Know Your Customer - March 8 deadline for comment

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An update on "Know Your Customer"

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MONDAY FEBRUARY 22 1999

March 8 is deadline for public comment on Know Your Customer

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By Olivia J. Johnson ) 1999 WorldNetDaily.com

March 8 could mean the end of financial privacy in the United States, say activists concerned about a bank snooping plan by the Federal Deposit Insurance Corp. The FDIC is proposing a rule called "Know Your Customer" that would require all U.S. banks to inform federal investigators if any unusual transactions occur in someone's financial account. An unusual transaction is any abnormal activity.

If John Q. Citizen regularly draws out $300 per month, but decides to buy a $2,000 computer one month and takes money out of his account to do so, this action could trigger a report to federal investigators, under the Know Your Customer plan.

The plan was first exposed in WorldNetDaily and has prompted a record number of public protests to the FDIC.

The Libertarian Party, which previously urged concerned citizens to write the FDIC, is now sponsoring an online petition to stop the proposal. There is a two-week period left for the public to send comments to the FDIC. On March 8 the FDIC will gather all of the comments and proceed to submit a plan of action to its board of directors.

"The FDIC has set March 8 as the deadline for public comment about the proposed regulation -- and Americans need to let the government know what they think about this 'Prove-You're-Not-A-Criminal' law," the party said in a statement.

We've got to keep the pressure on," Steve Dasbach, the party's national director said. "We've got to hit the FDIC with such an outpouring of outrage that we bury them with letters, melt down their fax machine, and crash their e-mail system."

Spying on citizens is a direct violation of our Fourth Amendment right -- the right to be free from unreasonable searches and seizures, the party points out.

You can also send your comments to: Robert E. Feldman, Executive Secretary, Attn: Comments/OES, Federal Deposit Insurance Corporation, 550 17th Street NW, Washington, DC 20429 or fax them to (202) 898-3838.

"This law will destroy your financial privacy by turning every bank teller into a government informer, and everyone with a bank account into a criminal suspect," said Dasbach. "It's a law that only the KGB could love."

) 1999 Western Journalism Center

-- (priv@priv.org), February 22, 1999

Answers

Thanks for the update. This has run into serious resistance from the beginning and hopefully will be stopped, by we the people. Stay tuned.

-- Rob Michaels (sonofdust@net.com), February 22, 1999.

Maybe its not a 'Prove-You're-Not-A-Criminal' law,".

Maybe its more of a "Watch out if youre the kind of self centred individual who would endanger the majority of sensible citizens of a country by potentially helping to cause (through uninformed panic, disinformation and selfish action) bank runs and civil unrest, for no better reason than a sad and deluded opinion that the sky will fall on your head in the next 6 months, Law"

"Spying on citizens is a direct violation of our Fourth Amendment right -- the right to be free from unreasonable searches and seizures, the party points out."

NOTE: "Unreasonable".

Simple Platonic law - ANY right (or freedom), MUST carry the corresponding price of additional personal responsibility.

You want to act irresponsibly ? Want to practice activities which could justifiably be seen as contributing to a dangerous, seditious and destabilising movement ? Fine, just dont be surprised if your rights and freedoms become limited. It seems perfectly justifiable for those burdened with the job of securing public safety to look suspiciously on people who promote (or practice) the idea of mass-withdrawl of funds from banks, KNOWING that the only likely result of that action will be economic disaster. Thats their job. Call it "precautions against economic terrorism" if you still "dont get it". (a phrase you all seem to love).

If, however, you think that your interests lie with the sort of National administration which protects Joe Average against peril wherever it may lurk, (including scare-story inspired economic disasters), then maybe you should be applauding this sensible step.

Incidentally, in many other countries, (the whole of Europe included), it's an accepted part of life that a sudden and unusual lurch in your banking activity will lead to your bank informing the police, as a precaution. That cracks down on crime as well as fraud.

But you know what they say . . .

"If you dont have anything to hide, you shouldnt have anything to fear."

-- W0lv3r1n3 (W0lv3r1ne@yahoo.com), February 22, 1999.


