Date: Sat, 30 Jan 1999 12:02:42 -0500 (EST)
Message-Id: <199901301702.MAA29909@belmonte.ne.mediaone.net>
From: belmonte@mit.edu (Matthew Belmonte)
To: CapuanoHR8@aol.com
Subject: support Know Your Customer Sunset Act

Dear Representative Capuano:

I write as your constituent to express my opposition to the Federal Deposit
Insurance Corporation's proposal on Minimum Security Devices and Procedures and
Bank Secrecy Act Compliance, also known as the "Know Your Customer" regulation,
and to encourage you to support legislation proposed by Representative Ron Paul
that would negate the know-your-customer rule and would install further
safeguards on depositors' privacy.

I note that you're a member of the Banking and Financial Services Committee, so
it's particularly appropriate that I contact you.

As the know-your-customer proposal
("http://www.fdic.gov/lawsregs/fedr/98knocus.txt") observes, "The integrity of
the financial sector depends on the ability of banks and other financial
institutions to attract and retain legitimate funds from legitimate customers."
Since this is the case, there already is business pressure on financial
institutions to discourage illegitimate transactions - there is no need for
explicit regulation.
 
In addition, this proposed regulation would damage the relationship of trust
between a depositor and a financial institution.  If I want to withdraw any
amount of money for my own purposes, nobody but me and my bank should have any
part in the transaction.  Suppose I withdraw a large amount of money in order 
to purchase a house or a car, or in order to add to an investment account.  
Such a transaction cannot be foreseen by a monitor and thus may be flagged as
unusual.  I shouldn't have to explain myself under such circumstances.  Even
aside from that, I don't like the thought of someone electronically looking
over my shoulder in business that should be between me and my bank.

Ron Paul, your colleague on the Banking and Financial Services Committee, has
stated his intent to introduce three bills that would address the
know-your-customer rule and the bureaucratic culture that produced it.  His
"Know Your Customer Sunset Act" would block implementation of the
know-your-customer regulation.  His "Bank Secrecy Sunset Act" would repeal the
Bank Secrecy Act.  His "FinCEN Public Accountability Act" would allow citizens
access to records on them that are held by the Financial Crimes Enforcement
Network -- just as is currently the case with individuals' FBI files and credit
reports.
 
Despite its privacy clauses, the know-your-customer regulation entails a
fundamental violation of a depositor's private relationship with a financial
institution.  It would significantly sacrifice privacy in the interest of law
enforcement, and that would be un-American.  I urge you to support all three of
Representative Paul's bills, which would counteract not only the immediate
threat of this regulation but also the wider threat of the administration
that produced it.
 
Finally, I note that you have neither a Web page nor an email address at
house.gov.  I'd like to encourage you to set these up.  I voted for you this
past November and I would like to feel that I can easily communicate to you my
legislative concerns.