[HN Gopher] Seeing like a bank ___________________________________________________________________ Seeing like a bank Author : arkadiyt Score : 331 points Date : 2023-11-07 18:07 UTC (4 hours ago) (HTM) web link (www.bitsaboutmoney.com) (TXT) w3m dump (www.bitsaboutmoney.com) | DamonHD wrote: | Insightful and nicely written. I spent decades in finance | including investment banking and as a director/founder of a small | retail operation. A lot of this really rings true. | A4ET8a8uTh0 wrote: | It also managed to hit home some issues I experienced recently. | Long time ago, I was a teller/banker and I was still selling, | but the recent experience of in person account opening was just | bad ( no rate quote, disclosures thrown at the end for the sake | of compliance, and promise of a call back for an issue I raised | that I never actually got.. come to think of it ). The poor kid | did not know anything about what he was selling and that was | basic UTMA savings. | | Anyway, what I am saying is that is well worth the read; | especially the bit about constant firefighting. | csours wrote: | There is something about this that I'd like to be able to | communicate better [0]: | | Organizations are made of teams. That sounds super obvious, but | it means that any change request is going to go to a team (or | teams). | | From the outside, it looks like a corporation has effectively | unlimited resources; on the inside, any particular team has very | limited resources. The team may have just been downsized, lost a | lead, been reorganized, etc. | | 0: Better than I currently can, not better than Patrick. | | Funny quote: | | > That retail user is extremely unsophisticated about the bank | account, finance in general, and frequently many other things in | life. | pixl97 wrote: | Large organizations are made of "money saving entities". | | I work with a lot of large corporations and we have constant | problems with the software I support because the imperative is | to continually drop operational costs. We'll have a team we | work with that is well trained, understand the software well, | and keeps the software working at near 100% capacity. | | Then suddenly one day they are all gone and you get the | offshoring team that knows nothing about the specialist | software they are attempting to support, if they have the | capability to actually turn a computer on is surprising. | Software availability drops significantly having direct impact | on deliveries, costing god knows how much in some of these | companies. Support on the vendor side (my side) turns into a | huge expensive mess because now you're now writing instructions | to the level of "when you take a poopy, remember to flush and | pull your pants back up". | csours wrote: | > Large organizations are made of "money saving entities". | | Working for a cost center vs. a profit center will make a | huge difference in your professional life. | kccqzy wrote: | I simply cannot upvote this enough. | | I also believe this is a hard problem to solve. The | partitioning of an organization's resources into teams is | inherently messy and inefficient. One has to consider internal | politics, egos of middle managers, or preferences of | individuals when staffing teams within an organization. The end | result is often far from what's the best for the organization | overall. | ctoth wrote: | > You should prefer a world with credit cards and discount | brokerages to one which doesn't have them, even as you listen to | hold music occasionally. | | The problem with this is, we've known for 30 years that a system | that calls you back is better than a system you wait on hold for. | If they can't even get something this basic right, then I guess | it's good that banks will eventually, someday be software | competent, but I'll be long-since dead. | landedgentry wrote: | I am not really convinced of Patrick's framing of the | supposedly inevitable trade-offs. I've lived in other countries | with credit cards and discount brokerages, and in my opinion, | the U.S. is uniquely bad at servicing customers. | janus wrote: | It depends on where you live. In my country I would never take | a call from a bank at face value and would always expect they | give me a phone number to call back, and that better be an | institutional number. Phone fraud is rampant. | bluGill wrote: | Which in turn depends on where you live: some places a call | is not ended until both sides hang up. Fraudsters use that to | call you, give you a number and then when you call back | pretend to be answering the phone (complete with ring | noises). | | If someone like a banks calls you, you need to call back from | a different phone line, using a number that you look up | before giving private information. | | Note that most of the time the above doesn't matter, as banks | rarely need to call you to get private information. "did you | buy X" isn't private - whoever is asking already knows you | did: even if they are a scammer you have already lost - if | you didn't you need to hang up and call the bank to arrange | getting a new account now that your old one is compromised. | The only other time that matters is why you know who will | call and why (if you just applied for a mortgage you expect | the loan officer to call but you also know exactly who that | is) | rootusrootus wrote: | > a system that calls you back is better than a system you wait | on hold for | | But a lot of customers don't actually want that. An established | connection feels safer than a promise of a future connection | which may fail to happen for various reasons. | toomuchtodo wrote: | There is also no recourse when you never get called back. | Better to just leave the call on hold until a human appears. | tomjakubowski wrote: | What is the recourse if nobody picks up the hold? | krallja wrote: | Or, as has happened more times than I can count, someone | picks up and then the line goes dead? | bluGill wrote: | In both those cases you know something happened. If they | never pick up - at least you know when you gave up. If | they hang up you know and can restart. Both are bad, but | better than wondering if you are forgotten. | RationalDino wrote: | Patio11 is the best resource that I'm aware of to understand how | our institutional world works. And its biases. Over and over | again it is built in a way that incentivizes some behaviors, and | doesn't incentivize others. One behavior that is always | incentivized is that the professional and managerial classes | should always have prioritized access. | | This article walks through it in how banks work internally. Much | more painful is https://www.bitsaboutmoney.com/archive/the-waste- | stream-of-c..., which shows how rules that supposedly protect | poor people from abuse, in practice only help those with access | to the skills of the professional and managerial classes. | | I wish there was a way to summarize his point of view and explain | it to people. Part of the problem is that every system where it | happens is very complicated. And the complications are exactly | why you need professional and managerial class skills to get | priority access. | orangesite wrote: | It's absolutely great how @patio11 managed to recreate exactly | the same system within stripe despite being fully aware of it. | | (I save up my karma points precisely so I can burn them on | comments like this.) | RationalDino wrote: | I'm not sure which part you are referring to by "exactly the | same system", or to what extent patio11 is personally | responsible for it. | | However listen to his explanations of the incentives, | benefits, and downsides. Then remember that he was working | within a company that had the exact same incentives (eg same | regulatory regimes), who was going to be hiring people out of | the same financial system. And remember that there are parts | of this that he think really make the world better. | | Therefore the expected result really should be, "Somewhat | better iteration on the basic thing that everyone else does." | And so it is no surprise that it would include enough of what | you don't like that you'd see it as "exactly the same | system". | e63f67dd-065b wrote: | My impression of what he wrote is that it's an _explanation_ | of the status quo, not a denunciation of it. In his | conclusion: | | > Although it certainly doesn't feel like it to people who | hit edge cases, the tiered support model is a technology | which took us decades to popularize and which made the world | much better. It brought down the cost of financial services | and supported product innovation which would have been | impossible under the mid-century bank staffing model. We | could not have credit cards or discount brokerages without | the tiered support model. The biography of Charles Schwab | makes this point persuasively at considerable length: | competent telephone operations were instrumental to bringing | equity ownership to the middle class. You should prefer a | world with credit cards and discount brokerages to one which | doesn't have them, even as you listen to hold music | occasionally | | Tiered support is here to stay because tiered support is | _cheap_ and _resistant to the "unintelligent customer DoS" | (my words, not his)_. As he points out, you _can_ have | professional troubleshooters with the capability, authority, | and expertise to troubleshoot the problem, but their labour | costs in the hundreds of dollars an hour. | | I personally think there is a reasonable model of the world | where customers explicitly pay a hundred dollar fee to have a | highest-tier escalation to the office of the CEO/equivalent | troubleshooting team and have them take a look at your case, | but this is a model that has not yet been developed or in | wide use anywhere. | boilerupnc wrote: | I've been having a fun ride reading "QualityLand" [0] . | | In that world - those who have QualityPoints can exert far | more escalation force on all parts of their life (change | the traffic signal now for 10 units) than lower level | folks. Your comment reminds me of a world where paying fees | gets you faster and better access. Sadly - Sounds familiar. | | [0]https://www.bookbrowse.com/reviews/index.cfm/book_number | /406... | Sebguer wrote: | This sounds like effectively the same premise as | Doctorow's Down and Out in the Magic Kingdom. | orliesaurus wrote: | what he do? | archon1410 wrote: | Tangential: the lead picture in the article linked in this | comment immediately came across as AI generated, whereas the | one in OP's article did not: I had to go back and look at it | again to realise that it too is AI generated. It is quite | complex, similar to the human drawn abstract art one might find | in an Atlantic or Wired or New Yorker article, the garbled text | nearly the only thing giving it away. The article in the | comment is from August 2023, so the difference in quality | represents only a few months of progress (DALL-E 3?). | | Or maybe