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Subscribe to RSSMsnbc.com's Alex Johnson explains why pre-paid cash cards make tracing terrorists' money trails extremely difficult and how it could have hindered 9/11 investigations.
As the federal government tells it, the money men behind the Sept. 11, 2001, hijackers would never have been identified had they not been lousy bankers:
"The 9/11 hijackers opened U.S. bank accounts, had face-to-face dealings with bank employees, signed signature cards and received wire transfers, all of which left financial footprints. Law enforcement was able to follow the trail, identify the hijackers and trace them back to their terror cells and confederates abroad."
That's from a Treasury Department assessment of financial security threats in 2005. It went on to warn that the terrorists could have quietly moved large sums of money into or out of the U.S.:
"Had the 9/11 terrorists used prepaid ... cards to cover their expenses, none of these financial footprints would have been available."
Six years after Treasury identified that vulnerability, concern that drug smugglers and terrorists are exploiting it is driving the federal government to change the rules for issuing and using prepaid cards, particularly high-value reloadable cards like the cash cards you might take with you on vacation.
By making it harder to get prepaid cards without subjecting buyers to government scrutiny, regulators and lawmakers hope to make it easier to detect patterns of money movement that could signal something nefarious. But card issuers and some business experts warn that the expense and paperwork involved in the new restrictions, which require issuers to keep records on who bought how much for five years, could drive smaller card operations out of the market.
A problem that's hard to quantify
When the government refers to "prepaid debit cards," it's not talking about the standard bank debit card you probably have in your purse or wallet. Because such cards are attached to bank accounts, they're already closely monitored my numerous federal agencies. If you gave a bank debit card to someone to do something bad with, it and you would be easily traceable.
One of the new rules, in fact, is to rename prepaid debit cards, which also used to be known as "stored-value cards," to avoid confusion.
They're now called "prepaid access cards" because they're not tied to a bank account. They're just pointers to a sum of money you've already paid up (or been given) in advance. The money itself can be anywhere, including accounts outside the reach of government monitoring.
"The distinction actually makes good sense," said James Angel, a business professor at the McDonough School of Business at Georgetown University.
"You don't have that much risk of terrorism through a (bank) debit card," he said in an interview. "There's a problem with a prepaid card because it can begin with cash — the trail is broken, and you can't track where the money came from."
Prepaid cards, and their fees, go mainstream
Jim Schlegel, a senior product manager at ACI Worldwide of New York, which creates and manages electronic payment systems for banks and major retailers, said the new rules are well-intentioned, but he questioned just how big a problem money laundering through prepaid cards really is.
It's "such a small percentage of the overall problem, and attempts to propose very heavy legislation and requirements around it put a drag on an otherwise growing and profitable sector," he said in an interview.
Law enforcement agencies and banking regulators acknowledge that there's no way to know how much money is being moved undetected across U.S. borders through the cards — that's the point of money laundering, after all.
But in a report late last year on money laundering and cross-border currency smuggling, the Government Accountability Office cited the Treasury Department's 2005 assessment to urge action to crack down on misuse of prepaid access cards, saying it was convinced that the shuttling of criminal proceeds across the border, "whether in the form of bulk cash or stored value" (on prepaid cards), poses "a significant threat to national security."
In an examination of the threat last year, the Financial Action Task Force, an international agency established by the G-7 in 1989, said such an operation typically works like this:
A criminal organization repeatedly loads a prepaid card in increments just below the amount that would trigger a report to the government. (In the U.S., that threshold is $10,000, so if it were based here, the organization might regularly reload a card with $9,900.)
The card, or a second card linked to the same account, is sent to an associate, perhaps in another country, who withdraws the funds through ATMs. In one such operation based in Australia, more than $100,000 was laundered this way, the FATF reported.
That's how the Black Guerrilla Family, a Baltimore street gang, worked, according to a federal racketeering indictment, to which three gang leaders and accomplices pleaded guilty in April.
For more than a decade, gang members locked up in Maryland's prisons blackmailed fellow inmates and sold narcotics and other contraband, the FBI said. They then "laundered the proceeds of their illicit activities through the use of pre-paid debit cards" sold by Green Dot, the nation's largest seller of the cards in retail stores.
The U.S. would seem to be especially vulnerable, because it's the world's biggest user of prepaid cards; the FATF report projected that by 2017, the U.S. will account for 53 percent of the worldwide market.
Steve Streit, chief executive of prepaid access card firm Green Dot, told CNBC last year how the cards work.
