From: Black Unicorn <unicorn@schloss.li>
Date: Tue, 8 Oct 1996 14:04:01 +0800
To: John Young <jya@pipeline.com>
Subject: EUB - Pay attention next time guys.
In-Reply-To: <1.5.4.16.19961007141311.38278e72@pop.pipeline.com>
Message-ID: <Pine.SUN.3.94.961007163406.9806B-100000@polaris>
MIME-Version: 1.0
Content-Type: text/plain


On Mon, 7 Oct 1996, John Young wrote:

>    10-7-96. WaPo:
> 
>    "Russian Crime Finds Havens In Caribbean"
> 
>       Russian organized crime groups are using unregulated and
>       secretive Caribbean banks to launder their illicit
>       gains, according to U.S. and Caribbean law enforcement
>       officials. One bank that has drawn the scrutiny of U.S.
>       authorities is European Union Bank in Antigua. EUB
>       describes itself as the first bank on the Internet,
>       offering the chance to open accounts, wire money, order
>       credit cards or write checks by computer from anywhere
>       in the world, 24 hours a day. A U.S. official said, "The
>       bank is being investigated for violating U.S. laws with
>       open solicitations on the Net, which is at best for tax
>       evasion and at worst for money laundering."
> 

Of course I'm very interested to hear exactly what laws have been broken
in this case.  Last I checked offering accounts, credit cards, and checks
24 hours a day was a selling point, not a crime.  This hardly surprises me
however.  The money laundering and tax evasion rhetoric is dragged out
whenever there is no tangible crime being committed.

EUB is probably in more trouble than they realize because they chose an
interesting solution to their bandwidth problem. 

For a long time their home page resolved to a U.S. access provider, and
only forwarded offshore for the secure HTTP connection.  This might still
be the case.

See below:

European Union Bank (EUB-DOM)
   PO Box 1948
   St. John's,
   Antigua and Barbuda

   Domain Name: EUB.COM

   Administrative Contact:
      Richards, Pete  (PR374)  75057.2515@COMPUSERVE.COM
      (809) 480-2370
   Technical Contact, Zone Contact, Billing Contact:
      Kulkov, Val  (VK41)  val@GREATIS.COM
      (202) 835-7489

   Record last updated on 03-Dec-95.
   Record created on 23-Jun-95.

   Domain servers in listed order:

   ELF.GREATIS.COM              205.229.28.5
   WHALE.GREATIS.COM            205.229.28.10


I found this curious and called them up to ask them about it.  I think,
though I don't remember exactly, that I spoke with Mr. Richards.  Whoever
it was, they were very sure that their U.S. connection would not be a
problem.  I think they are about to be in for a great big surprise.  They
have effectively put themselves in U.S. jurisdiction and their local
access provider is likely to be in some trouble as it is the easiest thing
to reach.

Prediction: EUB will change its structure dramatically in the next 6
months if it still exists at all in that time.  Lesson learned: Never
involve the United States directly.  Clever political risk analysis would
have prevented a great deal of trouble for EUB.  Future institutions take
note.

--
I hate lightning - finger for public key - Vote Monarchist
unicorn@schloss.li