Pubdate: Tue, 24 Jul 2001
Source: Denver Rocky Mountain News (CO)
Copyright: 2001 Denver Publishing Co.
Contact:  http://www.denver-rmn.com/
Details: http://www.mapinc.org/media/371
Note: From the St. Petersburg Times (FL)

PRIVACY OF BANKING RECORDS ANOTHER DRUG WAR CASUALTY

Our government hates money.

Now that might sound odd, since Congress is so very good at spending it, 
but the truth is, money is considered a drug-war enemy. The ease with which 
money moves without our government being able to track it has led to an 
elaborate set of rules designed to prevent narcotics smugglers from 
enjoying their illicit profits. But the consequence of these rules is that 
all of us who engage in financial transactions are now targets of 
government spying.

Today, every bank customer is a suspect. If a financial institution has 
reason to believe a transaction is out of the ordinary for that person, it 
must submit a "suspicious activity report" to the Treasury Department's 
Financial Crimes Enforcement Network. This is done without the customer's 
knowledge and it means banks are expected to know their customers' 
financial habits and revenue sources.

(For those who have been following these issues, this might sound like the 
"Know Your Customer" regulations that were defeated in 1999 when the 
government received over 300,000 negative public comments. While the 
regulations were withdrawn, the suspicious activity report program 
continues under the Bank Secrecy Act.)

Since 1997 the U.S. Postal Service Office has also been sending "suspicious 
activity reports" to the federal government. When customers of money orders 
and wire transfers seem to have more money than they should or if they seem 
to be avoiding the reporting requirements that kick in for money orders of 
$3,000 or more, a report must be filed. In a training video on how to 
identify a suspicious transaction, the postal service tells its employees, 
"It's better to report 10 legal transactions than to let one illegal 
transaction get by." The program is called "Under the Eagle's Eye." A name 
that says it all.

But getting American banks and the postal service to rat out their mostly 
innocent customers was the easy part. It's getting the rest of the world to 
join in that's been the challenge.

If you want a reason to join the black-helicopter set, read the reports put 
out by the Financial Action Task Force on Money Laundering, the 29-nation 
financial task force that includes the U.S., Germany, Japan and the rest of 
the world's richest industrial nations. The task force has developed a set 
of 40 "recommendations" to combat international money laundering that read 
like the postal services' training video.

Under the recommendations, all countries around the world are expected to 
force their banks to know their customers and their financial habits. Banks 
are also expected to submit "suspicious activity reports" on 
out-of-the-ordinary and large cash transactions, and keep the monitoring 
program secret from their customers.

Sound familiar?

According to Bradley Jansen of the Free Congress Foundation, the group that 
has been leading the battle against these incursions, "Countries are also 
supposed to set up foreign intelligence units that are not under the 
control of the government's financial regulators but under law enforcement, 
with the aim of setting up a global network of unaccountable financial police."

In June, FATF issued its annual report of "blacklisted" countries -- those 
nations that have made insufficient progress in following FATF's 
recommendations. This year Russia and the Philippines made the list, as 
well as 13 other nations.

Those that make the blacklist are subject to full-blown economic sanctions, 
something our government is loath to do, or advisories issued to our own 
banks to require detailed documentation before doing business there, an 
approach that relies on voluntary cooperation to limited effect.

But for the past two Congresses, a bill has been introduced to give the 
secretary of the Treasury vast new unilateral powers to add teeth to FATF's 
blacklist. The International Counter-Money Laundering and Anticorruption 
Act would give the Treasury secretary the option of barring U.S. banks from 
doing business with nations that refuse to compromise the privacy of their 
bank customers. And now the legislation has renewed life, since the 
chairmanship of the Senate Banking, Housing and Urban Affairs Committee has 
shifted from Republican Phil Gramm of Texas, an opponent of the measure, to 
Paul Sarbanes, Maryland Democrat, a supporter and co-sponsor.

The U.S. is saying to other nations: Spy on your people, know how they get 
and use their money or you can forget about doing business with us.

So much for our tradition of government restraint, where the actions of 
individuals are not subject to state scrutiny without probable cause.

We might pride ourselves in being a beacon of liberty, but in reality the 
light we're shining is not to advance freedom but to invade privacy. Our 
anti-money-laundering efforts are just another way we have exported our 
drug war to the detriment of civil liberties around the world.
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MAP posted-by: Terry Liittschwager