Follow the money to find the bad guys
How is this specific roadblock to tracking transactions a threat to security, especially when authorities can't quantify it as a significant percentage of all money laundering?
In congressional testimony last year, FBI Director Robert Mueller called the use of prepaid cards a "shadow banking system" that had "impacted our ability to gather real-time financial intelligence."
The new rules not only are supposed to make it easier for the FBI and other agencies to track prepaid cards back to the original purchasers; they also require issuers to alert the government to any large or otherwise suspicious transactions, like those multiple $9,900 purchases. That can all add up to a pattern of evidence that could tip off investigators to larger plans that are in the works.
The rules take effect Sept. 27. They fill 69 pages as drawn up by the Financial Crimes Enforcement Network, a branch of the Treasury Department known as FinCEN, illustrating just how complicated the industry that manages prepaid cards really is.
There are two main types of prepaid cards. One is called "closed system"; these are usually gift cards, student meal cards or transit and phone cards. They may or may not be reloadable depending on the program, but they're usually usable only with specific merchants, so their value in moving large sums of money is limited.
Of more concern are "open-system" cards, like those issued for some electronic payroll systems and travel programs and usable at thousands of businesses across the U.S. (If they're "branded" cards — that is, if they come with the Visa or MasterCard logo — they can be used to withdraw money directly through ATMs.)
Such cards make "the challenge of smuggling heavy stacks of cash nearly obsolete," Kumar C. Kibble, the deputy director of U.S. Immigration and Customs Enforcement, told Congress in March.
Jasbir Anand, a senior consultant at ACI, said the funds represented on such cards, which you can easily buy online, could "travel across borders without limitation."
"You could have tens or hundreds of thousands of dollars associated with that card," Anand said in an interview, calling that "obviously a glaring exception" to current anti-money-laundering laws.
‘They've got to find somebody' to regulate
The new rules, in effect, shift the focus of regulation from where and how a card is used to where and how it is sold, Schlegel said.
"How do you investigate the funds related to a particular product ... when that card is merely an access point to a larger system?" he asked in an interview.
To put it another way, Anand said, the card itself is just a worthless piece of plastic. It's a token representing money that's being held somewhere else, very much like your checkbook.
In the same way that a husband can give his wife his checkbook, "I can give you the card, and that's not a financial transaction," Anand said. And "since that cannot be governed and controlled," the new rules target transactions the government can plausibly regulate — the actual initial loading of value onto the card.
"They've got to find somebody" to monitor, said Angel, of Georgetown University.
The rules include numerous exemptions to make issuing lower-value cards easier for those merchants, by excluding closed-loop cards — that is, gift cards and the like that can be used only at particular stores or service providers — of less than $2,000. They also exempt government-issued cards and many prepaid health care cards. The Treasury doesn't consider any of those to be a significant money-laundering threat.
But most open-loop cards, which can be used pretty much anywhere, fall under the regulations, and the onus to do all the paperwork falls on whoever "exercises principal oversight and control" of the card program. The rules don't clearly define what businesses are in that category.
That's not an issue for banks, which are heavily regulated and have processes in place because they already monitor billions of credit and regular debit cards. But many other previously unregulated or lightly regulated businesses issue or administer prepaid card programs: online shopping services, corporate rewards card programs, third-party payment processors — even celebrities, like the Kardashian sisters, who withdrew their Kardashian Kard from the market last year after customers complained about its high fees.
ConsumerMan: Prepaid cards will have you paying, all right
"The net impact of these rules would be an increase in the overall cost of debit cards for consumers for record-keeping and storage and so on that will eventually trickle down to fees on the debit card and a limitation on features," Anand said.
That also could choke adoption of future technologies developed on the science inside the stripes on your plastic cards, he said. An example would be cashless "mobile wallets" that live in your phone and work through near-field communication wireless systems.
"It's unfortunate that we're at the cusp of taking advantage of this huge channel and trend and something like this could really stifle growth," he said.
Even as it warns about the potential money laundering threat, the Financial Action Task Force also acknowledges that tight restrictions on prepaid cards could have a significant impact on lower-income people unable to "take full advantage of mainstream financial service providers" because they have a poor credit record, for example, or because they have no permanent address and can't qualify for a bank account. That's more than 17 million Americans, the Federal Deposit Insurance Corp. says, and for them, prepaid cards can be the only way they can gain "ready access to services," the FATF said.
"It is important to recognize that public officials can sometimes take steps designed to 'protect' those who are disadvantaged when those steps may actually become barriers that actually restrict access to financial services," the task force said in a follow-up report in June. "For example, steps that add to the costs for prepaid products may make them less appealing to those living on the margin."
