From: Derrick Storren <dekkard@sprynet.com>
Date: Thu, 6 Feb 1997 11:22:31 -0800 (PST)
To: cypherpunks@toad.com
Subject: FinCEN hates cybercash, who 'da thunk it...
Message-ID: <199702061922.LAA28357@toad.com>
MIME-Version: 1.0
Content-Type: text/plain


Big brother, Morris, at FinCEN sees a criminal behind every cyber
dollar.  The sky is falling, the sky is falling, it's raining cyber
cash!

Artilce follows :)
******************

=09=09_G7 groups frets over electronic money laundering_

Copyright =A9 1997 Nando.net
Copyright =A9 1997 Agence France-Presse=20

PARIS (Feb 6, 1997 11:30 a.m. EST) - Money-laundering fighters from key
industrial countries and leading
Asian financial centers are looking into ways of countering use of the
Internet and "smart cards" to clear
proceeds from criminal activities, officials said Thursday.

The Financial Action Task Force (FATF), set up following a Group of
Seven initiative at their l989 summit, called
in a lengthy report for closer cooperation and coordinated efforts to
fight money laundering, especially in
regard to new electronic payments technologies.

The report noted that these technologies were still "in their infancy"
and said it was "premature to consider
prescriptive solutions to theoretical problems."

But Stanley Morris of the United States Treasury, who chaired a FAFT
working group which drafted the report,
told a news conference that law enforcement agencies would face 'very
major new challenges' if new
technology moves the world "to a cashless society, beyond banks, cash
and borders."

He said the group's meeting, held in Paris last November, was the first
time an international organization has
examined "the implications of e-money - electronic money - or cyber
payments."

The group had for the first time examined "not only criminal activity as
we see it" at present, but "what kind of
crominal activites might occur as we approach the new payments
technologies relying on the revolution in
microchips and .. changes in payments services generally."

Morris, who heads the U.S. Treasury's Financial Crimes Enforcement
Network (FinCEN), said cash had
become "a significant problem" for criminal groups, which find it
increasingly difficult to channel their criminal
proceeds into the banking system, at least in FATF countries.

"We find a clear move away from direct dealing with banks to non-bank
institutions, including bureaux de
change money order sellers, and even professional services like lawyers
and accountants," he said.

The group had also seen "the realities of economic globalization," he
said, adding that financial activities are
"poorly controlled by the nation states."

Morris said the working group had therefore invited representatives of
the high technology industry now
working on the new payments technology which was still "in the prototype
stage" without any clear indication
as to the direction they might take.

"We wanted to sit down with the industry as experts on money laundering
enforcement.... to let them know now
what kinds of systems would cause us problems and give the bad guys new
opportunities," he said.

The purpose was to seek to encourage development of these technologies
"in ways that do not provide a new
forum for money laundering," he said.

The FATF was essentially a preventive business, Morris added. "We do not
measure our success simply on
arrests and (money) seizures."

FATF chairman Fernando Carpentieri, the Director General of the Italian
Treasury, said drug trafficking
remained a key source of criminal proceeds which crime groups were
seeking to "legalize."

He said the Task Force, consisting mainly of OECD member countries, as
well as Hongkong, Singapore, the
Gulf Cooperation Council and the European Commission, was not at present
considering admitting further
members to preserve its efficiency.

But it was working with the authorities of countries throughout the
world to secure the broadest possible
implementation of the anti-money laundering measures it has
recommended.> G7 groups frets over electronic money laundering