From: hallam@w3.org
Date: Wed, 25 Oct 95 09:30:04 PDT
To: cypherpunks@toad.com
Subject: Re: Mark Twain Bank (was: Anonymity: A Modest Proposal)
In-Reply-To: <199510250551.WAA29912@netcom12.netcom.com>
Message-ID: <9510251629.AA11820@zorch.w3.org>
MIME-Version: 1.0
Content-Type: text/plain



>1.  Both parties stipulate that their relationship is a 
>    business relationship and not a fiduciary relationship.

Perhaps someone with US legal experience might care to comment 
on the enforceability of such a clause. Surely the nature of
the relationship is defined by its character and not soley by 
a contract disclaimer.

>2.  Your account is not FDIC insured. 

Good luck then!

>3.  The bank accepts no liability for anything going wrong, 
>    although it may, at its sole option, attempt to make
>    ammends.

Wouldn't it be convenient if such clauses were enforcable?

>4.  Parties agree to wave a jury trial.
>
>5.  Parties agree to binding arbitration. 

These seem pretty dangerous to me if enforcable. They would 
effectively usurp the power of the courts as arbiter. Although
I have less confidence in the competence of a jury than that
of judges I'm pretty sure that the UK courts would consider
such contract clauses in a dim light.

>6.  General waffling to the effect that the tiny fees collected
>    imply an equally tiny responsiblity and potential liability
>    on the part of the bank.  

Hmm, wana bet?


This is not a commercial contract between buisnesses it is clearly 
offering a consumer service. It is not the result of informed
negotiation between sides armed with lawyers, it is a very one sided
contract. This brings up a major problem with Chaum's schemes,
there has to be trust in the financial institution. Contracts such
as this do not inspire confidence. Mark Twain bank have a
confidence problem in any case, when I mentioned their name
as DigiCash licensees to an audience yesterday they laughed.

>One wonders whether signing away all responsibilty on the part of
>the bank is going to be the standard for using digital money
>on the Internet, or whether consumers will demand protection
>when using these new services.  

Consumers have votes, they are not afraid of regulation. Forget
the pap you see spouted by politicians about deregulation, they
simply mean remove the regulations that negatively affect our 
interests, their supporters are likewise. 

It is ironic that the Credit card cos biggest advantage in 
cyberspace and other mail order turns out to be the $50 limit 
on consumer exposure to loss. This is another side of regulation
E that people don't mention so often.

Lets wait a while and see how long it takes for the Fed to ring
up "dear boy, we have a few questions....".


		Phill