According to the Los Angeles Times (Feb 14, 1999, Your Money):

"The proposed rules would require the following: 1.Banks would have to determine the identity of the customer, both when an account is opened and when the customer comes in for subsequent transactions. 2. A bank would need procedures to also "determine the norrmal and expected transactions of its customers. 3. Banks would be required to know the customers' source or sources of funds. 4. They would have to identify transactions that are "abnormal or unexpected." 5. The would be required to report suspicious transactions to regulators............"

---Of course Amerika is the most free nation in the world!!! ---just as CPA's are now more like a branch of the IRS, banks are more like agents for the FBI/Justice Department.

-- Don Chen (DChen@newbie.xxxcom), February 22, 1999.


W0lv3r1n3,

First, I think that many people are concerned about privacy issues...many more people than just those preparing for Y2K.

Secondly, it's MY money that's in the banks. Being my money, I should be able to take as much of it out of the bank as I want to--anytime I want to.

If you like the European model, great. I prefer the United States.

-- Kevin (mixesmusic@worldnet.att.net), February 22, 1999.


Where did that, "Maybe its not a 'Prove-You're-Not-A-Criminal' law" Nazi " come from?

NEWS FLASH: The people of the US of A have no obligation whatsoever to support the banking/financial institutions. They have every right to withdraw all or any part of their own funds, in currency or in any other form. Anyone who tells you differently is WRONG!

You, who belong twisting in the wind with those in the government who have their own brand of toilet paper imprinted with the words of the Constitution, seriously need to understand the word UNALIENABLE!

May the last words you hear as you make your way to Hell be these: That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed, That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness.

-- Hardliner (searcher@internet.com), February 22, 1999.



Where did that, "Maybe its not a 'Prove-You're-Not-A-Criminal' law" Nazi " come from?

Ill thank you not to allege that Im in a Nazi. Try checking you know what a word means before using it. -----------------

NEWS FLASH: The people of the US of A have no obligation whatsoever to support the banking/financial institutions. They have every right to withdraw all or any part of their own funds, in currency or in any other form. Anyone who tells you differently is WRONG!

Actually, YOU'RE wrong. Check the small print on the form the bank had you sign when you opened your account. It gives them, (under quite vaguely specified circumstances), the right to limit or cut off your ability to withdraw funds. The Government, conforming to a similar set of circumstancial requirements, also has the right to impose these limitations. Or indeed to sieze that which you may have already withdrawn. Sorry if that rains on your parade. ------------

You, who belong twisting in the wind with those in the government who have their own brand of toilet paper imprinted with the words of the Constitution, seriously need to understand the word UNALIENABLE!

Ill pass over the childish personal attack. I understand the word. But youre applying it wrongly. It should be applied to the UNALIENABLE RIGHT OF THE MAJORITY TO ELECT THEIR CHOSEN REPRESENTATIVE. I think youll find that happened at the last presidential election. -------------

May the last words you hear as you make your way to Hell be these: That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed, That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness.

Ill ignore your further insult in assuming im en-route to hell. Incidentally, the text you echo is based on the concept of DEMOCRACY, (not anarchy, where everyone has the right to do anything), and youll notice that in most every element of the constitution. It is tied to the notion that an unjust Government may be removed by the will of a MAJORITY of the people. If you are under the impression that a majority of the American public wish to see a collapse of the banking system, and share your attitude of "Ill be ok, and screw those who aint", then we differ. It is the ultimate arrogance that you assume that the freedoms and rights laid down in the constitution relate directly to you and give you the right to do whatever you want. The essence of democracy is . . thats ALL the people (at best), or more usually at least a MAJORITY of the people. Nowhere is there a special section applying only to ranting doomers with a slender grip on the principles of democracy and a pre-pubescent flair for using jazzy fonts and colored text. Sorry about that. --------------

-- W0lv3r1n3 (W0lv3r1ne@yahoo.com), February 22, 1999.


I didn't say you were, "in a Nazi", I said that you were one.

I am correct in what I said. Your incomplete attempt to dissuade others can only refer to the agreement one makes when they open a time deposit account (savings account) which stipulates a time period (usually 60 days) that the bank may retain your money before they are required to give it to you. A demand account (checking account) has no such requirement, thus the name. If I demand the money in my checking account, the bank is required to fork it over, immediately.