Customs is no barrier
There's another issue: The rules apply to transactions that take place in the U.S. Reputable overseas banks and other companies that want to continue doing business here will likely comply, but the U.S. can't impose its wishes on hundreds of thousands of merchants in other countries.
"I can walk into a country with a prepaid card that has a thousand dollars on it and add more to it," Anand said, which means that even under the new rules, a smuggler or a terrorist can easily obliterate investigators' money trail back to the source.
"Suppose I were a terrorist and I needed some money to buy some bomb-making materials locally, but my source of funding is over in Berzerkistan," Angel said. "They can have one of their operatives take a pile of cash, buy a prepaid card and get that into my possession without it being traceable back to anybody else in my terrorist cell."
And how would that operative get the card into Angel's possession? He or she would simply fly into the country with it. Prepaid access cards aren't treated like cash, which travelers are required to declare if they're carrying $10,000 or more.
"The debit card that looks, smells and tastes like (cash) — that doesn't count," Angel said.
Three senators — Amy Klobuchar, D-Minn., Tom Udall, D-N.M., and Jeanne Shaheen, D-N.H. — introduced legislation last month to close that loophole. It would require travelers to declare "prepaid cards totaling more than $10,000" when they enter or leave the U.S., just like cash.
That may sound like a common-sense approach, but card issuers and others have objections. The losers, they contend, won't be drug smugglers and terrorists — who likely wouldn't comply — but travelers and other innocent customers.
The rules could make prepaid cards less attractive to travelers, putting them at a competitive disadvantage to credit cards and other standard bank cards, which wouldn't be covered, said Kirsten Trusko, executive director of the Network Branded Prepaid Card Association.
The NBPCA, a trade group for companies that issue of prepaid cards carrying the logos of networks like MasterCard or Visa, has weighed in against similar attempts to require customs reporting of cards, calling them "unwise and impractical."
That's because you have to know the value of your prepaid card to declare it, Trusko said. And trying to determine a card's balance "while in flight or upon debarkation from a plane is burdensome and unnecessary," she said in a statement to msnbc.com.
Angel said the problem is more basic.
"I would think someone with a card with $10,000 or more on it would probably be watching it carefully and know they're over the limit," he said. But he warned that "the devil is always in the details," asking, "How are they going to catch somebody who violates?"
"If you're wearing a money belt with hundred-dollar bills in it, that's going to be kind of obvious," he said. "But if somebody's carrying a MasterCard, how are they going to know? It could get fairly invasive when they start searching people at the border."
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Jeanne Shaheen is a Democrat from NH, not VT.
Banks will have to figure this out fast. They make a lot of money laundering drug money in their Mexico branches. Check out Wells Fargo Mexico- look at the fines that they have paid when caught. Forreign banks in Miami do the same. These honorable and respected men will have to pay off a lot more regulators to make sure they can continue to live the low life.
Just do away with them all together. Why would you need one in the first place, if you were not trying to hide something. If you have 10K in a bank account, you would have no problem getting a regular credit or debit card. I'll bet the problem is larger than anyone has ever expected.
Another option would be to make a $1000.00 limit on the cards, but then again, if you had 50 drug dealers or terrorists you could still clean 50K as often as you like.
Seems like hussein o. doesn't want other politicans to use the same technique that he used to amass such a large financial warchest. With these cards it is impossible to tell who contributed to to his election...Hugo Chavez was a main contributor as well as the old KGB....(which is still alive and well and very proud of ol' hussein....Why ? because he is finishing the job that they started)
It is not about Terrorizm or "saving " us from drug cartells. It is simply about those of us working our butts off paying taxes! The story mentions Several federal agancies tracking credit and debit cards with invasive spying and monitoring. It never mentions the IRS. Another Democrat trying to sell the public acceptance on HUGE government in our daily lives. BIG BROTHER has became a MONSTER goilla. I have a huge problem with the government or anyone having a close and personal view into my personal or proffessional spending habits. Is'nt it funny how most Democrats want HUGE government in the lives of everyone, but the hypocrits dont want the government looking into their marajuana smoking.
a---rand, U seriously think that illegal use is the only need for a card like this? We use these cards to issue our children some easy and safe to carry money. It is neat way they can have spending cash when they need it, with some saftey built in via codes. Also I use them to buy online and with other business during travel or with businesses I am not familiar with. It is a saftey net for buying with companies. I have had my bank accounts DRAINED by fraud. Using my banking credit and debit card has offed criminals my information and allowed them to tap my entire wealth in that account. A prepaid card only has the amount on it that I choose to add for respective purchases. If I want to buy an item that costs 439.00 I can add 440.00 to the card. If someone mischevious uses the credit card info innapropriately, I stand to loose only 1$. But wait..... the government needs to 'protect me' from whom? Who protects me from the government? Certainly not we the people. We are now too small to fight the beast the government has become.