they're from the same source, and the author just | chose different aesthetics for the different articles. Quite | nice, in any case. | walr000s wrote: | > which shows how rules that supposedly protect poor people | from abuse, in practice only help those with access to the | skills of the professional and managerial classes. | | Maybe the world's problems and solutions are inherently too | complex for someone without those skills to have any hope of | navigating. Maybe the only real solution is to use Patrick as | an example for everyone and ask/demand that professionals spend | some amount of time advocating for people less | fortunate/educated/knowledgeable than themselves? | dcminter wrote: | "No system will ever be able to answer all interesting questions | about a user; that is formally undecidable in computer science." | What? Are they talking about the halting problem? This seems like | a stretch without defining what constitutes "interesting" in a | very weird way. | patio11 wrote: | Please accept this as a handwavy gesture at the halting problem | for an audience which has on average something like 0.2 | engineering degrees. | dcminter wrote: | So what particular banking customer data management software | do you have in mind that's adversely affected by the halting | problem? (Edit: Ha, didn't notice you were the author!) | immibis wrote: | Hello, Mr Bank Manager, I have enrolled into a game show | which will cost me half my account balance if it's even, | otherwise they will triple it and add one... | bob1029 wrote: | > Due to the deskilling of the bank branch, the people at a bank | branch, including the branch manager in many firms, can only | offer solutions to relatively straightforward problems. For the | other ones, they also have to call into a support phone tree. | Sometimes the bank will have ability to e.g. share context | between their screen and the Tier 2 rep; sometimes they're | literally incapable of proving to the bank that they work there. | | This is essentially the central value proposition of our SaaS | product - Providing less-skilled employees the ability to | accurately conduct complex account and customer management | activities in the branch environment. An "on-rails" style | application experience that more-or-less forces you to take legal | actions with the end customer. | | Our most popular workflows from the perspective of bankers are | the ones used most rarely - IRA rollovers, conversions, etc. The | ones you cannot possibly hope to memorize because they happen so | rarely. But, from a board room perspective, the focus is much | stronger on the efficiency/correctness gains for the happy-path | consumer product stacks. | | I'd say it's a dragon of a space. Borderline cursed. It took us | half a decade just to get core interfaces working well enough and | that is only like 20% of the puzzle. Documentation, regulations, | back office processes, etc are way more important and involve | super nasty conversations with people who might sense that you | are trying to replace them. | lainga wrote: | I found the article answered most of the questions it posed, but | this one came and went unexplained... | | > Banks aggressively partition staff based on job duties and | levels within those duties. | | Why? | orangesite wrote: | Efficiency fallacy. | | "We can generate more throughput in the system as a whole by | negatively incentivizing each component to work itself to | death." | | See Goldratt, Eli. | adolph wrote: | One phrase that comes up is "segregation of duties" meaning | things like "if one person can do X and Y then they can commit | fraud without being caught." So the principle of "segregation | of duties" means that the people who can do X are on different | teams than those who can do Y. | immibis wrote: | It doesn't only happen at banks, though. | NovemberWhiskey wrote: | Like, specifically: please don't let your operations people | in books and records have access to your treasury and | reconciliation systems. Or, don't let front-office people | have access to middle-office systems. See: Leeson, Nick; | Kerviel, Jerome. | aidenn0 wrote: | > I watched senior engineering leadership ask senior Ops | leadership why they had never been asked to fix them. Ops replied | that their long experience in the financial industry had taught | them that Ops never gets to use software which isn't broken and | that complaining about this is like complaining about gravity. | | I see this _everywhere_ not just at banks. A common workflow is | horribly broken with dozens of habitual workarounds and the | developer could fix it in a day if they knew about the issue. I | even see it between engineering teams when there are cross-team | dependencies. It is really hard to train people to not put up | with chronic pain in their workflows! | MichaelZuo wrote: | A lot of the times, the 'correct' workflow isn't even | documented enough to recreate it. | | Often not even enough to identify that there ever was one in | the first place. | pixl97 wrote: | I work with banks on, um issues, without disclosing too much. | Occasionally we find issues with their software workflows, and | this isn't related directly to monetary stuff. We're not | allowed to have the end result change in any way most of the | time. "But we're getting a wrong answer", or "This is costing | XX person hours per day" isn't up for consideration. Nothing | must change. | | Ugh, and on the subject of banks computer operations. Every | single department is in deep blame avoidance mode. It's not | "find and identify problems" mode, it's "It wasn't me" mode. We | had our application performance drop to almost zero (like we | dropped to disk operations per minute IOPM) I spent hours | telling the customer, this is your infrastructure. So we got | infrastructure teams on the call trying to figure out where it | was. Not a single one of them were helpful "Everything fine, | it's not us" was the first thing out of their mouths and the | second was "We didn't change anything". | | It took 10 hours of sitting on a call over 2 days to get the | NAS team to admit they turned on anti-virus on the NAS side and | that the machines were in meltdown mode because the CPU was off | the charts. The preceding people didn't even look at the | metrics before coming back with a "it's not my problem, | everything is fine" response. | rkagerer wrote: | Encountered a challenge like this once. Infrastructure team | kept telling us it wasn't anything on their end. I | coordinated with the business unit VP to serve their entire | QA environment from four VM's on my laptop for a day, and | performance went from slow as molasses, to purring like a | kitten. A couple days later their infrastructure team finally | identified storage latency issues on their multi-million | dollar cluster and let me help them fix it. | pixl97 wrote: | I swear IOPS/request latency is one of the least understood | things in these huge companies. "But we have 40bazillion GB | and 100GB LAN", cool story bro, your disk queue latency is | pegged at your depth limit and your fs response latency is | over a second, everything is going to suck till you deal | with that. | RajT88 wrote: | I have had customers say this when not getting desired | throughput cross-continent. "But the pipes! They are | fat!" Yes but also your window needs to scale... 6 figure | network engineers not knowing about window scaling, who | do not know how to analyze a packet trace. | | I recently had someone suggest that they needed 1ms | latency cross-continent. I explained patiently that the | laws of physics have to change for them to hit that | number. | | I am not even a network engineer! | NovemberWhiskey wrote: | Truth. I literally have a signal on one of my monitoring | dashboards which indicates "database is currently | undergoing online backup", because it is the single most | important performance signal I have. This doesn't come to | me as a signal from the database team; I have to poll the | database for it myself. | | Noisy neighbor in inadequately-isolated, shared-tenancy | models is just the worst. | broast wrote: | I find it very hard to tolerate teams that say an issue | isn't on them if they aren't pointing to evidence that | indicates where they think the issue is. If you think it's | not on you but it affects something within your | responsibility, you're still on the hook until you prove | it. | Scoundreller wrote: | Nothing more fun than troubleshooting a fax machine | incompatibility. | | "It's you, we're receiving faxes from everyone else" | | "It's you, everyone else is receiving our faxes" | aidenn0 wrote: | > I work with banks on, um issues, without disclosing too | much. Occasionally we find issues with their software | workflows, and this isn't related directly to monetary stuff. | We're not allowed to have the end result change in any way | most of the time. | | I think this is a good constraint in general for banks to | have, and its definitely _harder_ to change a workflow under | these constraints. | | > Every single department is in deep blame avoidance mode. | It's not "find and identify problems" mode, it's "It wasn't | me" mode. | | This tends to happen in large organizations, and is | incredibly toxic to productivity. The most extreme form is | when you get fired (or otherwise censured) for fixing | something because "You were in charge of the thing that was | causing all this trouble?!" | madeofpalk wrote: | A while back I worked at a digital media company. For | developers, the process of setting up ads for new mini sites | was a big pain and required lots of back and forth and | approvals with Ads team. I asked other developers, and they say | "This is just the process that tyhe Ads team needs". | | I go talk to the Ads people about this specifically and they | say "yeah it's a pain, but this is the way the developers need | it". | | Turns out _both_ parties had been wanting a better way which | was pretty easy (3 different page /ad placement templates), but | neither had bothered to express this to each other. | quercusa wrote: | I moved to a role supporting a team that had been told that | huge numbers of things were "impossible" by a brilliant guy | given to migraines. If you asked him on a good day, he could do | anything. But on a bad day he just wanted you out of his | office. By his demonstrated competence, they took what he said | as gospel. | | I spent an hour or two a week dragging "impossible" things out | of them and fixing them. They were very happy and ascribed | wizard-level powers to me. | rco8786 wrote: | On a previous team every eng would shadow and Ops person for a | day, once a year. We fixed so much stuff. | Terr_ wrote: | It sounds like the psychology of "Learned Helplessness" [0] | among employees and teams. | | [0] https://en.wikipedia.org/wiki/Learned_helplessness | supportengineer wrote: | Don't get me started. I've seen many cases where one PHP page | doing one