The government has only those rights which the populace grants it, and as you are obviously aware given the fear evident in your posting, if they attempt to hold peoples' money, they will cause more "civil unrest" than they can possibly handle. An attempt to seize it after it has been withdrawn will most certainly draw gunfire.

There is nothing personal in that attack. It is directed at a specific class of evil men and if the shoe fits, wear it! The word unalienable is not as you said, but refers to, "certain Rights", among them are, " Life, Liberty and the pursuit of Happiness." You clearly do not understand the difference between a Republic and a democracy. And, in case you're just unobservant rather than a malicious liar, the majority did not vote for the traitor in the White House in the last election.

Apparently you can't read the American-English language either. I made no assumption nor intended no insult. I expressed a desire that you exit this life and find yourself in Hell with those words ringing in your ears. The words were NOT based on the concept of democracy, did NOT come from the Constitution and I made no mention of anarchy.

You continue to write as if America was a democracy, and continue to expose your own ignorance. America is (at least it's supposed to be) a REPUBLIC. Such precludes a tyrannical majority from imposing its will on a minority simply by virtue of numbers.

It is clear in what you have written that you are the one with the "slender grip".

-- Hardliner (searcher@internet.com), February 22, 1999.


Well stated Hardliner !

Thanks :o)

-- Mike (mickle2@aol.com), February 23, 1999.


Well, apparently Zippy the Pin Head (AKA W0lv3r1n3) isn't concerned at all about the possibility of losing all of his/her money. I worked for my money and I'll do what ever I want to with it.

A question, W0lv3r1n3, if I take out my money and spend it on various things (ammunition, food, alternative energy, etc...) how is that a bad thing?

"It is the ultimate arrogance that you assume that the freedoms and rights laid down in the constitution relate directly to you and give you the right to do whatever you want."

For the most part, that is exactly what I assume. The freedoms and rights are laid down in the constitution for me and every other citizen of this country, past, present, and future. We are supposed to be able to whatever the hell we want to, as long as we're not breaking the law.

Our founding fathers did basically say, "screw you" to those who would impose unfair laws upon the colonies. I'll say "screw you" to anyone who feels that they can tell me what to do with the money that I work for. It's not my fault the the banking community doesn't conduct business in a rational way.

"Nowhere is there a special section applying only to ranting doomers with a slender grip on the principles of democracy and a pre- pubescent flair for using jazzy fonts and colored text."

Nowhere does it say that we, the "ranting doomers," are somehow exempt from the rights and freedoms granted to ranting socialist nuts.

-- d (d@usedtobedgi.old), February 23, 1999.


When did we become a Democracy? I thought we were a Republic. When does a majority ever elect a president in this country? I thought it was the electoral college.

Wondering

-- wondering (hmmmm@thinking.com), February 23, 1999.



Hardliner, when people start picking holes in typo's, I take it to mean there's not much in the content of my argument that they can realistically argue with.

You, and others, seem to be tied up in a misconception that the definition of a democracy is "a government elected by a clear majority of the public". Your concept may be true where voting is compulsory and there are only 2 candidates. However, modern democracy simply requires that the person elected gains the largest proportion of votes of all those who chose to vote. In a 3 way race, a person may be elected with 40% of the vote, with the other 2 candidates gaining 30% each. Therfore, 60% of the voters did not select the succesful candidate. Thats still a democracy. A MORE democratic system is "Proportional Representation" but I hardly imagine youd be arguing for that. A democratic Republic is not an oxymoron. If The USA is not a democracy then what is it ? Totalitarian ?

If you wish to split hairs about particular types of bank accounts, then feel free. It suggests that you are intentionally missing my point, which is, that in circumstances where a bank (or group of banks) foresee a potential crisis situation afoot, (especially a "run"), a bank has the right in law to close all or any of its branches or offices, thereby effectively denying your "unalienable right" to withdraw your money. This (in most states) must be done with the agreement of the Banking Commissioner, but under the circumstances we're discussing, surely governmental and bankers interests would be the same.