Yes, I agree there are some legitimate uses and users for this product. However, not everyone likes to use, trusts the use of or is eligible for use of bank accounts.
An additional illegitimate use is that illegal immigrants use them. I know they do around where I live anyway. Very convenient to send money back to relatives in their home country as well as easy to use in this country.
Also it is easy to hide being paid in cash using the cards.
Please, this is nothing more than yet another means of tracking your money. They want access to all your money. Ever have an IRS audit seize your bank account and safety deposit box? Even if they were wrong or confused you because you had a stolen identity? Then there are the people who don't have bank accounts for various reasons, number one reason being they don't have enough money at any one time to open an account or they have a tendency to overdraw their accounts, racking up large fees. Then there are some unscrupulous banks (BofA) who will hold deposits and once deposited, too late to avoid overdraw fees.
Amazing how many civil rights are destroyed in the name of keeping you safe from terrorists.
I Know ! ! ! Let's All go back to Waumpum . Carrying that many Sea Shells would be easy to track , impossible to hide , and Really, Really worth something . The Computerized International Banking System and especially the United States Banking and system of moving money is held together with computer systems, Duct-tape , rubberbands , and paperclips . It's so Fragile around the world and easily breached that specialists continually travel world-wide to keep all this "nothingness moving and accountable ." This IMPORTANT part of information is on a , "NTK" security basis . I am fortunate to know this privledged information and it IS reliable . It used to be that to work in banking You had to have a Clean police record-Not anymore. The SAME Cats convicted of Financial Felonies in the last ten Years are BACK on banking boards of Directors including CEO's of Major Financial institutions . Clean UP the Political system....I Mean down to every congressman and senator ,not forgetting ALL staff members of their offices and start Over . Just for brevities sake , of President Clinton's Staff Over HALF could NOT meet clearance standards for the information they handled . Well to solve it Quickly he issued a Presidential order to allow them immunity from the past for those clearances that were "required to work in the White House. How would You like a Felon handling Your money ,as a stockportfolio manager or a banking system . Well....for the last Twenty Years they have and look how much money , Investments and Retirement accounts ,(supposed to be the most SOLID place to put Your money Have Disappeared into the "thin air" and Bank CEO's Pockets . " The Government that a People Have is The Government They Deserve ." My Heart Truly Goes out to ALL the people who Invested their life savings into Municipal Bonds and Retirement IRAs which the Elected officials took and invested into Banks who "in turn" invested into other banks , who then put that (which was) solid cash into "Hedge Funds" also Known as Nothing . They Lost Everything OVERNIGHT !!! Now the (rightfully so) bankrupt cities want us to be "Sorry for them". DON'T . Change the Law to Elect Honest Judges Who Cannot serve unlimited terms and are Subject to Immediate "Recall Elections" ,as well as Your NEW Representitives and Goverment Officials . I'm tired ,but press on and THINK OF What we are Leaving Our Children and Grandchildren . No wonder they are have little repect for us and are angry . Shame on You ,Clinton , Bush , And Obama ! Alot to do but It starts TODAY ! ! Not what They call "Tommorrow".
Does anyone honestly think that the bombers or OBL cared about a money trail?? Their all DEAD! THEY GLADLY TOOK CREDIT FOR THEIR DEEDS.
This just smells like more BIG BROTHER. The government has been dying to get their hands on cash transactions for years. They could careless about the origin or the purpose of the funds, they just want to TAX-IT!!
The "machine", needs to have it's insatiable appetite for "more money" CURBED!
For the credit card companies and banks, its not about how the card is being used it's the fees associated with its use. Atm fees, retail fees, over limit fees, overdrawn fees, under balance fees, etc... They do not want you to pay on time. They want you over limit and under balance. Its their new business model to bleed your checking account and savings accounts dry. These prepaid cards are just another means to asses fees. See below article for just another example of fees being charged to increase revenue to prop up lagging sales, poor business models, and just plain greed.
http://money.msn.com/how-to-budget/10-fees-you-should-not-be-paying-kiplinger.aspx
Pre paid cards should be a basic tool for all who wish to protect their money. Use them on line or traveling and minimize the exposure of your debit and credit cards.
