Feds Plan Bank Privacy Nightmare
A new government regulation -- scheduled to go into effect on
April 1 -- will require banks to spy on customers, compile dossiers on them,
and report vaguely-defined "unusual activity" to federal police.
It's called the "Know Your Customer" rule. It was announced in December,
and, according to civil liberties writer James Bovard in the Washington
Post: " The effect will be to
treat law-abiding citizens like drug kingpins... [this] could be a landmark
in the history
of the subversion of American privacy and property rights."
The measure is downright Orwellian. Every bank and credit union will be
required, Bovard says, to "determine its customers' sources of funds, determine,
understand and monitor the normal and expected transactions of its
customers, and report... any transactions of its customers
that are determined to be unusual or inconsistent."
Furthermore, "The new rules vastly expand the number and types of private
activities
that bankers must report to federal overseers."
According to Libertarian Party national director Steve Dasbach, under the
rule: "...bank tellers can quiz you about where you got your money and how
you plan to spend it.
And if your answers sound suspicious, they can report you to federal
law enforcement agencies. This law would turn every bank teller into a
government
informer and everyone with a bank account into a criminal suspect."
The government says it wants the information in order to be able to track
down money-laundering efforts by drug dealers and other persons engaged in
"illicit activities."
However, says Bovard: "the standards for violations are so vague that anyone
who has
a one-time surge in income --- such as selling a car or receiving a
bonus at work --- could be reported as a suspected drug dealer."
Barry Steinhardt of the American Civil Liberties Union warns that "every
time little Billy gets a large gift from his grandmother, there's going
to be a suspicious-activity report. It turns banks into cops, into
police spies for the government."
Banks will be required to let federal agents see your private financial records
within 48 hours -- no search warrant needed. Furthermore, mere suspicion of
"illegal activity" -- which could simply be a sudden increase in deposits --
could lead
to the government's seizing your entire bank account, leaving you penniless
while you try to prove in court that you're not guilty of a crime.
The law is a shredding of basic Constitutional liberties, including the
right to be free from warrantless searches, the right to be considered
innocent until proven guilty, and fundamental privacy rights.
Rep. Ron Paul (R-Texas), the only libertarian in Congress, is leading the
battle in Congress
against the proposed regulations. He has introduced HR 516, the "Know Your
Customer Sunset Act," to kill the idea.
"These rules are more like 'Spy On Your Neighbor,' and I have not yet met
anyone who likes them," Rep. Paul said. "I've heard from literally thousands
of people, and not one of them wants the government to require banks to
implement these massive new programs which turn every customer into a
presumed-guilty suspect."
The ACLU, the Libertarian Party, the Eagle Forum, the Free Congress
Foundation, the Christian Alert Network. the Texas Bankers Association, the
California Bankers Association,
the American Bankers Association and other prominent and diverse groups are
fighting it.
The Federal
Deposit Insurance Corporation (FDIC) has set March 8 as the deadline for
public comment about this devastating attack on liberty. As we go to press,
the FDIC has received over 15,000 complaints, almost all in opposition.
The Libertarian Party has set up a Web site filled with information and
commentary about the bill:
http://www.defendyourprivacy.com
(Sources: Washington Times, January 28 / Congressman Ron Paul / Libertarian
Party / Future of Freedom Foundation / John Hinkamp)
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