Gold sales to be registered by Brokers

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I  had barely finished the previous CENTAPEDE about reporting
transactions for the purpose of money laundering transactions One
thing I did not mention is that a series of transactions that
exceeds $10,000 will also have to be reported if it looks like
one is trying to "accumulate" money or assets over the $10,000
threshold  .
What this means is that if you are a snowbird and send yourself
$2,500 at the start of every month for five months while you are
sojourning in Arizona or California or Florida and spend it down
during the month for rent, gas, etc., it would not be suspicious
bur if you received $2,500 every five days until there was
$15,000 in the account, the bank or credit union or savings and
loan or mutual fund dealer would have to report it on a US form
4789 or a E667 in Canada.
However, the following article arrived by email as I was writing
the previous email. Canadian Regulations cannot be far behind.
Credit for this goes to Jon Christian Ryter a right wing writer
in the US.
    http://www.jonchristianryter.com/
BANK SECRECY ACT:
GOLD BROKERS WILL BE FORCED TO REGISTER GOLD SALES
By Jon Christian Ryter
January 12, 2004
NewsWithViews.com
Within two months gold brokers and jewelers in the United States
will fall under the purview of the Bank Secrecy Act of 2001 and
will be required to report to the Treasury Department's Financial
Crimes Enforcement Network [FinCEN] any time one of their
customers buys $50,000 in gold or precious stones, or spends more
than $10,000 in cash.
The twist in this regulation comes from Section 103.23 of the
Bank Secrecy Act that forces gold brokers and jewelers to
construe that separate purchases over a period of several days or
weeks are, in fact, one purchase in the eyes of FinCEN. What was
going to happen in late February or March, 2004 began to surface
as a cyber-rumor in late November. By the middle of December the
Internet was flooded with unsubstantiated rumors that gold
confiscation was around the corner. A mid-level Treasury official
addressing a jewelers' convention in November mentioned that the
Treasury Department was writing the regulations that would
enforce Section 359 of the USA Patriot Act, commonly known as the
Bank Secrecy Act. The conspiracy dam ruptured, and the
cyber-flood began. Only this time, the rumors were largely true
with respect to a registry being created for gold brokers and
diamond and precious stone merchants and their most profitable
clients.
The Bank Secrecy Act of 2001 was written by the same FDIC and Fed
officials who created the privacy intrusion regulations in 1998
that were innocuously promoted to the American people as a bank
"service" referred to as "Know Your Customer." On the heels of
the repudiation of "Know Your Customer" by America's financial
institutions and privacy rights groups, Congress made two
attempts--one in 1999 and another in 2000--to enact the Clinton
Administration's proffered money laundering legislation that
would have expanded law enforcement's access to personal
information about your financial transactions (if there was
sufficient grounds to suspect you might be engaged in some sort
of unlawful activity due to the size of either the withdrawals
from, or deposits into, your account at a bank, savings and loan,
credit union or brokerage house). After HR 3886, The
International Counter-Money Laundering Act of 2000 died on the
vine, it would be September 11, 2001 before the American people
would be frightened enough to blindly sacrifice a little bit more
of their constitutional privacy for what they erroneously
believed would be a safer America. On October 27, 2001 the Bank
Secrecy Act piggybacked its way to passage as Section 359 of
Public Law 107-56--the Uniting and Strengthening America by
Providing Appropriate Tools Required To Intercept and Destruct
Terrorism (USA Patriot Act of 2001).
Taking its time, the Paul O'Neill Treasury Department did not
submit its draft outline of its proposed regulations and
enforcement guidelines to the House and Senate Banking Committees
for their purview until November, 2002. Dr. Ron Paul [R-14th-TX],
the vice-chairman of the House Financial Services Committee,
dashed off an angry e-mail to then Treasury Secretary O'Neill in
which he said: "I am writing to express my concerns regarding the
Financial Crime Enforcement Network (FINCEN)'s proposed new
regulations implementing the USA Patriot Act's amendments to the
Bank Secrecy Act [of 1970]. When they are implemented, these
regulations will violate the constitutional rights of law-abiding
citizens who purchase precious metals and hinder law-enforcement
efforts to identify and apprehend terrorists."