Enter Now the Homeland Security Administration . We are facing a problem which is not "NEW" as they scare Us into believing. We had Terrorists at the Turn of the century called "Anarchist's" Not even new techniques! Kegs filled with Dynamite and Nails , Lots of nails . Then in the late sixties and mid-seventies without losing our rights to prevent "unlawful search and seizures' we almost eliminated the "Hijackers." We Defeated Them Without losing ONE of our rights which took away Your Right to Own a Gun , Freedom of Speech , Free to Own and Decide for Yourself how and when to Spend Your Own Money Anyway You want . In Twenty Years We have allowed Presidents who not only "stepped on our own Constitution" but have defaced it into a worthless Document . Ever hear of the New No-Fly List ? If a ticket agent in the airport overcharges You and You even Politely contest the inaccurate charges but persistently with minimal Arguement , You are Instantly DETAINED and SEARCHED and then given a choice of a felony charge and JAIL or /and the No Fly List . You just Lost one of Your Constitutional rights to Travel ANYWHERE in this Country . That is on ANY AIRLINE . I use prepaid Debit cards to pay my monthly bills and to travel . I too have been WIPED OUT by unscrupulus service personel(traced back to them) so now thepre-paid card allows You to keep a certain amount of my money in a holding pattern for a "Cashless Plastic Society With out the risk of losing EVERYTHING . Identity Theft is a Felony, Worse, not ONE Law Enforcement person gave me the time of day to track down and convict the Creeps Who did it. I had to work for two Years and MANY countless nights to get Back NOTHING but to just stop losing what I worked hard for . How it was done ,(the crimes) were actually committed with the participation of BofA. Thank You HOME SECURITY ADMINISTRATION and BANK OF AMERICA I will forever remember the faces and names of everyone who told me '"Too bad, It's just my job.... to NOT help You.
Wow sounds like they really want to get rid of any private transactions, next step eliminate cash. Who needs privacy? Can any one argue only law makers have taken our rights? No terrorist could take my rights of privacy? They could not make it here without government help, they would be hunted and eliminated. If the rights of the Law abiding Americans right to bear arms were not infringed on those famous flights. Yes 911 would and could not have happened! Only citizens may own guns not illegal alien terrorists that were trained at us bases. What happen to building WT7?
Wow. More proof that the government will use any quasi-plausible excuse to grab power.
I mean:
(1) Who can argue at this day and age that the "drug war" has yielded anything but increased government involvement in normal citizens' lives--We're 30+ years in, the "drug war" certainly has done nothing to meaningfully stem the use of drugs or their flow across our borders (a dubious goal to begin with for many, many reasons that have been beat to death).
(2) Who can argue that this "War on Terror" has actually accomplished anything other than wasting trillions of dollars, thousands of US lives and hundred of thousands (if not millions) of foreign lives and destabilizing much of the Middle East and Eurasia? You might point to the assassination of Osama, but ten years had gone by before we found him and no new terrorist attacks in the US had occurred in that time--more of a mythical bogeyman living on the lam than a real super-villain.
(3) Who can argue that "the Department of Homeland Security" does anything other than spy on average Americans? Why do we still have this outrageous, expensive agency meddling in our lives? It's ridiculous.
Sheep, please stop and think. Despite the fact that (1), (2) and (3) above are undeniably useless, the government is now using them to justify further useless intrusions on your personal privacy and liberty, further regulations and further government expense. Cash cards? Really? Literally all they have to do is shout "terrorist" and you sheep herd right up.
I mean, they somehow snuck in the whole "you can't deposit more than $10K in cash a day without the IRS getting a call and you can't carry more than $10K in cash over the border without notifying the government" in on us--which is a blatant infringement on personal liberty. Now, they're going to track every cash card purchase? Meaning, if I buy my daughter a $100 Visa for her monthly allowance, the government's going to have a note on that somewhere or at least have access to said note. Some big-brother bureaucrat is going to have my name on a list? Outrageous.
Why is there no outcry? Wake up sheep. Please wake up. Think of how ashamed your great grandparents would be if they could see what you've allowed to happen to the US in the name of "security" you cowards. Take a lesson from Franklin, "He who would sacrifice essential liberty for temporary security deserves neither".
On second thought, perhaps you deserve what you're going to end up with--a crumbling empire that resembles 1950's Soviet Russia more so than it resembles anything previously identified as "American".
This is just another attempt at government controling people thru money. Eventually, the government will move away from fiat currency and force everyone to have a card to pay for everything so that another bureaucracy can track all of your spending habits, and also take you money if it sees fit to do so.