If youre still in doubt, this is from the State of California Banking Regulatory Code. (Not untypical). 3600. This chapter is known and may be cited as the "Bank Extraordinary Situation Closing Act." 3603. (a) Whenever the officers of a bank are of the opinion that an extraordinary situation exists which affects or may affect one or more of a bank's offices, they shall have the authority in the reasonable and proper exercise of their discretion to determine not to open such offices on any business or banking day, or, if such offices have opened to close one or more of them during the continuation of such extraordinary situation even if the commissioner has not issued and does not issue a proclamation of extraordinary situation. The office or offices so closed shall remain closed until such time as the officers determine with respect to each such office that the extraordinary situation has ended and for such further time thereafter as may reasonably be required to be reopened; however, in no case shall such office or offices remain closed for more than 48 consecutive hours excluding other legal holidays without requesting the approval of the commissioner nor, in case such request is denied by the commissioner, for more than 24 consecutive hours excluding other legal holidays after such denial.

As you may be aware, under extreme situations, such as where a Government declares Martial Law for the protection of citizens (whatever you may feel about the rights and wrongs of such a move), it can assume powers of seizure, and, in the case of public hardship, will seize provisions or supplies from an individual in order to distribute such goods as may be needed to the broader public. So much for stockingpiling then.

And finally, in criticising my standpoint on banking and Y2k, you have the situation backwards. I'm not saying in any way that I'm IN FAVOUR of draconian measures imposed by bankers or governments on the public, simply that I'm not so naieve as to think I can play with matches and not risk burning my fingers. Its you and your ilk who are saying "prepare, take all your money, arm yourself, run to the hills". Thats the kind of attitude which will simply precipitate public panic, and cause the kind of problems that makes the above scenario possible. Like I said before, if you help to create a situation in which extreme measures will be deemed necessary, dont whine when they're put in place. Your policy is "we're in the know, so let's get what WE need before everyone else finds out". Very socially responsible im sure. You cant have your cake and eat it too.

-- W0lv3r1n3 (W0lv3r1ne@yahoo.com), February 23, 1999.


More on "Know Your Customer"

Link

TUESDAY FEBRUARY 23 1999

Lisa Ronthal is a New York City writer who lives on the Internet.

---------------------------------------------------------------------- ----------

---------------------------------------------------------------------- ---------- Turn up the volume against 'Know Your Customer'

---------------------------------------------------------------------- ----------

There's still time left in the public comment period (which ends March 8) for you to object to the FDIC's evil and pernicious "Know Your Customer" plan. As WorldNetDaily readers may know, the proposal (as published in the December 7, 1998 Federal Register) requires that banks:

Determine their customers' sources of funds.

Determine their customers' "normal and expected transactions."

Monitor customer transactions and identify transactions that are inconsistent with normal and expected transactions.

Report any "suspicious activity" to federal investigators.

Place limitations on amounts that can be withdrawn at any one time. The ostensible point is to attack money-laundering techniques employed by drug traffickers and other criminals who hide illegal profits. What this proposal will really do is to turn every bank teller into a government informer and every individual with a bank account into a criminal suspect. In a free society, the government has no business asking where you got your money or when and why you spend it. And politicians certainly have no right to force your bank to monitor your account - a form of illegal, warrantless search that unquestionably violates the Fourth Amendment.

Insight magazine reported in its last issue that, of the responses received so far during this public comment period -- which ends March 8 -- more than 11,000 have been opposed to the program. Something like ten are in favor. That's good, but it's not good enough.

We need more than a lopsided proportion of "no" responses. We need numbers enough to constitute a major public uprising. The American people's views regarding this government-mandated invasion of their privacy must be made both exquisitely and emphatically clear.

Why? Because I and many others suspect that those behind this proposed surveillance system will simply retract their proposal. Then they'll rewrite it. They'll eliminate telltale language like "profiling," claim what they're doing is a mere formalization of the status quo, and generally tidy the thing up so as to try and slip it under our radar the next time around.