"Under the rule," Congressman Paul continued, "dealers in
precious metals who purchase or receive more than $50,000 in
jewels, precious metals, precious stones, or jewelry are required
to adopt an anti-money laundering program. The program must
include the adoption of 'know your customer' type procedures. In
addition, the dealers will also be required to report receipts of
over $10,000 in cash."
When Congress enacted the Bank Secrecy Act, it required the
Treasury Department to report within one year the need for any
additional legislation to fully implement the money-laundering
aspects of the Act. The Treasury Department made an additional
request on September 26, 2002. They asked that a provision be
added to the law, Section 103.23 that said: "...a person who
transports, mails, ships, or receives; is about to, or attempts
to transport, mail, ship; or causes the transportation, mailing,
shipment or receipt of monetary instruments, is deemed to do so
'at one time' if...that transaction totals more than $10,000..."
(and/or if) "...[shipment or delivery is spread out over one or
more days] "...for the purpose of evading the reporting
requirements..." is guilty of violating the law and is subject to
its penalties which includes fines and imprisonment.
"Know your customer procedures" Paul continued, "require dealers
to develop a profile of a typical money launderer. The profile is
based on a list of legal transactions, which federal bureaucrats
have determined are often engaged in by money launderers. Dealers
are required to file a suspicious activity report whenever one of
their customers matches that profile.
"Far from being the type of effective and focused program
necessary to identify terrorists," the Texas Republicans said,
"the 'know your customer' approach forces the government to look
for needles in a haystack. This is because financial institutions
file these reports regardless of whether they have any real
evidence of criminal activity. For example, according to
information obtained by my office, 99.999% of all Currency
Transaction Reports are filed on law-abiding citizens. Aside from
raising serious concerns about the government's respect for
individual privacy, a system with this amount of "false
positives" diverts valuable law enforcement resources away from
the investigation of real terrorist threats to the harassment of
innocent citizens.
"Furthermore," Paul said, "at a time when the economy is, at
best, recovering from recession, I question the wisdom of
imposing costly new reporting and record-keeping regulations on
small businesses. Most jewelers and precious metal businesses are
small 'mom-and-pop' operations that cannot easily afford to
comply with burdensome record-keeping regulations. Many small
dealers, in order to provide absolute proof that they are not
dealing with terrorists, drug dealers, or other black marketers,
will keep a database of all customers to share with the
government. Thus, this regulation establishes a de facto database
of every precious metals customer in the nation. Such a database
would have great potential for abuse if a future administration
decided to engage in another mass confiscation of gold, similar
to the one that occurred under the Roosevelt Administration in
the 1930s.
"Concerns over the loss of privacy," Paul noted, "are going to
drive legitimate gold customers into the black market.
Ironically, by expanding the illegitimate market for gold, these
regulations will enhance the ability of international terrorists
to use the precious metals market as a haven for money laundering
while decreasing the ability of law enforcement officials to
apprehend terrorists. Treating all precious metal customers as
'guilty until proven innocent' turns the fourth amendment on its
head. Quite simply, the federal government lacks any
constitutional authority to snoop on the transactions of
law-abiding gold dealers and customers absent evidence that the
proceeds are being used for money laundering. In conclusion, the
proposed regulation expanding the money laundering provisions of
the Patriot Act to jewelers and precious metals dealers will
further bury law enforcement officers in false positive
Suspicious Activities and Currency Transactions Reports, thus
hindering efforts to identify and apprehend terrorists. This
regulation will also burden small gold dealers and jewelers with
new paperwork requirements, expanding the black market for
precious metals and turning every law abiding gold coin collector
into a criminal suspect. Therefore, I urge the Treasury
Department to withdraw this regulation."
