[Cryptography] Senator Burr: Stopping Terrorists From 'Going Dark'

[Jerry Leichter]

> 'Sen. Elizabeth Warren wrote letters to six federal agencies voicing concerns that banks were using Symphony, an encrypted messaging system that could prevent regulators from detecting illegal activities.'
> 
> 'the banks agreed to store decryption keys with independent custodians, and Symphony agreed to retain electronic communications for seven years.'
Nothing new here, actually.  The financial industry has always been heavily regulated - and heavily monitored.  Phone calls on internal lines are recorded and must be made available to the appropriate regulators.  (I helped a lawyer friend in an attempt to improve the quality of such a recording years ago, when we were still talking analogue phones and analogue magnetic tape.  The big problem was the loud beep that was put on the line regularly to remind both ends of the recording - it obscured what was being said.  When did the requirement for such a warning tone disappear?  These days, you get a verbal warning at the beginning of the conversation and that's it.)

Financial crimes have historically been almost unique in that they were "crimes of information":  Trading on illicitly obtained tips.  Improper recommendations to clients.  Exactly how something is said may be as important as what was said.  The records of the actual transactions are rarely sufficient to prove much of anything.

Much of what makes the system work is its transparent, public nature.  Financial crimes depend on keeping stuff hidden.  Trading in stocks was (at one time) only done on public exchanges, where full information about the trades (at least in terms of quantity and price) was available to all equally.  (We've let that erode, with "dark pools" and a wealth of specialty exchanges.  We'll eventually pay the price for that.)

The only other place where "crimes of information" have traditionally been dominant is in politics - selling votes and such.  Here again, we have, in theory, open meetings and records laws and such to keep the system transparent.  Private email servers for public business are forbidden, just as private conversations among brokers in public stock.  Of course, there's law, and there's reality....

                                                        -- Jerry