occasional SQL query against one prod database, could | drive massive efficiency improvements in the organization. In a | minority of these cases, I was allowed to do such a thing. | kylehotchkiss wrote: | My very very naive take on this: why don't banks have more common | operating systems and data structures? Why is it this hard for | acquisitions to work? They're a guaranteed part of business so a | common software stack could help Chase integrate First Republic | without two parallel systems? (I welcome any responses on why | this will never happen though!) | patio11 wrote: | There is a famous joke about standards: the great thing about | common standards is that you have so many to choose from. A | corollary to it: if none of the existing common standards meets | your need, how about letting some of your senior staff get | promoted by successfully creating and popularizing a new common | standard? | mrkeen wrote: | Every problem you solve takes time away from solving other | problems, and this one is a particularly difficult coordination | problem with very little payoff. | | You might be imagining two banks coordinating together, now | scrap that and imagine ALL banks coordinating, because you | don't know which two are going to merge. | | Banks have been born at different times (think centuries - or | even millenia). So they'd all have to move in lockstep from | clay tablets to papyrus to printing press to typewriter before | they even decide whether or not they want to bet on computers | as a way forward. | | To some degree banks already have 'a shared operating system' | in the form of clearing houses and central banks. I don't know | enough about that stuff. But it's the reason why bank transfers | have mostly taken days to complete, rather than seconds, in the | past few decades. | | Come to think of it, there's a huge incentive not to stay in | lockstep with all the other banks if you can offer customers | instantaneous transfers when other banks make you wait for | days. | CamouflagedKiwi wrote: | Why don't software companies have more common operating systems | and data structures? Why is it hard for acquisitions of | software companies to work? They are a common part of business | in that industry too. | rdtsc wrote: | > at some financial institutions, you can get a SAR filed for | knowing what a SAR is, because "advanced knowledge of anti- | moneylaundering procedure" is a characteristic only of financial | professionals and terrorists. | | That is messed up. You ask about a SAR or indicate you know about | them in general, you get a SAR slapped on you, and they close | your account. You're one of hundreds of thousands, why bother | handling a SAR-ed user when they can just move on without you. | | Are individuals allowed to have a public forum to discuss and | share notes of what they did in their account to learn and | prevent this from happening in the future? It seems in a lot of | cases it's using these payment systems like Zelle or have | anything associated with phrases resembling black-listed | countries or organization. | RationalDino wrote: | Yes, individuals are allowed to have a public forum for that. | We have freedom of speech after all. | | However such a forum is going to be of particular interest for | would-be money launderers. And therefore you should expect it | to be monitored by people connected to the financial system. | With the result being that active participation in such a forum | may itself become grounds for a SAR to be slapped on you. | | A SAR that, of course, you will never be informed of. Because, | as patio11 documents, that is the law. | AmericanChopper wrote: | Anti-Money Laundering laws are a complete anti-democratic | tyranny. With AML you are assumed guilty anytime you possess | money, or participate in any financial transactions, or have | any assets. If called upon to do so you will have to prove | your innocence beyond a reasonable doubt, and if you fail to | do so, your assets or money can be permanently seized. All of | this occurs without any form of due process. | | The government actually wouldn't be able to make these | regulations for itself, and the only way it manages to make | AML laws work is with a complete governance anti-pattern. | Where they simply tell the banks that if they unknowingly | allow any "money laundering", then they will be punished, | rather than actually creating some regulations for them to | follow. So the institutions just create these kafkaesque | nightmares themselves, because they don't really care about | who gets screwed over by them. | | The worse part is that money laundering is trivially easy for | anybody who wants to do it, it just costs money to do the | compliance properly. The only people who get thwarted by | these laws are immigrants who do a lot of remittance, and | law-abiding wealthy people who naively think they're entitled | to possess their own money. Two groups that society generally | doesn't care at all about protecting. | | I personally make a lot of money off the AML compliance | industry, so I'm not really complaining for my own sake. But | these laws are the intended outcome of "anti-terrorism" and | "anti-tax-evasion" policies. | lawlessone wrote: | >and law-abiding wealthy people who naively think they're | entitled to possess their own money. | | They should be fine as long as they show receipts. | AmericanChopper wrote: | I really hope this is a joke lol. The amount of paperwork | required today is far in excess of anything required pre- | GFC. Basically any wealth acquired prior to then is up | for confiscation, and this happens all the time. But | again, nobody cares, because injustices delivered upon | the rich are fine. Imagine you inherited a property from | your parents, how do you imagine you'd be able to prove | the provenance of that asset? Or the cash used to buy | it/pay the mortgage on it? You can't. | ls612 wrote: | >Imagine you inherited a property from your parents, how | do you imagine you'd be able to prove the provenance of | that asset? Or the cash used to buy it/pay the mortgage | on it? You can't. | | Do you have an example of what you mean by this? Like | they will say "well you don't have your old paper pay | stubs from the 1990s when you were paying the mortgage on | your house so we will confiscate your house, go die alone | in the gutter"? Because I find that hard to believe. Most | people with wealth have an obvious reason for that wealth | which is documented in the formal bureaucratic system. | AmericanChopper wrote: | > well you don't have your old paper pay stubs from the | 1990s when you were paying the mortgage on your house so | we will confiscate your house | | Yes this is basically how it works. The only contrived | thing about my example is that we're talking about one | house a person inherited, rather than millions of dollars | in assets. | | Here's a well documented example of this happening in | real life | | https://www.latimes.com/california/story/2022-09-30/judge | -ba... | | > A federal judge ruled Friday that the FBI's seizure of | tens of millions of dollars in cash and valuables from | 700 safe-deposit boxes in Beverly Hills did not violate | anyone's constitutional rights. | | > The decision by U.S. District Judge R. Gary Klausner | endorsed law-enforcement tactics that tested the limits | of how aggressive federal agents can be in seizing money | and property in the absence of any evidence that the | owner committed a crime. | | > The ruling did not address some of the most | controversial aspects of the raid, such as the FBI's | attempt to confiscate assets from box holders on the | presumption they were criminals, even in cases where | agents had no evidence to validate their suspicions. | | Of course, nobody cares, because those people are rich, | so they probably didn't deserve that money anyway... | eschneider wrote: | If you inherited it (at least in the US) there will be | probate records. And property transfer records. There's | LOTS of documentation for that sort of thing. | AmericanChopper wrote: | Records that you inherited it are not enough. Where are | the records that your parents acquired it properly? Where | are the records that prove the money they used to acquire | the house were acquired properly? This is the trouble | with a presumption of guilt, proving these things are | basically impossible. | eschneider wrote: | No. Probate records that you inherited it are enough to | get property transferred to your name and the title | recorded as such. If you want to be covered just in case | your parents somehow stole the land and falsified their | ownership, title insurance is a thing. | | None of this is impossible. None of this is unknowable. | This all happens everyday. | AnthonyMouse wrote: | The problem (this time) isn't that they try to deny your | title to the property, it's that you sell the property | and they freeze your account with the money in it and now | the burden is on you to prove that your parents acquired | it lawfully, which you have no way to do because it | happened many years ago and your parents have passed | away. | eschneider wrote: | No. If you have title, it's presumed that the land has | been lawfully transferred. If someone/.gov wants to claim | otherwise, they need to prove that. The entire mortgage | market is predicated on that. Can someone cite an | instance where someone who "inherited property had to | prove their parents acquired it legally because their | funds were frozen after a sale" because I'd be very | interested in seeing that. I'd be a LOT more willing to | believe that a sale fell through because the BUYERS | couldn't verify the parent's title, but that's not what's | described here. | | Do buyers here not do a title exam? | pdonis wrote: | _> Anti-Money Laundering laws are a complete anti- | democratic tyranny._ | | But they were produced through the democratic process: we | have told our elected representatives that we want them to | Do Something about things like organized crime and | international terrorism, and these laws are part of the | Something That Was Done. The laws will not change unless | and until we the people change the incentives we give our | elected representatives. | ElFitz wrote: | Wether or not laws and policies have, in practice, | anything to do with what people want, is still up for | debate [1] [2]. | | It could also be argued that such laws and policies have | mainly been enacted by states in order to eliminate | threats to their authority, legitimacy, or continued | existence, through financial control. | | Which may or may not be the case. Just pointing out that | states, even liberal democracies, may not always be all | about expressing the will of their constituents. | | [1]: | https://www.cambridge.org/core/journals/perspectives-on- | poli... | | [2]: https://www.vox.com/2016/5/9/11502464/gilens-page- | oligarchy-... | pdonis wrote: | _> Wether or not laws and