-Caveat Lector- from: http://www.wired.com/news/news/politics/story/20498.html <A HREF="http://www.wired.com/news/news/politics/story/20498.html">Political News from Wired News </A> ----- How to Reconcile Bank Privacy by Declan McCullagh 3:00 a.m. 30.Jun.99.PDT WASHINGTON -- The US House of Representatives is set to debate as early as Thursday sweeping privacy legislation that would sharply curtail what customer information banks will share with law enforcement authorities and business partners. Federal laws requiring banks to report any "suspicious transactions" to a massive IRS computer would become more precise, and the rules requiring that banks report deposits or withdrawals of more than US$10,000 would in the future apply to amounts greater than $25,000. A separate proposal, backed largely by Democrats, would increase federal regulation of the financial industry by requiring that banks let customers choose whether their data may be shared with affiliated brokerage and insurance firms. ------------------------------------------------------------------------ See also: Know Your (Customer) Rights ------------------------------------------------------------------------ Both are amendments that proponents finalized Tuesday and hope to attach to a mammoth banking modernization plan called the Financial Services Act of 1999. One obstacle looms: The House Rules Committee. The panel is scheduled to meet Wednesday to decide what amendments may be offered to the bill before the vote by the full House. Representative Ron Paul (R-Texas), who has long tried to reduce the flow of customer information to the government, predicts he will prevail in a floor vote. That is, as long as the powerful Rules Committee lets him attempt one. "I know what would happen if Congress had to vote on this," said Paul, who led the fight against the "Know Your Customer" bill. "This is one issue that has been thoroughly explained to the American people and every Congressman is aware of it. We'd win overwhelmingly." Joining Paul are Representatives Bob Barr (R-Georgia) and Tom Campbell (R-California). Their amendment requires banks to forward reports to the Feds only when employees believe that there is a "transaction relevant to a possible violation of a law or regulation." It would also make their victory against the Know Your Customer plan permanent by barring the Feds from making banks "determine the sources of funds" deposited by customers or requiring similar forms of surveillance. When a bank detects suspicious activity, current regulations require it to complete a five-page report that includes the customer's name, address, Social Security number, drivers license or passport number, date of birth, and information about the transaction. The bank then sends the information to a computing center in Detroit, where it becomes part of the Suspicious Activity Reporting System, a mammoth database jointly administered by the IRS and FinCEN, which went online in 1996. Paul proposed an even more extensive reform package when the bill was in committee, but it was rejected in favor of the one backed by Barr. Paul and Barr have since reconciled their differences. "I thought maybe he didn't like my stronger approach, but now he does and he supports going all the way," Paul said. Law enforcement agencies and their supporters in Congress -- who have previously said bank surveillance was a key weapon in the war on illegal drugs -- are expected to oppose the measure. The other amendment, championed by Representative Ed Markey (D-Massachusetts), would increase the role of the federal government in regulating companies' data-sharing practices. The two approaches to protecting privacy -- increasing versus reducing government regulation -- stem from markedly different views about the role of government. Markey is a liberal Democrat, while Barr is a conservative Republican and Paul is an ardent free-market proponent. Paul said he would oppose Markey's plan, but civil libertarians endorse both. "Congress has a golden opportunity to either protect financial privacy rights or threaten financial privacy," said Greg Nojeim, legislative counsel for the American Civil Liberties Union. "Customers have a right to control information about their most personal financial transactions from disclosure to both the government and affiliates of their bank." On Tuesday, Markey received unexpected support from a Republican, Representative Joe Barton of Texas. One source on the Hill said late Tuesday that prominent Democrat John Conyers of Michigan would support the Paul-Barr-Campbell proposal. But trade associations representing the banking industry have strongly opposed Markey's proposal and many observers predict the Rules Committee is not likely to let him offer it. << Back 2 of 2 Have a comment on this article? Send it. Send us feedback | Work at Wired Digital | Advertise with us About Wired Digital | Our Privacy Policy Copyright © 1994-99 Wired Digital Inc. All rights reserved. ----- Aloha, He'Ping, Om, Shalom, Salaam. Em Hotep, Peace Be, Omnia Bona Bonis, All My Relations. Adieu, Adios, Aloha. Amen. Roads End Kris DECLARATION & DISCLAIMER ========== CTRL is a discussion and informational exchange list. Proselyzting propagandic screeds are not allowed. Substance—not soapboxing! 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