership data from corporations, but indeed it does not. Of course one can make this argument in front of SCOTUS (and perhaps will some day) but there's a reason you're not making that argument now, which is that it's a bit silly on its face. Corporations are fundamentally legal objects of the state, which is why they're registered at all. You can operate whatever business you want without incorporating (and without the legal affordances thereof) and then you don't need to disclose any information to anyone.
    - nullc 2y ago
      > Financial enforcement is empirically one of our most effective tools to combat organized crime. I'd love to read more on this position. > Really the only reason we don't do this is because of the Constitution. While the US is better about privacy than many other places, most of the developed world still manages to not be a surveillance hellscape without strong constitutional protections. Besides, the constitution does very little directly to protect privacy because the framers failed to anticipate technological advancement and the size of the future bureaucratic state... we have what we have largely because of jurisprudence that has read the constitution rather expansively-- which it's done so for the same reason that nations without constitutional civil liberties still largely respect individual privacy: it's a human right which we implicitly recognize.
      - TheNewsIsHere 2y ago
        And to add, it’s worth noting that most of those places in the developed world that aren’t surveillance hellscapes do have national registries of business owner information.
    - apple4ever 2y ago
      > The Constitution could prevent us from capturing beneficial ownership data from corporations, but indeed it does not It actually does, in numerous parts of it (the 9th Amendment comes to mind pretty easily). This is a bad law, with the usual bad excuse to harm innocent Americans. Point me to all the situations where this would have helped, and now compare that to the amount of time and money spent complying. Then we can have a fair debate.
legitster 2y ago
> beneficial ownership registration was a massive privacy invasion A corporation is a legal entity granted by a state for the express purpose of generating commerce and benefiting society. The idea that you have a right a corporation and responsibilities for its fiduciary government but not have to report its controlling interests is silly. And yes, it probably matters. Cartels are buying guns and cars and paying thugs in US dollars that they get out of the US. Even if you force them to use exclusively cash, it becomes a lot harder to move that much cash across the border without detection.
- JumpCrisscross 2y ago
  > corporation is a legal entity granted by a state for the express purpose of generating commerce and benefiting society This is an off-piste philosophical take. It overwrites a corporation’s management’s fiduciary duty to its owners with one closer to a charity’s.
  - legitster 2y ago
    Sure it's a bit philosophical, but so is the idea of an owner's right to privacy. I don't deny a corporation's fiduciary duty to its owners. But the state issuing the corporation isn't bound to the same duty when establishing the legal terms of corporations.
    - JumpCrisscross 2y ago
      > the state issuing the corporation isn't bound to the same duty when establishing the legal terms of corporations The states forming corporations aren’t the ones requiring BOI.
      - legitster 2y ago
        Sorry, by "state" here I mean the federal government. The definition and tax status of corporations, LLCs, etc already lie with the Treasury department. My point is that these definitions and requirements do not come from some sort of divine law. A government can always amend the terms of incorporating and it would still be completely within the function of modern capitalism, just as different governments around the world offer different terms when incorporating.
donmcronald 2y ago
> If a cartel is alone in the forest carrying out no kidnappings, assignations, drug sales, or other physical effects that can be policed by conventional means... does it matter? Yes, because that's a made up scenario. What are they doing in the forest if they're not doing something to make money? If they aren't doing anything illegal, they're a business, not a cartel. Ultimately they want money in the same system as everyone else. If you let people set up companies where the owner can't be discovered in some way, businesses set up for laundering money become an expected cost. Shut one down, another pops up. The only way you stop that is to find the people facilitating it. Having billionaires is bad enough. Anonymous billionaires is a nightmare.
- XorNot 2y ago
  I find that scenario even funnier because there's literally an alternate version which no one in the US will even consider but would be much more effective: legalise the drugs. Let people sell them in stores. Earn taxes on the sales! The only reason drug cartels exist is because of the insatiable US demand for drugs.
  - donmcronald 2y ago
    It's an extremely difficult problem because you end up with drug addicts either way and those people aren't productive. I would consider myself a proponent of legalized marijuana, but hard drugs are a completely different scenario.
    - JumpCrisscross 2y ago
      > you end up with drug addicts either way If you end up with addicts either way and taxes only one, that seems to imply an obvious better choice?
      - donmcronald 2y ago
        On the surface, yeah. I didn't explain very well, but what I meant is that you end up with drug addicts either way and you'd want to figure out which solution costs the least overall. If it were possible to calculate, it would be easy to decide which solution is best. My opinion is that things feel like they've gotten worse in Canada as we've softened drug enforcement. It's a feeling, not a fact because I can't factor out all things that cause an increase in drug use, so it's hard to say if we've seen things get worse because of softer policing or in spite of it. Every single person I know that works in a related field tells me that stuff like safe injection sites and soft on drugs policies have had a negative collateral effect on homelessness, the need for medical services, the need for police, etc.. That makes me hesitant to buy into the idea that making access to drugs easier will improve things.

JumpCrisscross 2y ago

> not like they are rolling back the incredibly expensive and privacy invading "Know-Your-Customer" rules across banking as a whole That might be the end goal. And if it is, I narrowly support it. (Yes, KYC makes cartels’ business more complicated. But it’s also a privately-administered tax on commerce and an uncloaking of NGOs and media organisations, the latter being my areas of concern with this administration.) But it’s incoherent with launching an origin-based tariff war, or purporting to be fighting e.g. cartel finances (or even illegal immigration). If a Chinese entity can sock themselves inside two Nevada corporations and purport to be American, you’re not going to collect your tariffs or enforce purchase restrictions, e.g. on chips. (Particularly for digital goods.)

timewizard 2y ago

> but this law was intended to fight the money laundering schemes the cartels used to fund their operations Did that work?

JumpCrisscross 2y ago
> Did that work? Our entire AML regime has scant evidence of efficacy [1]. Scrapping KYC and AML and creating a public beneficial-owner database (like the SEC’s EDGAR) for entities doing business in America would frankly be more effective. [1] https://scholarship.law.nd.edu/cgi/viewcontent.cgi?article=1015&context=ndlr_online https://scholarship.law.nd.edu/cgi/viewcontent.cgi?article=1...
- xracy 2y ago
  I like the part where your comment about it not having evidence is right next to the comments about the evidence is yet-to-be-published.
  - JumpCrisscross 2y ago
    > your comment about it not having evidence is right next to the comments about the evidence is yet-to-be-published Beneficial ownership information is/was a new component of anti-money laundering. The previous AML had scant evidence of working. BOI was never mandated, so of course we have no evidence either way. But my priors are grim given the framework it emerges from, AML, hasn’t been particularly successful.
legitster 2y ago
The reporting deadline was going to be March 21, 2025.
hristov 2y ago
It did not work because they did not try it. They suspended enforcement before the thing was going to take effect.
salynchnew 2y ago

JohnTHaller 2y ago

It isn't about whether a regulation works or not or is burdensome or not. It's about whether it benefits the folks making the decisions. Or the folks that are paying them. Combine this with Trump announcing that the US is gonna buy cryptocurrency as part of the US Sovereign Wealth fund and you've got a stew going.