policies have, in practice, | anything to do with what people want, is still up for | debate_ | | If we the people wanted something different, we would be | voting differently. The fact that we continue to vote for | the same incumbents means they are doing what we want. | lcnPylGDnU4H9OF wrote: | Individual House Representatives usually have high | approval ratings from people who voted them in while | Congress as a whole has a terrible approval rating. It's | not quite as simple as seeing historical election results | and saying everybody is necessarily happy with their | representation. | pdonis wrote: | _> Individual House Representatives usually have high | approval ratings from people who voted them in while | Congress as a whole has a terrible approval rating._ | | Yes, that's true. (And the Senate is no different.) What | does it mean? | | I think it means that people do not realize the actual | problem. They don't see the two facts you cite as at odds | with each other or connected to each other at all. But | they are. The _reason_ why Congress can have such a low | approval rating while incumbency reelection rates remain | high are that people think it 's all those _other_ | members of Congress who are the problem--if only everyone | would listen to _their_ members of Congress, all that | stuff would get fixed. They don 't realize that, if you | send someone to Congress to fix something, and it doesn't | get fixed, you need to _send someone else_. You can 't | keep allowing the incumbents to hide behind "it's not me, | it's all those others" forever. | immibis wrote: | There's no evidence that representatives do what | constituents want them to do. In fact, there's evidence | they do what billionaires want them to do. | pdonis wrote: | _> There 's no evidence that representatives do what | constituents want them to do._ | | Sure there is. "Want them to do" means the constituents | decide their votes based on Something Being Done. The | fact that we the people continue to vote in our incumbent | representatives at rates over 90 percent is a direct | measure of the extent to which those representatives are | doing what we want them to do. | immibis wrote: | Mostly we vote based on our personal biggest issue, no | matter what they do on the other issues. A lot of | Republicans vote Republican because they claim to hate | abortion, and they literally don't care about the rest. | AnthonyMouse wrote: | > The fact that we the people continue to vote in our | incumbent representatives at rates over 90 percent is a | direct measure of the extent to which those | representatives are doing what we want them to do. | | This is an artifact of the districting system. A given | district wants the local military base to stay open, or | tax credits for the local industry. Their representative | gets them that, so they get reelected. To get them that | they screw over the general public in a thousand ways -- | mostly by trading other representatives for the things | that aren't in the public interest but _their_ districts | want -- but none of them are big enough for the people in | the district to change their vote, and most of them | couldn 't have been prevented by a single representative | anyway. So the bums fail to get voted out. | pdonis wrote: | _> This is an artifact of the districting system._ | | Which in no way contradicts what I said. The fact that | what the people want (or at least a voting majority of | us) actually screws over the general public does not mean | the people don't want it. It just means that what the | people want is not actually good for all of us in the | long run. Welcome to reality. | RationalDino wrote: | No, that doesn't measure that they are doing what we want | them to do. That measures how effectively they can | convince us that the other candidate would be worse, so | you should vote for the lesser evil. | | On most topics, there is NO candidate who is for doing | things outside of the current Overton window. If, for | example, you don't like our AML laws, you probably don't | have a viable candidate on the ballot who wants to change | our AML laws. Therefore your vote can't show your support | for changing AML laws. | dragonwriter wrote: | > On most topics, there is NO candidate who is for doing | things outside of the current Overton window. | | Sure there is. | | They aren't _likely_ to be a major party candidate, but | then, that 's pretty much true by the definition of the | Overton window -- if it is supported enough to be a | tolerable position for a major party candidate that isn't | an extreme outlier within the party, then it is _not_ | outside the range of acceptability than the Overton | Window refers to. | | (Of course, the major point of the Overton Window is | that, in a system with elected lawmakers, _laws largely | aren 't set by lawmakers preferences_, but by forces, | largely external to lawmakers -- including both | concentrated interest groups and grassroots activists -- | that _shift_ the Overton Window and set the bounds for | what it is practical for lawmakers to support.) | pdonis wrote: | _> that doesn 't measure that they are doing what we want | them to do. That measures how effectively they can | convince us that the other candidate would be worse_ | | If we are convinced, then they _are_ doing what we want | them to do--because they convinced us that there is no | point in wanting anything else. | | _> On most topics, there is NO candidate who is for | doing things outside of the current Overton window._ | | Yes, but what is the Overton window? It's the range of | policies that _most people will accept_. So by definition | only policies within the Overton window can possibly be | what the people (or at least a majority of us) want. | peyton wrote: | Nonsense. It's entirely possible for tyrannical laws to | become self-sustaining by applying them for political | purposes. | novok wrote: | IMO AML should be abolished because it is ineffective, | inefficient and nothing would effectively change if removed. | It recovers 100x less than its compliance cost. It's the TSA | of banking, it's motion without progress. | | https://content.11fs.com/article/aml-is-the-worlds-most- | inef... | RationalDino wrote: | The question isn't how much crime it catches. It is how | much crime it prevents in the first place. | | (No, I'm not suggesting that I have an answer to that | question. Just that you're measuring by the wrong measuring | stick.) | AnthonyMouse wrote: | How much crime it catches is directly related to how much | crime it could prevent. If the measure is totally | ineffective and criminals hardly ever get caught then | there is no deterrent. | margalabargala wrote: | The absolute magnitude of crime it catches is completely | irrelevant. The earlier poster is incorrect saying is | useless because | | > It recovers 100x less than its compliance cost. | | The proportion of crime that it catches is of interest to | criminals and is what will have the deterrence effect, | but whether it catches 10% or 90% is difficult to know as | a layperson. | spicymapotofu wrote: | This is clearly not true. Why else do organizations | involved in large scale ML move to locations with more | lax AML regimes? E.g. crypto in eastern Europe. If the | risk of being caught was no deterrent, ML activity would | be dependent on 'amount of launderable funds' and | independent of AML regime - can you offer an argument | showing this is true? | RationalDino wrote: | It really isn't so simple. My views on this are informed | by https://www.bitsaboutmoney.com/archive/money- | laundering-and-..., so you might want to read that. | | First, there are widely known techniques to beat AML. | Criminals use them. Using them imposes costs. So you can | reduce the profitability of crime, and therefore its | frequency, without catching much crime directly. | | Secondly, one of the goals of AML regulations is to make | it easy to construct a money laundering case against a | criminal caught another way. This is kind of like putting | Al Capone in jail for tax evasion. Tax evasion isn't why | you want him in jail, it is just the thing you can | convict him of. Prosecutors see value in these easy | convictions. | | Are they worthwhile? That's above my paygrade. Certainly | patio11 makes a case that they might not be. But both of | the things that I just mentioned show that the rules are | valued for reasons other than routinely catching a lot of | crime. | Scoundreller wrote: | Thing is, if you're laundering money, you're probably | doing something incredibly profitable (importing kilos of | something that cost you $2k and then selling for $20k, or | just straight up stolen funds with no cost basis). | | These groups have no issue with the few percent cost of | added transaction friction. | | But it really costs people running low-margin businesses | or unsophisticated honest people just trying to move | overseas, remit funds to family or buy a home overseas. | | And the knock-on effects of the bypasses becoming things | like "buy a front-business and care less about the | legitimate competitors that can't compete with someone | unworried about profit" or "buy a house and let it sit | empty". | immibis wrote: | > We have freedom of speech after all. | | You don't, though. | PrimeMcFly wrote: | The US does. Most countries don't. | hef19898 wrote: | All democracies do, one way or the other. | Scoundreller wrote: | Plenty of democracies with weak or highly overridable | constitutions. | | Most of Canada's is like that. Basically governments can | suspend all of your "fundamental freedoms" for 5 year | periods, renewed as often as they like. | ruszki wrote: | Freedom of speech almost never meant and never will mean to | be able to speak whatever you want to whoever you want | wherever you want whenever you want. No matter what | propaganda tells. There are limits and will be limits, and | except anarchists nobody can say that this is what they | really want in good faith. We know as a fact that | uncontrolled free speech is harmful. | | Currently, almost everybody who say this, want something | else, and this is just a tool to achieve that other thing. | A proven harmful tool. | | There is free speech in the USA. | matheusmoreira wrote: | I think it's pretty clear by now that "anti money laundering" | is just the financial arm of warrantless global mass | surveillance. Money laundering may be a crime but it does not | justify this. "Monitoring" people and punishing them because | they "might" be some money launderer or terrorist is | completely backwards and should be a violation of basic | rights. | tlb wrote: | People are massively dishonest about this, though. Like there | are occasional Ask HN posts where someone is outraged that | their bank/payment account was closed for "no reason", but | eventually it comes out that they're in North Korea selling | cannabis to Iran or something. | | But it does seem like the