Yup! It's all about big brother control. Most in the fed govt don't care about our safety. One example is the crap the FDA gets away with as they allow very dangerous Rx drugs to kill thousands every year. In fact, Rx drugs kill more than prohibited ones. Cannabis has never OD killed any one. But they call it a narcotic...go figure.
Another is how they allow Monsanto to do their genetically engineered seed thing. No one knows how deadly this stuff can potentially be.
A third example is the lost & now deadly to civilians drug war. Any idea how many US citizens die due to botched drug raids by militarized police agencies? Even the DEA is guilty. Enter the term "innocent victims of the war on drugs". You will be most likely surprised, not in a good way. Very few cops who kill innocents get prosecuted. So we find that we have a new term for a lotta SWAT cops, Murder Inc. Oh, that one's taken...but we can lend it to the LEO agencies who get away with murder can't we.
Some one said something about how costly 9-11 has been. IMO that's big circumstantial evidence that the govt may have been in on it. That & how much control big bro now has over We The People.
What chaps my hide is that so called conservative Michelle Bachmann voted to extend the 'Patriot' Act.
Here is a small & IMO incomplete article from Freedom's Phoenix about the HUGE cost We The People have had to pay since 09-11. But it gets the ball rolling.
SamFox
How many people in America actually have more than $2000 on a prepaid card? Make amounts over that the restriction. I agree the fees will be passed on to the consumer to pay for this tracking. Your average America who relies on prepaid cards are least able to absorb additional fees. While they are at it why don't they just put RFID chips in every paper bill that makes it traceable to the individual for whom it was issued? Or require an official blue black fingerprint on every bill before you can submit it for payment Or ............ you get the point.
I agree. The solution is not to try and track the funds being placed on these cards. As the article points out, money could be put on these cards overseas where US laws and regulations do not apply. Since moving money from foreign sources into the US is the major issue for stopping domestic terrorism, passing regulations that only apply inside the US seems to be a somewhat pointless exercise. To stop the use of these cards for money laundering within the US, the best solution is to place a limit on the value of these cards. Cap the amount of money that can be associated with one of these cards at any one time. A limit of $2000 or maybe even $5000 seems reasonable. People that the article describes as being on the margins that do not have bank accounts are also unlikely to have more than that amount of money at any one time to put on the card. Limiting the amount that could be placed on a single card would make it much harder to use them for moving large sums of money. Of course someone could just buy multiple cards to get around the restriction, but this could be countered simply by requiring anyone selling these cards to keep a log of the people buying them. That would make it fairly easy to spot someone who is buying large numbers of the cards to move large sums of money. As far as stopping the movement of money internationally, the problem is far more difficult. The only thing that could be done would be to prevent US businesses and institutions from accepting cards that have dollar limits higher than the US regulations allow. Of course this would not prevent the criminals from sending say 50 cards with the lower values into the US. It seems like this problem is one that defies and easy solution. Other than banning the cards, I do not see much hope for stopping their use in moving large sums of money into the US.
Look in this hand....see it, don't turn away...keep looking. BAM!!! gotcha with the other hand.
Look at what the gov't is saying here. Keep looking hard enough, and you might see it is not about terrorists at all, it is for other reasons. Once you start connecting the dots, it will get a little brighter...trust me.
These cards are also favorites of illegal immigrants and "straw" weapons buyers. Some are some what innocent, such as the illegal sending money south of the border to help out remaining family there. Others, not so much, as cartels buy them or get ones that are send in the guise of money being sent by a loved one from the US and simply reload them in Mexico and elsewhere. The straw buyer then can use them for the purchase of guns to be shipped back to cartel members.
Yeah, kinda like Fast and Furious sponsored by...now wait for it...here it comes...the government, and that resulted in at least one American death.
Gotta love the way they "protect" American citizens.
I think you would be surprised how many people put more than $2,000 or even $5,000 on these cards. I know I have as I have used them to take along on vacations with me. I have done so mostly for the sake of simple safety. If I lose my ATM/Visa card I expose my entire bank account. If I lose a prepaid, I am limited to what I have on the card.
Putting a restriction/cap on the card as you say won't stop someone from getting multiple cards. You didn't for a minute think the people getting these cards have only access to one identity, right? Like all terrorists nicely will use their real names etc. It will however hinder those who have no illegal intent with the cards. Capping them will be about as fruitful as stricter gun laws which never stop criminals from acquiring weapons, lower BAC levels which will never stop drunks from still driving etc. In other words, it will be totally useless.
