[Cryptography] People vs AI

[John Gilmore]

Jerry Leichter <leichter at lrw.com> wrote:
>                      Banks (in the US, though those doing international
> business end up getting pulled into these rules anyway) are subject to
> "Know Your Customer" rules - which some see as very intrusive, but
> others see as a way to be sure that those you deal with can be held to
> their obligations.

Well, no.

Before KYC rules, banks did exactly as much diligence as they thought
they needed, to collect on debt, or know who they should allow to
withdraw money held on deposit.

KYC rules are different.  The US federal government forced banks into
"know your customer" (KYC) rules, largely to bypass the Fourth
Amendment, for the benefit of the government.  KYC rules require that
banks collect personally identifying information, and report it to the
government on request (or anytime the bank is "suspicious", or anytime
more than $10,000 in cash passes thru the bank).  Those rules have now
been extended to a wide variety of businesses other than banks, such
as real-estate brokers.

This has zero to do with making debts enforceable.  It has everything to
do with the federal government mandating pre-crime surveillance, so that
they don't have to deal with the pesky Fourth Amendment if they ever
want to investigate anyone who ever does financial transactions.
Instead of collecting information with a warrant or subpoena from the
person being investigated, they prefer to collect it from a third party
who has no legal rights, no legal recourse, and no incentive to fight
the warrant.  But that only works if they require the third party to
collect the info long before the government asks for it.

They recently expanded that mandate to require immediate reporting of
any cash transactions $200 or over, near the US/Mexico border, to the
Federal government:

  https://home.treasury.gov/news/press-releases/sb0048

These are the same FINCEN jokers who got a bill through Congress (the
"Corporate Transparency Act", attached to a war-department funding bill)
that mandated pre-crime government-identity-card and mug-shot reporting
to the federal government, by every person who's a "principal" of every
small US for-profit corporation:

  https://papersplease.org/wp/2025/02/24/supreme-court-reinstates-new-requirement-for-ids-and-mug-shots-of-corporate-principals/

That was so unpopular, and so widely ignored, that the agency now says
they aren't enforcing it.  Except on certain companies that they don't
identify publicly.  Know Your Customer And Tell Us, but you can't know
what the law requires, seems to be their practice.

  https://papersplease.org/wp/2025/03/03/treasury-department-says-it-wont-enforce-id-requirement-for-corporate-principals/

	John