from Hacker News

Anti-money laundering: the least effective policy experiment?

by thinkmassive on 5/18/24, 8:21 PM with 4 comments

  • by upon_drumhead on 5/19/24, 2:51 AM

    At this point the ineffectiveness is a feature. It's a huge source of domestic intelligence on citizens.

  • by csomar on 5/19/24, 2:52 AM

    I am of the opinion that AML/KYC are purely political. They are a useful tool outside the legal and judicial framework. Want to freeze someone bank account? Gov. used to need to go to court for that, now you just need to inform the bank about potential suspicious activity. No legal process. Want to reduce outflows to China or some other countries you don't like? Yep, make every wire to that country "suspicious" and in need of further and stricter KYC.

    Plus, now you have your obedient citizens giving you all these information about beneficial ownership, transactions information, etc... could always use that to tax more.

    > In Europe, the anti-money laundering movement apparently makes private businesses spend as much as €144 billion in compliance costs to help authorities confiscate up to €1.2 billion of more than €110 billion generated by criminals each year. This suggests a higher recovery rate, at 1.1 percent, but for reasons outlined above may be overstated, and offset by compliance costs 120 times the amount successfully recovered from criminals. (Bizarrely, by these estimates, compliance costs exceed total criminal funds).

    With this being a "hundred billions" (mainly consulting) industry, good luck getting rid of it the easy way. There will be billions in lobbying to not remove AML/KYC anytime soon.

  • by gjsman-1000 on 5/19/24, 2:40 AM

    I’m opposed to AML for the obvious intense privacy invasions which followed the implementation, in addition to questions regarding who actually owns that money. Have you ever tried to withdraw $10K from a bank? In many countries, if you can’t provide a reason to the bank’s satisfaction, the bank will deny the attempt.

    What if I just want to stash some money under my bed so I’m not SVBed? Perfectly legal - it’s my money - and in some countries, good luck with that “excuse.”

  • by kelthuzad on 5/19/24, 2:47 AM

    "It finds that the anti-money laundering policy intervention has less than 0.1 percent impact on criminal finances, compliance costs exceed recovered criminal funds more than a hundred times over, and banks, taxpayers and ordinary citizens are penalized more than criminal enterprises."