In fact it will simply become yet another case of limiting what you can do with your own legally acquired funds. You can't go cash a check for over $10K without the IRS being informed. You can't carry around cash without being suspected of being a drug dealer. Even having nothing to hide it becomes an intrusion simply because of an alleged "need to know" by the government.
"The net impact of these rules would be an increase in the overall cost of debit cards for consumers for record-keeping and storage and so on that will eventually trickle down to fees on the debit card and a limitation on features," Anand said.
I have never read when the law enforcement made an arrest they found $XXX$$ prepaid cards. Drug dealers are using cash for transactions not Prepaid card! Duh!
More regulations! Geez! the innocents (like myself) have more paperwork and explaining to do. First it was the terrorists now it's the drug dealers causing this looniness by Govt.
You know we do have RFID chips in bills 20$ and over right? This has been for like 5 years or more
Hey Believer-123, how about the "Fast and Furious" that resulted in 4000+ Americans being killed in Iraq?
@ Sally in Chicago
Didn't know you were an expert in drug dealings. Did it ever occur to you that they could sell their drugs, buy these card, take them across the border, and cash them in?
I say make them illegal here in the U.S. because there are illegal aliens working under the table and buying these cards so they don't have to carry cash. They are the same as money but nobody knows how much money they have. If you have no address for a bank account then you probably don't have enough money to worry about.
Been watching too much "prisionplanet" I see. There is no RFID chip in American currency but they do have an embedded strip that shows it's denomination.
http://urbanlegends.about.com/b/2004/03/02/rfid-chip-in-new-us-20-bills.htm
Larry, Snikt will not be able to hear you. The tin foil rapped around his head keeps out all incoming messages. Besides, not to worry, we can track him with the chip I inserted under his skin while he was sleeping.
"actually have more than $2000 on a prepaid card?"
I actually had a Meijer Visa Prepaid card for a while before the monthly fee and "put money on the card" fees caused me to abandon it. I think there was something in the contract saying you could avoid at least the monthly fee by maintaining a $1,000 balance on the card. So having $2,000 on the card may not be all that unreasonable.
This would be unfortunate. My wife and I use these a lot for large purchases.
Our bank will not give us credit cards (for several reasons, none of them illegal), and our debit cards have a rather small limit on them (for our protection of course). If we want to purchase larger items (home appliances, computers, vehicles) we need a secure way to transport the money to the store. If we want to make a purchase online, we need to have a means to pay...
I'm buying a $20,000 tractor next week, how else would I transport that much money to the dealership?
Hey a----rand,
Just because someone wants to use a pre-paid card so their purchases are not tracked by every alphabet soup agency in the Federal Government does not mean they are trying to hide something. That's always the lame reason, "Why do you care if the police search your car if you aren't hiding something, you have nothing to fear" Sounds like the same things the NAZI's said pre and during WWII.
Its called right to privacy. I may not be doing anything illegal (according to the laws today, buying ammo, buying and stocking food) that tomorrow may be seen as terrorist activities and become the focus of some agency's SWAT team. Wake the hell up! DHS has already label Christians, Homeschooolers, Gun Owners and returning Vets as potential domestic terrorists. I really don't want them to know what I buy or how much.
Everyone who thinks this is just about tracking the bad guys, walk to your bathroom mirror and look into it. Your Federal Family sees you as a potential bad guy! No go get a cup of coffee!
Always amazes me how easily Americans are willing to give up their rights under the guise of security!
Find the money, Tax the money!!!!!!!!!!!!!!
Sound idea. But, the Feds need to be able to track the purchasers of unidentifiable Trac Phones also. One of the 'weapons' of choice for, not only communicating with other terrorists, but for setting off timed explosive devices to coordinate multiple explosions at the exact same time.
People use prepaid debit cards because they don't want the hassle of opening a bank account, the bank's ridiculous fees for EVERYTHING, or they had a bad experience in the past. ALL prepaid phones then should be tracked by the serial number and purchaser name when they're bought. I have an in-law that buys prepaid phones every chance he gets for his illegal alien relatives to do god knows what with them. Since they can't be traced, the FCC has a "whatever" attitude.
Besides, with regard to the prepaid debit cards, many employers are encouraging direct deposit of payroll, and either issue a debit card, or in some cases, like the EDD in CA, you get issued a card for your benefits. Hell, even the US Government is issuing benefits through cards now, so I don't know what the problem is.
The government needs another "play thing" like they did with baseball, that's all. They need another distraction and/ or diversion from doing their REAL work which they were elected to do in the first place.