world lacks a manual on How Not To | Get In Trouble With Your Bank. "Structuring" in particular is | something someone might innocently do just because they like | round numbers. | mminer237 wrote: | CTRs are required for $10,000+. Structuring is more like if | you're depositing $9,999, which is kind of the opposite of a | round number. | idontpost wrote: | It would also be two deposits of $5k or 10 $1k deposits, | etc. | AmericanChopper wrote: | The only way to get any assurance about staying out of | trouble with your bank is to have enough money that they | start to not care so much about the risk of doing business | with you, and to pay a lot of money to an expert to do the | AML compliance for you. | opportune wrote: | Completely agree that banks should provide prescriptive | guides. | | IME they really don't like when you work around their eg | 50k/day ACH transfer limit by initiating 50k ACH transfers on | 4 consecutive days to move an account of 200k. But they don't | tell you what they actually want you to do if you want to | move 200k - and for obvious reasons they probably don't want | to make these transfers fully frictionless. They just assume | you'll know to show up at a branch in person or get on a | phone to ask about it and treat you like a criminal if you | don't. | dmurray wrote: | Is that even "working around" the restriction? Surely | moving 50k on each of 4 days is what you're expected to do | in that case. It still means the maximum a fraudster can | get away with is 50k if the fraud is discovered in one day. | | My last bank had limits like 20k/day and 50k/week, so it | seems like yours could have 50k/day and 60k/week if they | "really don't like" you using it like this. | patmcc wrote: | No, you're expected to call and set up an appointment | with a banker who can sell you on some kind of business | account that has appropriate services for moving money in | that way. | | And yes, this will cost more and take more time than the | spreading-it-out method. | alright2565 wrote: | no, this is too cynical. just give them a call, | authenticate yourself, and they'll happily raise the | limit for you. | | maybe if you're moving 50k/week they'll try and get you | on a business account, but at that point you're already | not using the account for the purposed you claimed when | you opened the account. | opportune wrote: | One of the reasons banks have these restrictions (besides | the obvious thing of making it difficult to take large | sums of money out because it hurts their business) is to | prevent fraud. They want to prevent the case where some | criminal gets physical access to my computer, or my login | credentials, and drains my account without my knowledge. | So they want you to initiate a manual verification that | you really do intend to move such a large sum to prevent | that fraud. | | If you do what I did, you usually get a temporary hold on | your account and some very skeptical bank employee | calling you to grill you on what you're doing. | | On one hand I get it. For every story like mine, where | this is just a temporary frustrating inconvenience, | there's probably a story where grandma lost her life | savings after talking to the nice man from Microsoft on | the phone. But also they don't make it clear at all what | you are supposed to do as non-criminal to work around | their restrictions, which is just bad for customers. | sidewndr46 wrote: | working around a restriction is called "Structuring" in | the US: | | https://en.wikipedia.org/wiki/Structuring | dmurray wrote: | This is not true. Structuring is much more narrowly | defined, including in that Wikipedia article. It requires | you to be working around a legal or regulatory | _reporting_ requirement. | xeckr wrote: | Banks have an incentive to create as many roadblocks as | possible to prevent you from transferring out large sums of | money. | dan-robertson wrote: | In particular in the US, they are on the hook for almost | all of it if the money was fraudulently moved out. | quartz wrote: | Couldn't you just send a wire? | opportune wrote: | Yes, but that involves talking to someone and waiting on | hold. If there's no rush, doing 4x ACH is easier, if you | don't know it'll get you flagged. All I'm saying is banks | need to be more prescriptive about telling you "we'll put | a hold on your account if you move large sums without | telling us" rather than giving you some fake limit that | actually utilizing will raise red flags. This is a common | failure mode | callalex wrote: | Those typically have huge fees. | gosub100 wrote: | $25 to move $50k in an atomic, irreversible way isn't a | huge fee IMO. when you're dealing with that amount of | money, the risk of it getting frozen or flagged for fraud | is > $25. A lot of banks will let you send wires for free | if you have a large enough balance. | ska wrote: | Not int the context of these amounts. | | $20-ish to move 200k safely is nothing. If you are doing | it internationally, it's typically tiny compared to the | FX cost. | Scoundreller wrote: | I'd be happier keeping the $25 tyvm. | hef19898 wrote: | And risk getting your account frozen "for no reason", | really smart. | ska wrote: | Sure, write a personal check then and expect a lengthy | hold. Or something else on the risk vs. PITA vs. cost | framework. | | Point is, wires are cheap for what they do. They aren't | your only option, but all options have tradeoffs. | nick222226 wrote: | You do a wire transfer. | opportune wrote: | Yes, my point is that banks don't make it clear that | maxing out their ACH quotas will get your account frozen | and that you _should_ do a wire transfer. You shouldn't | have to learn this the hard way by getting your account | frozen (which is very stressful when it happens to you | for the first time), and banks should make it clear what | you should do, which is my point | ska wrote: | It's a pretty niche problem though, so I guess not | surprising they aren't great about communicating it (it | probably was communicated, on page 30 of your agreement | in small confusing text). | hef19898 wrote: | There are some systems, banking for example, where | "hacking" them and trying to be smarter than others can, | and actually does, backfire. | boilerupnc wrote: | Funny enough. Whenever possible, I round all my tips to cause | the total to generate a particular two digit cents amount - | so that I can easily detect fraud when I scan my statements. | It's my low tech error code check. | velcrovan wrote: | Has this ever turned up anything suspicious? | eadler wrote: | I track almost all of my expenditures. At a restaurant I | used to visit fairly regularly I noticed that my costs | were often off by approximately +-25 cents. This was | inconsistent and not always in one party's favour. Upon | reporting and investigation it turned out that (a) I | routinely wrote 'math' along with a total instead of a | tip and (b) one of the waiters only approximated the math | required. | | Nothing nefarious and I'm not even sure if I won or lost | out of this - but it was interesting to catch. | pdntspa wrote: | > I routinely wrote 'math' | | Why would you do this? | topherclay wrote: | I had to reread this because it didn't make sense to me | the first time because it's so insane. | ska wrote: | Not surprising, right? I don't know what you expected | implicitly asking them to do the arithmetic for you, but | I would've assumed not much care would be taken. | PKop wrote: | Catch what? Why would you do something so silly | boilerupnc wrote: | It actually did. At a wings place I noticed a total that | wasn't my usual last two digits. I called up the place | and they confirmed they had an employee who had been | altering tip amounts and also skimming cards. They | advised me to call my credit card company and ask for a | new card. It is now a well defined muscle memory for me. | Therefore for very little effort I get a desirable side | effect of easy detection. My teen son currently rolls his | eyes when I fill out the receipt but I suspect he'll | adopt the habit in some form over time. | bravura wrote: | What about routine credit card transactions that you | don't tip on? Isn't that the bulk of purchases ? | jdadj wrote: | I use palindromes. Easy to check and will catch extra | dollars added. | aembleton wrote: | I get a notification on my phone when any money is | deposited or withdrawn from my account. If its not | something I've just done or an unexpected amount, then its | probably fraud and I can tell my bank. | zoeysmithe wrote: | This is a little victim blamey. Banks mess up all the time. | Regressive policies in capitalist institutions are extremely | common. Incompetence is common. Negative action in service of | the profit incentive is common. | | There's no shortage of people who found their accounts closed | for "fraud" who did nothing wrong, but instead were | victimized by the algo and the general incompetence of | banking tech. | | Personal financial experts often tell people to carry a | credit card from a bank that isn't yours or have a checking | account at a separate bank because this is so common. | | Lastly, the people moving money to blacklisted places aren't | opening Bank of America checking accounts. There's entire | cottage industries and crypto and shady international banks, | etc ready to cater to them. They're not getting banned | because they use services that don't ban them for moving | money around like this. But everyday working class people get | banned randomly for moving gifts or tuition money around, | etc. | AussieWog93 wrote: | Anecdata, but I've had both my bank account and Stripe | account closed for basically "no reason". | | I still don't know why Stripe closed my account (I was | selling cheap USB oscilloscopes online, never had a | complaint. Couldn't get in contact with them at all when it | happened.) | | My bank account was closed because I filled in a KYC form | incorrectly, and they didn't have a process in place to | follow up properly when this had occurred. | ponector wrote: | Bank closed it because you lied in KYC form. And you lied | again in your comment that they closed for no reason. | izacus wrote: | Making an honest mistake on a complex form isn't "lying" | and neither is it an offense that warrants financial | punishment. What the heck? | ponector wrote: | How about seeing like a bank? From bank's point of view | it could be either honest mistake or deliberate lie. And | if person is lying and have been caught - they always say | it was an honest mistake. | stouset wrote: | I've also heard repeatedly in conversation people frequently | admit to structuring financial transactions for a variety of | reasons, completely unaware that doing so is a felony. | immibis wrote: | Is it illegal to round up your transaction to $10,001 for | the purpose of making the bank file the form so you can't | be accused of structuring to avoid it? | PrimeMcFly wrote: | lol, no. Why