OT: "Know Your Customer" Saga Continues

greenspun.com : LUSENET : TimeBomb 2000 (Y2000) : One Thread

Someone just emailed me the URL of www.defendyourprivacy.com, which I found interesting.

As a result of Y2K, I have become somewhat curious of other "controversial" topics. I'm a bit of a newbie though, so if you have anything hot [Y2K-related or not] you'd like to send me, you can do so anonymously on my Sound Off Page.


Snipped from the FAQ page:

What has the public response been?

Overwhelmingly opposed to "Know Your Customer". The FDIC received over 250,000 public comments on "Know Your Customer" by the March 8th deadline -- and all but 72 were opposed to it. In the face of overwhelming opposition from the American people, the FDIC withdrew its proposed rule on March 23, 1999.

Does that mean that Know Your Customer is dead?

Absolutely not. The Federal Reserve's "Bank Secrecy Act Compliance Manual" effectively requires banks to implement Know Your Customer programs even without the FDIC rule. In fact, over 88% of banks reported in a recent survey by the American Bankers Association that they already have Know Your Customer policies in place. According to Assistant Director of the Federal Reserve Richard Small, Know Your Customer is not dead, but needs to be "repackaged".

-- Zach Anderson (z@figure.8m.com), November 08, 1999


We need a wooden stake to drive thru this vampire's heart.

-- Mr. Mike (mikeabn@aol.com), November 08, 1999.

But will it play in Peoria?

Banks preparing tellers for withdrawal onslaught Tellers are told to remind customers to `remain calm4 about Y2K worries

Source: Peoria Journal Star

Planning to make a large cash withdrawal from Cohoes Savings Bank before New Year's Eve? You'll most likely get an earful before you get your money.

The bank is one of hundreds that has made tellers the last defense against people emptying their bank accounts due to the Y2K computer problem.

When tellers notice such activities, they've been taught to reassure the customer about the bank's Y2K compliance -- and to try to persuade them to leave their money where it is.

At Cohoes Savings, for instance, a large cash withdrawal could prompt a teller to casually inquire, "Is this for a purchase?" If it isn't, said president and CEO Harry Robinson, counseling will follow.

No bank can stop you from taking out your own money.

In the past few months, education has been a big part of banks' Y2K work. Customers received Y2K readiness pamphlets with their monthly statements and see the reassuring Y2K posters in bank lobbies.

If such efforts don't work, the tellers will do the rest.

"Most of our customers are not real worried about it," said Debbie Roylance, a teller at Cohoes.

"The ones that are, we just basically just tell them: `Remain calm.4 "

Banks are required to inform the Internal Revenue Service if a customer takes out more than $10,000 in cash from their account.

But sometimes even smaller withdrawals are enough to raise the eyebrow of a teller, prompting an inquiry.

Jane Cordts, vice president of Troy Savings Bank, said the bank has always asked its tellers to watch out for suspicious withdrawals, especially among elderly people who may be vulnerable to scams.

The bank will give tellers an attentiveness refresher course soon.

"If something looks a little out of the ordinary, that's when the red flags should be waved," added Samuel Capuano, vice president and Y2K coordinator at Ballston Spa National Bank, a place where the operator answers the phone with "Ballston Spa National Bank, we're Y2K ready." Y2K is, as nearly everyone knows by now, the problem some computers have in dealing with the year change from 1999 to 2000.

Americans would be hard-pressed to find an industry more prepared than banks.

Strict government oversight demands banks report their Y2K work regularly. And even if there were a Y2K problem, all records are backed up on hard copy, and the cash itself would still be in the vault. Banks even have plans to open if the power goes out.

Furthermore, as banks are so happy to point out, individual accounts are insured by the Federal Deposit Insurance Corporation up to $100,000 per person. Some Y2K worriers have feared so many people will rush the banks before New Year's Eve that the country could run out of cash.

That's not likely, says the Federal Reserve Board -- there's currently $200 billion in circulation, with another $200 billion in reserve vaults.

Banks say their biggest worry is that their customers will take out money and then lose it to a fire, burglar or scam artist.

Bank officials say if they find out customers are taking out money because of Y2K, they often suggest alternatives, such as traveler's checks, a cashier's check or a safe deposit box.

Publication date: Oct 31, 1999

) 1999, NewsReal, Inc.

-- not now (I@justdont.know), November 08, 1999.

There go the banks scamming their depositors.

-- Spank Bank (nomoney@there.rollover), November 08, 1999.

Excuse my denseness, but how does a safety deposit box benefit anyone in this instance?

-- Tin(foil) Lizzie (par@noia.asylum), November 08, 1999.

You can use another banks safety deposit box to stash your cash, or if you are intrepid at heart, you can use the bank where you have your accounts to rent a safety deposit box there. You withdraw some amount of cash, then go to the other bank and make the deposit into your box, privately, of course.

So, as long as the bank's doors stay open, you can always get to the "important papers" inside of your own box in the vault. Only one problem: The cash in your safety deposit box are NOT insured by FDIC, like an account is (although there is some doubt about that). In Seattle, the safe deposit box vault was broken into in the middle of the night, and all the boxes were opened and emptied. Those folks were SOL.

-- (formerly known as nobody@nowhere.ner), November 08, 1999.

I know this sounds odd, but I recall having read somewhere that it isn't legal to keep cash in a safe deposit box. I don't know how reliable the source was, so I'm not stating that that is the case. Mostly bringing it up to see if anyone else knows whether that's true or not.

-- (ithinkireadit@this.forum), November 09, 1999.

From: Y2K, ` la Carte by Dancr (pic), near Monterey, California

Banks say their biggest worry is that their customers will take out money and then lose it to a fire, burglar or scam artist.

Does this pass the smell test?

-- Dancr (addy.available@my.webpage), November 10, 1999.

Moderation questions? read the FAQ