Ron Paul's e-mail fell on deaf ears. According to a source on
Capitol Hill, John Snow's Treasury Department is hurriedly
writing the regulations that will implement Big Brother's
unconstitutional Section 359 of Public Law 107-56. The Treasury
official confirmed that within two months the regulations will be
codified and FinCEN will be prepared to enforce them.
Congressman Paul noted that "...financial institutions file these
reports regardless of whether they have any real evidence of
criminal activity...99.999% of all Currency Transaction Reports
are filed on law-abiding citizens. Aside from raising serious
concerns about the government's respect for individual privacy, a
system with this amount of 'false positives' diverts valuable law
enforcement resources away from the investigation of real
terrorist threats to the harassment of innocent citizens."
After the passage of the USA Patriot Act, most States enacted
enabling legislation that coincided with the terms and
restrictions of that legislation. Within the USA Patriot Act was
an amendment to the Currency and Foreign Transactions Reporting
Act (31 USC Section 5311) which, like the Bank Secrecy Act could
never have withstood scrutiny as a self-standing piece of
legislation. The State of New York's enabling legislation amended
that State's Official Compilation of Codes, Rules and
Regulations, in particular, Title 3, Part 300.1(c) of the Banking
Law Section 651-b, Part 406.3(g).dealing with suspicious
activities reports and currency transactions reports. The State
of New York decided to test that provision of the law and charged
Western Union, which is the world's largest electronic
transporter of small sums of unregulated money, with violating
Part 300 of Title Three of the New York Banking Law dealing with
currency transactions.
Stunned, but defenseless because Western Union did not construe
the minuscule wire transfers from low income American
wage-earners to pay overdue bills--or wire transfers from mom and
pop to their children--came under the purview of suspicious wire
transfer activity, the telecommunications giant bowed to the
mighty State and agreed to pay a fine of $8 million for violating
the Currency and Foreign Transactions Reporting Act.
Just as the United States government created the bootleg industry
and the criminal activity associated with it by banning the
manufacture or sale of alcoholic beverages, our government, by
attempting to register the buying and selling of gold and
precious stones by working class Americans, will inadvertently
create am underground black market for gold and precious stones
of sufficient size and financial strength that it will become a
viable conduit for terrorists to transfer assets that can be used
to purchase explosives or even human suicide bombers.
Uncle Sam seems determined to relive history. In 1933 the Federal
Reserve, with the assistance of Franklin D. Roosevelt's Treasury
Secretary William Woodin, wrote the Banking Emergency Relief Act
of March 9,1933 that gave a fuzzy but nevertheless
unconstitutional sense of legality to Roosevelt's seizure of the
gold that had been lawfully withdrawn from the nation's banks by
its owners. Three days earlier, on March 6, 1933--within minutes
of his inauguration--FDR issued Proclamation 2039, closing
America's banks. On March 8 Roosevelt extended the bank holiday.
On that same day, the Federal Reserve ordered all banks in the
United States to prepare a list, to be delivered to the Treasurer
of the United States, of any depositor who had withdrawn their
savings in gold from the nation's banks and savings and loan
companies. The Fed also instructed the banks to create a second
list of those citizens who failed to redeposit that gold by March
13. Those Americans would be subject to a fine of not more than
$10,000 nor imprisonment for more than ten years for "hoarding"
their own life savings.
It is for precisely that reason that Americans who heard the
rumors of another "gold registration" in November reacted with
alarm. It is also the reason that wary, mistrustful American
citizens will very likely risk fines and imprisonment to support
an illegal underground gold market. And, it will likely be for
the same reason that the U.S. government, convinced that
terrorists are moving monetary assets around the country, and the
world, in the form of portable wealth rather than traceable
currency, they will make a move not only to outlaw the private
ownership of gold, but to also ban the sale of loose diamonds and
precious stones as well to unlicensed dealers.
When that happens, FDR's New Deal will come full circle to meet
George W. Bush's Raw Deal just about at election time.
© 2004 Jon Christian Ryter - All Rights Reserved
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