Ron Paul Dear Colleague on Know Your Customer as Deviations of Procedure
Ron Paul Dear Colleague on Know Your Customer as Deviations of Procedure
January 28, 1999
(J. Bradley Jansen was Ron Paul’s legislative staffer for these issues at the time)
“slight deviations from legal modes of procedure”
January 28, 1999
Dear Colleague,
Apologists for the proposed “Know Your Customer” financial regulation arrogantly chastise that it merely “formalizes existing policies” or “barely changes current procedure.” They are wrong: CURRENT LAW AND REGULATION DO NOT REQUIRE THE MANDATORY REPORTING OF THE SOURCE OF FUNDS FOR ALL FINANCIAL TRANSACTIONS. More than a century ago, the Supreme Court warned of the manner in which illegitimate and unconstitutional practices become accepted. The Know Your Customer proposal builds on the illegitimate practices of the Bank Secrecy Act, just as the contemporary critics warned:
“As this Court settled long ago in Boyd v. United States, 116 U.S. 616, 622 (1886), ‘a compulsory production of a man’s private papers to establish a criminal charge against him . . . is within the scope of the Fourth Amendment to the Constitution . . . ‘ The acquisition of records in this case, as we said of the order to produce an invoice in Boyd, may lack the ‘aggravating incidents of actual search and seizure, such as forcible entry into a man’s house and searching amongst his papers . . .,’ ibid., but this cannot change its intrinsic character as a search and seizure. We do well to recall the admonishment in Boyd, id., at 635:
“It may be that it is the obnoxious thing in its mildest and least repulsive form; but illegitimate and unconstitutional practices get their first footing in that way, namely, by silent approaches and slight deviations from legal modes of procedure.”
First Amendment freedoms are ‘delicate and vulnerable.’ They need breathing space to survive . . More importantly, however slight may be the inhibition of First Amendment rights caused by the bank’s maintenance of the list of contributors, the crucial factor is that the Government has shown no need, compelling or otherwise, for the maintenance of such records. Surely the fact that some may use negotiable instruments for illegal purposes cannot justify the Government’s running roughshod over the First Amendment rights of the hundreds of lawful yet controversial organizations like the ACLU. Congress may well have been correct in concluding that law enforcement would be facilitated by the dragnet requirements of [the Bank Secrecy] Act. Those who wrote our Constitution, however, recognized more important values.”
Supreme Court Justice Thurgood Marshal, California Bankers Assn v. Shultz, 416 U.S. 21 (1974)
Stop the encroachment of our constitutional rights–and correct previous violations. Pass the Know Your Customer Sunset Act, the Bank Secrecy Sunset Act, the FinCEN Public Accountability Act and HR 220, the Freedom and Privacy Restoration Act. Please email or call Bradley Jansen at 5-2831.
Respectfully,
Ron Paul