Only a true mass outpouring of condemnation, as witnessed by sheer bulk of numbers, has any hope of creating enough of an impression to make a difference. The mainstream media must not only notice the story -- as some have in fact been doing -- but confer upon it the status of an "issue." Simply put, there must be weight to our opposition -- a weight that will only come with volume.

Turn up the volume.

Write to: Robert E. Feldman Executive Secretary Federal Deposit Insurance Corporation 550 17th Street NW Washington DC 20429

Fax: (202) 898-3838

Or, email comments@FDIC.gov -- but bear in mind that a snail-mailed or faxed comment may have more of an impact on the un-cyber-savvy than an emailed one. And include your name and address; anonymity is an invitation for your message to be simply thrown out (and rudeness won't help your case, either).

) 1999 Western Journalism Center

-- (priv@priv.org), February 23, 1999.


"W0lv3r1n3",

I thought you might be two faced enough to try that argument. ". . . when people start picking holes in typo's, I take it to mean there's not much in the content of my argument that they can realistically argue with."

It surely is similar to this one, isn't it? ". . .a pre-pubescent flair for using jazzy fonts and colored text. Sorry about that."

It would seem that you enjoy using such tactics, but cry foul when such are directed at you. That would indicate a certain lack of knowledge within your character, specifically that of equity.

You have also changed your tune since your second post in which you said, "(. . .RIGHT OF THE MAJORITY TO ELECT THEIR CHOSEN REPRESENTATIVE.) I think youll (sic) find that happened at the last presidential election". Most recently, you have back-pedaled off of that statement and come off with, ". . .modern democracy simply requires that the person elected gains the largest proportion of votes of all those who chose to vote." Leaving aside for the moment whether or not that is "modern democracy", your second statement clearly is in opposition to your first statement and clearly supports my notation that, ". . .the majority did not vote for the traitor in the White House in the last election."

I speak only for myself with surety, but it is my opinion that most others on this forum understand as well, the nature of a democracy and that of a republic. I am not, and no one else here seems to be either, ". . .tied up in a misconception that the definition of a democracy is "a government elected by a clear majority of the public".

Simply put, a republic is founded upon a body of law (in the case of America, the US Constitution) which guarantees each and every citizen certain rights and privileges. Such are inviolate, even by the will of the majority. A republic may contain a democracy, but it may also be based on some other system. A true constitutional monarchy is an example of such.

A democracy is simply a system in which the majority of the citizens make the rules and such are subject to change. There is no over-riding body of law that protects a minority from the tyranny of any majority or plurality, no matter how constructed. If the US of A were a simple democracy, the Supreme Court (or any court for that matter) would be unable to invalidate a law as unconstitutional even though it had been created by a majority vote. Such is obviously not the case.

As for, "splitting hairs", it seems obvious to me that there is a substantial difference between that and describing the two major types of bank accounts that most citizens hold. On the other hand, your statement, "Check the small print on the form the bank had you sign when you opened your account. It gives them, (under quite vaguely specified circumstances), the right to limit or cut off your ability to withdraw funds", seems designed to mislead the reader into believing that the bank has such rights as a matter of course and that they obtained them because the account holder negligently failed to "read the fine print".

There are a lot of laws on the books that are there because the voters were negligent, and I have no doubt that your report of California banking law is accurate. I reiterate however, that if those measures are implemented, they will cause more "civil unrest" than the government can possibly handle and that if seizures (either of cash or goods) is attempted, it will result in open rebellion and civil war.

Now, here's a direct question for you. Are you in favor of the "Know Your Customer" program, or are you not? You have already taken both sides of the issue (and a whole lot of others as well). First, when you said, "If, however, you think that your interests lie with the sort of National administration which protects Joe Average against peril wherever it may lurk, (including scare-story inspired economic disasters), then maybe you should be applauding this sensible step." And second, when you said, "I'm not saying in any way that I'm IN FAVOUR (sic) of draconian measures imposed by bankers or governments on the public, simply that I'm not so naieve (sic) as to think I can play with matches and not risk burning my fingers."