would it be? | sicromoft wrote: | It's only illegal if you're intentionally doing it to avoid | reporting | stouset wrote: | They _are_ intentionally doing it because of mostly | imagined consequences of having the transactions be | reported. And committing a felony as a consequence. | teemur wrote: | Sorry, what does "structuring financial transactions" mean | in this context? | sidewndr46 wrote: | https://en.wikipedia.org/wiki/Structuring | zb1plus wrote: | What can be done as an ordinary people to abolish this system? | I firmly believe these types of systems are gross violations of | the 1st amendment | jgilias wrote: | As the Nobel laureate, economist F.A. Hayek said in 1984 - | take the money out of the hands of the government using some | sly or roundabout way. | matheusmoreira wrote: | Cryptocurrency and self-custody. Monero seems like the best | option. | rnk wrote: | When I worked at google they made all the devs in my team take | the anti-money-laundering class. It was pretty basic stuff like | "don't carry a suitcase full of cash across international | boundaries". I remember everyone was amazed that I passed the | test. And it must have been suspicious ;-) | ypzhang2 wrote: | Effectively, its all just based on what indicators have a | sufficient signal-to-noise ratio. If the signal-to-noise is | high enough for any detectable behavior, then it can become a | SAR. | | You can absolutely have a public forum to share tips on how to | stop this from happening. Just know that said public forum will | be mined by money launderers and fraudsters and whatever work | around is posted will most likely fail to work within months. | | You have to imagine that the banking system exists in an | adversarial environment with money-launderers and fraudsters. | And instead of code that will always do whats written, the | interface is a squishy human for a majority of these | interactions. | lozenge wrote: | If you know about SAR, you know that banks can't share | information about them or their criteria with the account | holder. So the only reason to mention it is if you are angling | to bribe an employee to break the rules. | jampekka wrote: | I'd wager the reason a lot of bank systems suck is that them | sucking doesn't matter to the banks, and the suck can be even | beneficial to them. | | It's rather difficult to change one's bank, and banks actually | put up hurdles to make the change difficult. E.g. moving loans | can have huge "rearrangement fees", loan guarantees may be almost | impossible to transfer and the bank account info is in quite a | few places and having it wrong can cause missed payments. | | A good example is that when it was proposed that one should be | able to transfer their account number to another bank (as | telecoms have to do for phone numbers here in Finland at least), | the bank lobbyists said this is technically impossible, which is | of course ridiculous. And that we still this day and age have to | wait for days for a bank transfer to clear. | | There are some new banks (e.g. Monzo) that once you use them, it | really shows that most banks just suck. | | When you have literally a license to create money out of thin | air, you can be really incompetent (except in lobbying of course) | and still make hand over fist. | mrkeen wrote: | > When you have literally a license to create money out of thin | air | | Well, you can loan out some amount of money that you don't | have, hopefully get it returned to you with some interest. | jampekka wrote: | If enough doesn't get returned, the gov/centeral bank gives | it to you as a bailout. And for many loans you automatically | get it from the gov if the debtor can't pay. | vkou wrote: | > If enough doesn't get returned, the gov/centeral bank | gives it to you as a bailout. | | No, the gov/central bank will give it _to the people you | borrowed money from_ as a bailout. | | _Your_ equity will be zeroed out, _your_ executives will | all be fired, and _your_ customer accounts will be fed to | another bank. | jampekka wrote: | Citibank was bailed out, the stock rose over 50% | overnight and the CEO got paid hundreds of millions. | alexb_ wrote: | You realize bailouts are _loans_ , right? They aren't | just free money. | jampekka wrote: | There were many forms of bailout for Citibank (and | others). Some were (extremely favorably termed) loans, | some government backing of their bad assets and some were | buying stock that the market didn't want to touch. | | May or may not be technically free money, but for sure | Citibank doesn't hand out loans to bankrupt customers on | such terms. | | The gov could have e.g. let Citibank go bankrupt and just | take it for free. Like banks do to their customers. | vkou wrote: | Citibank shareholders got diluted, and Citibank _paid | back_ for that bailout, with the taxpayers profiting ~12 | billion in total. | | If the money couldn't have been paid back, the | shareholders wouldn't have been diluted. | | They would have been _wiped out_. | jampekka wrote: | If the gov wouldn't have bailed out Citibank the | shareholders would have been wiped out in the first | place. And gov would have gotten it for essentially free | if wanted. It was not like they saw that here's a great | investment opportunity to make profit for taxpayers. | immibis wrote: | No, that's not how it works. They did this a few times, | even a few high-profile cases, but the vast majority of | times they just gave money to the struggling bank. | skybrian wrote: | That's not how it works. When a bank makes a loan, the | customer will use it to buy something (say, a house), and | probably the money will be put in a different bank. So the | money definitely needs to be there, to pay the other bank. | | There's a deposit in the other bank, along with the payment. | Both of which are "money." | | So, a bank can create money from thin air by making a loan, | but typically not for themselves. It happens in a different | bank. | immibis wrote: | I want to make it a point that EVERYONE CAN DO THIS. Everyone | can make a loan, everyone can count their un-returned loans | as money if they want to, and everyone can accept transfers | of other people's un-returned loans as payment if they want | to. The only special power banks have is that most people | accept them doing this. If your whole friend circle accepts | un-returned loans from each other as payment, then you're all | doing fractional reserve. | jampekka wrote: | The special power is the banking license they get from the | government. Try to do it without and you'll find yourself | in prison quite soon. Especially if you do it in official | currency. | abdullahkhalids wrote: | > A good example is that when it was proposed that one should | be able to transfer their account number to another bank (as | telecoms have to do for phone numbers here in Finland at | least), the bank lobbyists said this is technically impossible, | which is of course ridiculous. | | If you mean the bank account numbers used within Finland, sure, | they can be changed. In the new system, there will be country- | wide database which will now indicate which bank each account | number is associated with. But your account also has an IBAN | number, which has country and bank/institution identifiers. | Those will have to change if a customer moves banks, absent an | international finance law change. | | And my understanding is that its quite common to use IBAN | everywhere. So you won't really solve the problem. Just add | another layer of complexity. | jampekka wrote: | I mean't that you can't change the bank and keep your old | account number. IBAN is just the "Finnish" number with FI | prefixed and check digits appended. Though probably the old | numbers too have per-bank allocated prefixes. BIC identifies | the bank. | | As far as I and a quick web search know, you can't make any | of these refer to an account in another bank. | | Is IP over MAC or DNS over IP just another layer of | complexity? | abdullahkhalids wrote: | The point is that in your proposed system in which the | customer keeps their local bank account number when moving | banks, there will still be places where the customer will | have to change their number - i.e. everywhere where their | IBAN is stored. The IBAN cannot remain the same, because | international institutions need to know which institutions | they are dealing with. Not all institutions are legally | allowed to or want to transact with all institutions. | | So the added layer of complexity is that customers will | have to change their number in some places but not in | others. And banks will have to have a system of ensuring | they match the right IBAN with the right local account | number. Whenever this fails, there will be problems such as | delays or money being deposited in wrong accounts etc. | | This is unlike DNS over IP, which is | universally/internationally agreed protocol which has 100% | coverage. But even in that system, whenever you change your | DNS settings, it takes a while to propagate, and in this | time there are all sorts of weird errors. Cat picture | websites can tolerate those sorts of errors. Financials | institutions should not. | immibis wrote: | Can't Finland register the whole FI prefix as institution | "Finland"? If other countries' institutions need to know | the actual institution, well... it wouldn't be the first | time two countries had conflicting requirements, and | politicians had to get together and yell at each other a | bunch and suddenly a law was passed to solve it. | jampekka wrote: | You mean universally/internationally agreed protocol and | maybe a set of laws like e.g. IBAN? | | The bank numbering system was indeed a static routing | code, like phone numbers were in old landlines. Why the | former can't be changed but the latter could? | abdullahkhalids wrote: | Of course the IBAN system can be changed. It will just | require a revision of international treaties, which will | require dozens of countries agreeing to it. Finland has | little control there. | namdnay wrote: | > When you have literally a license to create money out of thin | air | | This is a common but slightly misleading interpretation of | fractional reserve banking. | | If I lend you 100 bucks and you lend those 100 bucks to someone | else, you've "created 100 bucks" in a monetary sense. But it's | not coming from thin air, from an accounting perspective it's | just a debt moving from one person to another | kaibee wrote: | Yes, but when I deposit $100 with @Bank (ie, effectively | lending $100 to the bank), they aren't loaning out $10 to a | couple people, they're lending out $100 to a couple people, | because they did the math and figured that they can get most | of those people to pay them back before I ask them for my | $100 back. This is all well and good, but they really are | creating money out of thin air when they're loaning out more | money than they actually have on hand. | xcrjm wrote: | > A good example is that when it was proposed that one should | be able to transfer their account number to another bank (as | telecoms have to do for phone numbers here in Finland at | least), the bank lobbyists said this is technically impossible, | which is of course ridiculous. | | This comparison doesn't make a ton of sense. Of course you can | transfer your phone number - every phone number is mandated to | be unique across all carriers. Bank account numbers are | entirely internal to each bank and made up based on various | arbitrary factors. What if the bank you want to move to already | has an account with the same number as your account at your | existing bank? How would that work? | jampekka wrote: | May depend on the country, but at least in Finland the | account numbers have been unique across banks for ages. The | first part refers to the bank (actually a branch at least | back in the day) and the last part to the account within the | bank. There was and is no need to specify the bank | separately. | | The mobile phone numbers had the same system. Three first | numbers signified the operator, but the whole number it can | now be transfered to another operator. | | This is not hard stuff. The numbers aren't magic, they're | just identifiers. We're not bound to mechanical routers or | card sorting machines anymore. | techsupporter wrote: | > And, as a particular thing which could help unlock that: if one | cares a lot about the experience of people at the socioeconomic | margins, one should perhaps spend less time fulminating about | greedy capitalists and spend more time reading Requests For | Public Comment by relatively obscure parts of the administrative | state. | | For what it's worth, there are a _staggering_ number of people | doing political advocacy who follow these sorts of things. The | main problem is, unless you are inside that system, there is no | (scalable) way to know which relatively obscure parts are about | to do something that you want to comment on. And, as patio11 | wrote out, it 's a massive system that has been layered on top of | layers. | | Part of the reason why spend "time fulminating about greedy | capitalists" is because those "greedy capitalists" are the ones | _inside the system_. Hell, a good amount of time, advocates are | having to spend time pushing back against "greedy capitalists" | because the status quo is already known and understood, but a | change would cost money even if it is beneficial so the change | must be opposed. | | What advocacy could really use is more people who have this deep | understanding and can write out lengthy articles like this | explaining all of the ins-and-outs to come along with the | advocates as a guide. The problem is, the economic and cultural | incentives don't work like that. | cafebee wrote: | > For better or worse, the side channels are not an accident. | They are extremely intentionally designed. Accessing them often | requires performance of being a professional-managerial class | member or otherwise knowing some financial industry shibboleths | | What is meant by side channels here? Is it writing "a paper | letter to the VP of Retail Banking", as mentioned elsewhere in | the article? That doesn't seem "intentionally designed", so the | author must be referring to something else, but I don't have the | imagination to guess it | RationalDino wrote: | That is an example of a side channel. | | That's the kind of thing done by people who the bank really | doesn't want to offend. The bank decided it wants that to work | for them. Therefore the bank created a way of making sure it | works. | | That it is not documented or advertised is a feature. | seraphine wrote: | Not sure if this is what he meant but you can call a bank or | visit a branch, get a phone number for a specific department | and call them directly and get almost VIP levels of helpful | service in my experience. | | Something that would entail hours of phone support thru | official channels cut down to 15 minutes. Once you discover | this there's no going back and it all depends on who you ask, | and how you ask. | timerol wrote: | The "intentionally designed" part isn't just the mail, it's the | process that comes after receiving mail. The VP of Retail | Banking does not read their own mail. Who does read that mail? | How are various letters delegated to appropriate teams? What | letters are discarded or given a canned response? How does the | bank make sure that it doesn't ghost people (most of the time)? | It basically needs an entire support system, which may or may | not rely on parts of the official support system | tomjen3 wrote: | And now you wonder why wanted crypto to succeed. It was not | because it was quick way to make money: It was so that banks had | to compete with real technology and so that no one ever had to | have their lives savings stolen by bankers with no recurse. | timerol wrote: | > so that no one ever had to have their lives savings stolen by | bankers with no recurse. | | This is meant sarcastically, right? Crypto is extremely | efficient at causing people's life savings to evaporate | immibis wrote: | Not by bankers, so it's all good. I will say, PancakeSwap | stole a trivial amount of my money, and probably more of | other people's. Are they bankers? | shakow wrote: | The Forex is equally extremely efficient at vaporising life | savings, still you wouldn't say that's the fault of the | dollar/euro/yen/yuan/dinar/... | ranger207 wrote: | The story of crypto is the story of recreating the existing | financial system from scratch, particularly including all its | regulations that make the current modern financial system so | annoying. Yes, the current financial regulations suck, but each | one was put into place because of failures like you see in | crypto every day. In the long run cyrpto regulation will wind | up looking much like modern financial regulation because it | suffers from the same pressures, incentives, and attack | surfaces as the modern financial system. This isn't to say that | the current financial regulation regime is good in any sense of | the word, just that it's effective at what it's explicitly | designed to respond to. Crypto that lacks the regulation of | modern finance will suffer from one set of problems; modern | financial regulation suffers from another set of problems | emergent from the system of regulation itself. That crypto | doesn't suffer from problems caused by the system of | regulations does not make it inherently better than modern | finance | abdullahkhalids wrote: | Cryptocurrencies had two main goals | | - Let individuals freely transact. Which as you rightly point | out, has failed for good reasons. | | - Prevent state institutions from controlling monetary | policy. This has not failed yet - mainly because crypto is | not even remotely big enough that the state has tried to | control how much cryptocurrency is printed. If cryptocurrency | ever gets big enough, we will find out whether it can | withstand the pressure. While cryptography to secure your | communications has withstood state pressure for 30 years now | to not allow backdoors, I think the pressure on | cryptocurrency will be higher. | popol12 wrote: | I disagree with your first point, Bitcoin let has let | individual transact freely for a decade now. Sure, it has a | hard time scaling but apart from that I think it's doing | great on this point. Could you detail what you had in mind | if you disagree ? | immibis wrote: | There are fraud prevention institutions out there who | secretly colour your coins and won't let you deposit to | an exchange (or trigger some very intensive verification | and a police report) if you try to deposit certain coins. | mattdesl wrote: | > Let individuals freely transact. Which as you rightly | point out, has failed for good reasons. | | How has it failed on this metric? A user holding crypto can | transact freely and without intermediaries, that much is | true of the blockchain. That some governments around the | world may decide to restrict this activity with the threat | of force (some countries more than others) does not mean it | isn't achieving its goals of a permissionless digital | network. | abdullahkhalids wrote: | Of course, X can send Y cryptocurrency, and Y will | receive it. | | The problem is that for the vast majority of people, the | only way for X to acquire the cryptocurrency is to sign | up for an exchange. And for Y to actually use it, they | will have to convert to fiat via an exchange. And when | signing up, X and Y will have to reveal complete | financial details about themselves - home address, bank | account details, identification document scans, etc. | | This means that governments across the world now exercise | significant control over who you transact with. And how | much tax you pay for your crypto activities. If | governments don't like you, they will force the exchange | to kick you out. Or they will block all your bank | accounts - like my own country often does - almost | completely destroying your life. | | This is a far cry from the early dreams of | cryptocurrency, where people thought that governments | would have close to zero control over their transactions. | Yes, right now, crypto is a bit more free than other | types of transfers, particularly for international | transactions, but the noose tightens every year. | | It doesn't matter what the technical details of the | protocol are, what matters is what you can do in | practice. | valcron1000 wrote: | > Let individuals freely transact. Which as you rightly | point out, has failed for good reasons. | | How has this failed? Every month I transact in crypto while | I could not do the same using traditional methods. | immibis wrote: | And yet cryptocurrency managed to recreate its own equally | complicated messes! E.g. lightning network, bridge tokens, swap | routers, parachains. | | It turns out that scalable distributed systems are really hard, | and scalable secure distributed systems are even harder - who | knew. | yboris wrote: | The book _Seeing Like a State_ referenced in the article is an | amazing read: | | https://www.amazon.com/Seeing-like-State-Certain-Condition/d... | | Highly recommend, though glance at summary to confirm you'll | enjoy / benefit: | | https://en.wikipedia.org/wiki/Seeing_Like_a_State | orliesaurus wrote: | ty bought it | tomjakubowski wrote: | one of the great books on understanding corporate management | too. | RachelF wrote: | and if you want some rather funny videos on this topic: | https://www.youtube.com/results?search_query=reasontv+uninte... | Symmetry wrote: | It's a great book but one sided in its analysis. I'd recommend | pairing it with a book about a case where High Modernism worked | great, like The Ghost Map or something. | | https://www.goodreads.com/book/show/36086.The_Ghost_Map | nomat wrote: | It would be cool to map the relationship between a book getting | linked on HN and