Schneier on Paying Off Your Credit Card Balance
Bruce Schneier blogs about the Rhode Island man who
alleges that his recent $6,522 payment to his JCPenney Platinum
MasterCard was reported to the Department of Homeland Security because
this payment was "a certain percentage higher" than his normal payment.
I discussed this last week
Schneier's article is a mixture of good and bad, mostly good.
Unlike the original article reporting this, he manages to get the name
of the applicable law correct: the Bank Secrecy Act. He has pointers
to the way the legislation was amended by the Patriot Act.
He has pointers to a couple of excellent debunking
posts by Seth Finkelstein, which I'll relink: here
One of the commenters makes the observation that none of the statutes
and regulations Schneier links to in his article have anything to
do with the claimed facts; as near as I can tell, that's correct.
There's more than enough reason to be extremely skeptical
of the report.
Unfortunately, Schneier still feels that it's necessary to carp:
… certainly this kind of thing is what financial institutions are required
to report under the Patriot Act.
Remember, all the time spent chasing down silly false alarms is time
wasted. Finding terrorist plots is a signal-to-noise problem, and stuff
like this substantially decreases that ratio: it adds a lot of noise
without adding enough signal. It makes us less safe, because it makes
terrorist plots harder to find.
Which neatly ignores:
- The Bank Secrecy Act has been around since 1970.
- The ACLU griped
about this back in 1990:
The ACLU said that it was only seven years ago that Congress amended the
Bank Secrecy Act to require that banks file so-called "suspicious
activity" reports, which banks must file whenever a transaction of
$5,000 or more is carried out by a customer.
Again, note carefully: the ACLU is talking in 1990
about a seven-year-old amendment to the BSA. Well
before the Patriot Act.
- It's far from clear that this case (assuming that
it happened at all) was a "terrorism" investigation;
as Finkelstein points out, Homeland Security does criminal credit
card fraud investigations as well, and it's very probable that
this happened under that umbrella.
By pointing to terrorism and the Patriot Act, Schneier is almost
certainly doing some "chasing down" of "silly false alarms" of
his own. Again: if you want to raise the bar for reporting of
financial transactions to law enforcement agencies, that's fine by
me. But saying it's all due to the Patriot Act and terrorism
investigators gone wild is just wrong and lazy.
For a much, much worse example, see the recent Slashdot
article, which (unsurprisingly) is completely unskeptical of the
original report; the light/heat ratio of the hundreds of comments
is also quite low. (Maybe zero. Didn't read 'em all.)
2006-03-07 5:00 PM EST
Last Modified 2006-10-12 11:28 AM EDT