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New Banking Regulation Delivers Serious Blow To Privacy Rights
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| Contributor | kal |
| Last Edited | kal May 01, 2010 05:25am |
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| Category | General |
| News Date | Saturday, May 1, 2010 11:00:00 AM UTC0:0 |
| Description | In its relentless drive to monitor every facet of our lives, the federal government may soon force the nation’s financial institutions into becoming Big Brother’s eyes and ears.
This will be the result of a new proposed regulation by the Federal Deposit Insurance Corporation (FDIC) called Know Your Customer (KYC). According to the FDIC plan, "the regulation would require each member and non-member bank to develop a program designed to determine the identity of its customers; determine its customers’ source of funds; determine the normal and expected transactions of its customers; monitor account activity for transactions that are inconsistent with those normal and expected transactions; and report any transactions of its customers that are determined to be suspicious ..."
The coming regulation is a far cry from current laws that require banks to report cash deposits over $10,000 in order to identify possible criminal activity. Under KYC, banks will be forced to collect the private information of every account holder and then create computer "profiles" of their customers’ "typical" transactions. From that point, any transaction that is not consistent with an account holder’s "profile" will be reported to federal authorities.
For instance, if a citizen sells his car for $2,500 in cash and then deposits the money into his bank account, he’ll most likely be paid a visit by the Federal Bureau of Investigation (FBI) if a $2,500 cash deposit is not a "normal" transaction for him. Likewise if the same person were to withdrawal $2,500 in cash, he will likely be investigated for buying drugs, laundering money or evading taxes. |
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