Which is it? ". . .maybe you(we) should be applauding this sensible step" or "I'm(you're) not saying in any way that I'm(you're) IN FAVOUR (SIC). . ."???? You would seem to be the one who wants his cake and to eat it too. Actually, I think that you just want your cake and your interest on it and that you're afraid that you'll not have all your gold when the smoke clears.

You are utilizing classic disinformation technique when you pull such statements from thin air as, "Its (sic) you and your ilk who are saying "prepare, take all your money, arm yourself, run to the hills". Thats (sic) the kind of attitude which will simply precipitate public panic, and cause the kind of problems that makes the above scenario possible."

By attempting to characterize me and "your ilk" (presumably the other members of this forum and possibly undefined others) as holding values which you subsequently attack, you attempt to create the illusion of unity of opinion which simply is not present. The record is here to access by any interested party. The members of this forum agree on a few things, notably the desire to discuss Y2K and various other subjects and the advisability of preparation, although we are far from unified on just what constitutes adequate preparation.

I cannot recall exactly where, or even if I specifically have, urged preparation, so let me go on record here as holding the opinion that to prepare for the worst and hope for the best is the most rational and advantageous position to take. That position seems to have wide credibility here. If you choose otherwise, so be it but to deny those who do hold such a position the right to do so is simply "undemocratic", as I would suppose you to say.

As far as, ". . .take all your money, arm yourself, run to the hills", that accusation is a composite of many positions and many statements. If someone wants to do all of that, they are (currently) free to do so.

Your (non)understanding of panic is inexcusable. You attempt to influence the behavior of others without knowing what you are talking about! Panic is the result of being faced with an unforeseen situation that requires actions and/or behavior that is not readily apparent to the one so faced. The (non)action and (non)informational policies of the federal government are far, far more likely to produce panic than a well thought out informational and preparational campaign would be. It is the visitation of highly visible and not understood disruptions to the infrastructure and the social fabric of this country, without warning and preparation, which will cause panic. It is the (non)addressing of the problem to the populace that is socially irresponsible.

You libel the members of this forum with the words, "Your policy is 'we're in the know, so let's get what WE need before everyone else finds out'". You cannot have read even a fraction of what is recorded on this forum and hold such an opinion. That leaves me with the choice of deciding whether you're just an ignorant loudmouth who's scared of losing his gold or a malicious entity who's determined to ignore all but a desire to discredit those people here who are attempting to make preparations for what we see as the distinct possibility that life as we know it is going to change radically in the near future. Neither one is the description of someone with anything of value to contribute here.

One last point. If your worst fears are realized, you'll likely never hear a whine. It will arrive somewhat later than the high speed projectile which preceded it.

-- Hardliner (searcher@internet.com), February 23, 1999.


Well, thats that then . . .shame . . It was fun, for a while.

But your last line blows any sense the previous paragraphs may have contained into the vaccuum.

I see I'm dealing with just another forum poster who makes it clear by threats (explicit or implicit, its all the same) that their final solution for those who dont agree with them is a bullet in the head.

You preach rights, and democracy, and constitutions, but when it comes down to it, your perfectly prepared to resort to violence to "persuade" those who dont agree with you.

So much for intellectual debate. Ill not be back.

-- W01v3r1n3 (not_gonna_hang_around@to_be_threatened.anylonger), February 23, 1999.


If there was any intellect involved in the "debate" here, it surely wasn't on the part of "W01v3r1n3". I certainly don't consider myself to have engaged in a debate but rather to have pointed out the inaccuracies of a misinformed (at best) or malicious (at worst) poster who advocated behavior on the part of the individual that would be to the benefit of "W01v3r1n3" regardless of any possible loss of the individual concerned and on the part of the government that clearly violates the privacy of the public.

Posters with something to contribute, even opposing views, are usually welcome here, but "spin" (such as twisting a hypothetical prediction of civil war into a threat to an individual) and refusal to answer specific questions when they don't support your perspective are usually not.

A view that anything written by a cyber-being and posted in cyberspace is threatening to an individual is so far disconnected from reality that it confers serious doubt as to the mental state of the holder of such a view. No one can climb through your modem and slap you, let alone "put a bullet in your head" (which BTW, was never mentioned)!