its checkout rate at the local public library. | That's usually the first place I head when I see something I | want to read on here. | spicymapotofu wrote: | Your local library has a much better offering of niche non- | fiction than mine. Many of the texts I see here aren't even | available through my school's cross country academic network. | I did read this book that way, but I had to wait for it to | come quite a distance. | | My city's newest library is an art piece with less books than | any other here, to be fair. | gniv wrote: | Interesting read, as usual. | | "You can understand why, right? From their perspective, they were | just going about their life, doing nothing wrong, and then for | some bullshit reason the bank charged them $35." | | I'm not sure it's quite right to blame this on math illiteracy. I | think some people are still in denial on bank fees. | immibis wrote: | The reality is the person also got paid $500 on the same day, | but even though the paycheck arrived early in the morning, the | bank chose to process it late at night to collect that $35 | overdraft fee in the meantime. | sherlock_h wrote: | Great article. Explains the chalenges that I just had with having | all money frozen with Marcus.com. It is literally impossible to | break through these layers of support in order to get your case | heard / solved. The biggest challenge is that it's so | intransparent with very little communication from the bank as to | how a support case is actually moving through and how close it is | to getting resolved. | woodruffw wrote: | > Sometimes the bank will have ability to e.g. share context | between their screen and the Tier 2 rep; sometimes they're | literally incapable of proving to the bank that they work there. | | I've experienced this one directly: I ran into an issue with a | large transfer between banks a few years ago, and watched with a | mixture of amusement and anxiety as the branch employee was | unable to prove his identity to his counterpart on the line. He | was supposed to share some kind of OTP to prove that he was in | front of a branch computer, but whatever microservice was | responsible for generating and/or delivering the OTPs was | offline. | cratermoon wrote: | This could also apply to the way airlines see passengers. In my | experience, passenger information is scattered across different | systems and representation. One system tracks the reservation | itself, which has information 1 or more passengers. Another | system tracks the fare and various feeds paid or due. Another | tracks check-in status. Yet another has seating information. Bags | checked live somewhere else. There's not a common key. There are | of course confirmation numbers (those 6-character codes), but | only after a reservation is confirmed. If a person has a frequent | flyer code, that's another key. | | As the passenger moves through the system, each different subset | of attributes is attached only to the system in which it lives, | and cross-correlating a passenger across systems is done in | numerous ad-hoc ways. | | The customer service folks have a lot of tribal knowledge, and if | you happen to get an experienced one, they can really smooth the | way. During the pandemic, though, a lot of people left the | industry, and a lot of knowledge just walked out the door. | donalhunt wrote: | > Ops feels like the world is on fire because the world is always | on fire | | This gave me a chuckle. :) | creeble wrote: | Funny comment about First Republic and Chase. | | I too have/had a mortgage at FR and I now see it in my existing | Chase account (maybe the balance is even correct, pretty hard for | me to know), but I have no idea whether they are going to still | take the payment out of my FR checking account, despite their | official transition page saying "all automatic payments will be | transferred as well." | | I guess I can't take the money out of my FR account until I know. | numlocked wrote: | Too funny. I am in the _exact_ same boat. For what it 's worth | I spoke to their customer service (Chase) yesterday who | indicated that the auto-payment would continue to work as it | always had, but will process "10 days late". So I'm expecting | it to come out of my FRB account on the 10th or the 13th. | | I was also caught totally off-guard when I logged into FRB and | it informed me my mortgage had been closed. If I didn't have a | Chase credit card (and saw my mortgage there when I went to pay | the credit card) I'd probably still be baffled. | creeble wrote: | I think I also saw that only this _first_ auto-payment will | work -- after that you have to set it up at Chase if you want | to continue auto-payment. | | One thing I found out about mortgage auto-payments at FRB was | that they wouldn't take the money out unless there was enough | in the account within the first 6 days of the month. They | would automatically check every day, and if the balance was | high enough, they would take it out. On the 7th day I guess | they would send you an overdue notice (and maybe keep | checking? no idea). They could only do this because they | owned both accounts. | toasted-subs wrote: | Idk man, it seems like banks use swift to communicate. Imo Taylor | swift is a united person, the banks are relying on the foundation | of credit unions. Which have me at the very tip. Y'all want aids? | Seems like you have it. | pdntspa wrote: | I didn't read the article as it appeared to go off on tangents | that don't really get to the heart of the matter: SARs and | everything else are super super secret and there are severe | penalties for even cluing someone in about them. There is a lot | of bullshit clockwork that is hidden from consumers under the | guise of anti-money-laundering and anti-organized-crime stuff. If | I recall the training correctly, you aren't even allowed to | acknowledge there is this whole secret process! | | Which is stupid. All of this is because FinCEN has banks by the | balls | gravitate wrote: | What about 'neo banks'? I am with Revolut free tier and I know | why they have a free tier/basic tier, because I know they | monetize my bank statements and purchase habits for 'market | research' and other insights. | grishka wrote: | I don't know what banking is like in the US, but having to deal | with a UAE bank was a culture shock for me. This article made me | understand _why_ it 's so shitty. No one seems to want to do | their job. Everything -- I mean _everything_ -- takes ages. The | branch employees are utterly powerless. The only thing they can | do right there and right now is cash transactions, everything | else requires a form to be filled and signed and sent "to the | back office" for the thing you asked for to _maybe_ happen in "3 | to 5 working days". I have only tried calling them once. They use | a toll number, but then still try their hardest to "solve your | issue" through an automated voice menu before you have any chance | to talk to a real human. Writing to the right person directly to | their work email sometimes gets your problems solved very quickly | though. | | It was a culture shock because I'm Russian and banks don't play | as important of a role in our society because of the Soviet past. | Yes, most of our population has a bank account these days. Yes, | most people are paid by transfers to that account. But -- our | entire banking system _was built from scratch in the 90s_. So if | you have an issue and you go to a branch to get it sorted, you do | get it sorted on the spot by a branch employee. It probably also | helps that many Russians "don't trust banks" so they'd go to an | ATM on their payday and withdraw their entire salary and use cash | for all their transactions. We've also never had checks, we | skipped that entirely. We also have this nifty SBP system that | allows you to instantly make a transfer from any bank to any | other bank using just the recipient's phone number. Very useful | for things like splitting bills. I was shocked to find out that | most other countries don't have anything like this and even | sending someone money within one bank is quite _a process_. | nologic01 wrote: | There should be more of this. Much more. From different angles | and view points but with the same clarity and directness. | | Banking is in a deep, existential crisis for decades now and the | march of digitization only increases the pressure to find a way | forward. | | In response techno-solutionists imagine all sorts of | replacements, whether it is "fintech", or "banking-as-a-service" | or "crypto" but all are hopelessly shallow and incomplete, almost | insultingly crude. | | What is entirely missing from these neobanking movements is any | straight definition of what is the _purpose_ of banking and | bankers. What is their irreducible value proposition that cannot | be delegated to machines and algorithms. What is their role in | society. Are they allies or enemies of surveillance capitalism? | Are their users clients or products? Can there be an honest | relation with the sovereign monetary system and the lender of | last resort or is private banking a scheme to privatize profits | and socialize losses? Last but not least, what role, if any, | should they play towards environmental sustainability. | | The questions and challenges are pilling up and there are no | breakthroughs worth mentioning. In a parallel universe we might | have something like BN (banking news), where all sorts of | individuals, teams small or large, would pimp their blogs, | radical ideas, open source solutions or fancy software products, | but above all a positive, forward looking vision for a crucial | sector. | iamleppert wrote: | Treat bank accounts like an unreliable host. You wouldn't have a | single database instance running your entire business like you | shouldn't have a single bank running your business. | | Open multiple accounts and when one starts acting up change it | out for another. Always have several bank accounts at the ready. | | Every transaction you make has risk, counter party risk extends | to your financial institution as well. | | You should be running drills every quarter and randomly switching | up your bank. Don't be a victim when you have engineering | solutions to these problems! | | If you have money in an account at a bank for business | operations, keep that in a completely separate bank and legal | entity than the one with a risky transaction profile. Use an | intermediary bank to receive deposits from the likely to close | bank account that transfers money out immediately to your | operational account, and make sure it's at a competitor. Banks | don't share info and you can take advantage of slow processes and | communication delays to give enough time to fix problems with a | flaky bank before they impact your business. Think of it like a | firewall for your business. ___________________________________________________________________ (page generated 2023-11-07 23:00 UTC)