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0 pointsakira25011y ago0 comments

Is there some reason my bank needs this information in the first place? I want them to verify that I am the owner of the account, I do NOT need them to verify my precise federal identity.

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acdha1y ago

They are legally required to know your identity and, I believe, report interest to the IRS. If they don’t check your government ID, they’ll be popular with organized crime.

Now, I’m sure banks also love that for data mining purposes but it’s not entirely without a valid reason.

akira2501OP1y ago

This is so the IRS can keep track of the $15.40 of interest I earned on savings?

What mechanism causes KYC/ID checks to make banks unusable to organized crime? What purpose was organized crime using banks for? Is the government unable to get search warrants for bank accounts?

These are probably not what most people would consider valid reasons. The problems created outweigh the value of the solution.

zamadatix1y ago

They're less interested in things like verifying your couple dollars of interest and more interested in things like money laundering and identifying assets to seize. Particularly setting money limits leads to what is known as "smurfing" to try to hide the activity. Not that I'm saying you must therefore consider these reasons good enough but throwing out strawment like a couple dollars interest is not highlighting what you'd like it to.

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