-- Hardliner (searcher@internet.com), February 23, 1999.



Take a deep breath, stand back and survey the BIG PICTURE. If you don't like the new banking rules that probably will go into effect, then don't use banks. Buy money orders. Or, only keep on deposit enough cash to write the required amount of monthly expenses that need to be paid by check. Take your money offshore (it's as safe as the bank down the street, so don't let the "it's so far away syndrome" bog you down-banks transfer your funds offshore over the weekend to collect interest on your money anyways). If you can't deal with it being so far away, then get a good safe. It is that simple.

-- (mass@delusions.com), February 23, 1999.

Hardliner, you're beating a dead horse ;-) There was never an intellectual arguement between you and him, he was brain dead when he first posted. Keep your intellect for those who deserve and need it.

R.I.P. W01v3r1n3

-- Chris (catsy@pond.com), February 23, 1999.


I wonder if the architects of KYC have thought through the downside of KYC? Or is it that the perceived and immediate benefits of KYC preclude all negative considerations?

KYC will cause many depositors to immediately begin a program of consistent, larger-than-needed cash withdrawals ahead of and throughout KYC in order to establish a comfortable and reasonable cash usage "profile". Though the negatives of a sudden bank run may be somewhat ameliorated under KYC, I believe the KYC policies could well deepen and extend any potential bank capitalization problems that may transpire.

IMO, KYC could well lead depositors to withdraw ultimately more cash and for longer periods of time in preparation of Y2k. But the real kicker is post Y2k. Since ANY cash transaction outside of "normal patterns" would be reported, hardly anyone aware of KYC will turn around and dump their extra cash back into their bank accounts if all turns out well, post Y2k. A large cash deposit could flag the depositor for "investigation". Instead, the depositor would either simply prefer to sit on this cash for the time being or use it to make sundry cash purchases.

In short, this cash may well take a very long time to return to the banking system through non-bank, "non-suspicious" channels because of the mere existence of the (proposed) KYC regulations. This would very likely slow the recapitalization of the banking system and would be especially counter-productive if Y2k turns out to be much less than apocalyptic.

I hope the architects of KYC are aware of this. They can't have it both ways. Cutting the flow from the system will also reduce the flow back into the system.

-- Nathan (nospam@all.com), February 23, 1999.


Here's the original text of the Know Your Customer bill:

http://www.fdic. gov/lawsregs/fedr/98knocus.txt

Here's a letter crafted by constitutional attorney Larry Becr aft to protest the new "Know Your Customer" regulations proposed by the FDIC.

http://www.ny.lp.org/le gal/kyc-fdic.htm

And one to the Federal Reserve Board http://www.ny.lp.org/leg al/kyc-frb.htm

Addresses to send your comments:

"KNOW YOUR CUSTOMER" (comment period ends March 8, 1999)

Board of Governors of the Federal Reserve System Jennifer J. Johnson, Secretary Attention: Docket No. R-1019 Board of Governors of the Federal Reserve System 20th and Constitution Avenue, NW Washington, DC 20551

Federal Deposit Insurance Corporation (FDIC) Robert E. Feldman, Executive Secretary Attention: Comments/OES RIN 3064-AC19 Federal Deposit Insurance Corporation 550 17th Street, NW Washington, DC 20429 Fax: 202-898-3838

email: comments@FDIC.gov

Office of Comptroller of the Currency (OCC) Communications Office Attention: Docket # 98-15 250 E Street, SW Washington, DC 20219 Fax: 202-874-5274

email: regs.comments@occ.treas.gov

Office of Thrift Supervision (OTS) Manager, Dissemination Branch Records Management and Information Policy 1700 G Street, NW Washington, DC 20552 Attention: Docket # 98-114 Fax: 202-906-7755

email: public.info@ots.treas.gov (include one's name and telephone number)

On other financial privacy issues generally: Financial Crime Enforcement Network (FinCEN) Mr. William Baity, Acting Director Financial Crime Enforcement Network 2070 Chain Bridge Road Suite 200 Vienna, VA 22182

http://www.treas.gov/fincen/

-- Chris (catsy@pond.com), February 23, 1999.


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