I don't see what the big deal is, we want government transparency and the government wants citizen transparency. It's not like there's anything in our constitution about individual privacy...wait, what country is this? I've forgotten over the last couple years =P
Anybody who supports this should lose their citizenship. Enough already, stop spending my money to look at prepaid credit cards on the off chance that "something nefarious" might be going on.
Please identify your city so that we can direct the terrorists in your direction. When you have lost family, relatives and friends will you still feel the same? Try a little compassion.... One of the key purposes of the government is to defend the country and protect the people. While they have not always been on point with this, I would rather they be trying than simply letting things happen. Following your logic, we should open the borders as well. Why waste money trying to catch drug dealers, arms dealers, and people trying to sneak into the country....
Enough already. I want to live my life without the government being able to track my every move. I have nothing to hide, but where does it stop? Why don't we just implant everyone with a chip to track our whereabouts at all times? It seems Orwell wasn't too far off was he?
"Those who would give up essential liberty to purchase a little temporary safety deserve neither liberty nor safety" BenFranklin
I can't believe people are falling for this crap.
Maybe a dose of your own medicine would be in order.
How many people were killed in America by terroristin the last 7 or 8 years? How many people were murdered in America by Americans in the last 7 or 8 years? The last thing I'm worried about is a camel jockey half way around the world.
skubiak, I have lost people so let's talk. I have served my time in the military and feel I've earned the right to a bit of privacy and anonymity in this world. You fear mongers are so far out there it's insane. This is 'protecting our country', really? In what way? You can't sleep in your own bed at night without the knowledge you may get robbed, beaten, killed, or raped because money and resources are wasted on ludicrous shenanigans like tracking prepaid cards. But either way you're fine with them tracking your every movement. Freedom at any cost isn't freedom - do you not understand that? You're willing to allow the government to take everything from you for the sake of this imaginative 'freedom' and safety you hold so dear. What happens when someone in power dislikes you, your thoughts, your party alliances, you political ideas, anything. What happens when they decide to illicit more control over people because they 'feel' it's good for the country or because they're scared of a revolution or an attack by a foreign power? They decide from that that anyone with your thoughts or ideas is an imminent threat. Now what? You throw out the scenario of having someone die in a terrorist attack and say we should give up our freedoms and rights - well then answer those questions. What happens when we allow your idiotic scenario to play out and it goes to hell, like it always does in America?
By the way, have you ever read a book? Something like '1984'? You ok with that idea? Why not, let's allow the government to know the thoughts in our heads. After all, what better way to know who's a terrorist and who not than to listen to their most private thoughts. Reading minds could be a wonderful tool!! Let's put a reader on every street corner in America!! Safety at any cost is the way!!!
The government (big brother) does not need to track every dollar I spend. I hate it that there are no $500 or $1000 bills. After all, a $100 bill will buy what a $10 bill used to buy and $100 isn't that much anymore.
$100 will get a dealership to open the hood of your car or pay for a routine office call at a doctor's office.
It reads as though anyone who is for NO REGULATION. Is part of the problem and has something to hide.
Could that be MONEY, our SMUGGLING?
Please GO DIRECTLY TO JAIL AND GET SEARCHED!! What are you HIDING???
Angry
Unless you are one of the buyers, it won't be "your money". The rates for purchase and usage on these cards are being raised.
skubiak asks about open borders and people sneaking into this country.
What exactly is it about that question I find so insulting? Could it be that as a law abiding, FREEDOM loving, AMERICAN citizen I resent anyone including the ever expanding government minions and snoops trying to insert their noses into my business while ignoring existing laws?
Skubiak- have you ever heard the faze, and the sheep shall fallow , you are the kind of person that sit down and really believe's what they are saying on the news , watch it ,The sky is falling ,They just said it on MSNBC. Chill out , I for one do not think we need anymore Regs. added to what we have now , besides the Goverment will have to hire 500 more worker's to try and run it , so we end up paying the handling fee and more tax money going to pay for more Goverment workers . Just say NO , to more B S reg's !!!
I'm with Angry American here, as well as John Doe, and Almighty Dollar. And I am Very suspicious of the true motives of the government for wanting to control prepaid cards. I believe that our Banks have more to do with the plan myself. As "Where's Waldo" stated, what about the trak phones? And what about the fact that money launderers can add to the cards in other countries. This is yet another attempt of the Ultra rich gaining control of all of the money here in the U.S. This is just EVIL and out of control.
Thank You "Dave" for posting the quote from Ben Franklin, I will also post this again here.
The purpose of the federal gov't is to protect the nation and its people. The purpose of the government is NOT to CONTROL the nation and its people. The elected and appointed government should have a healthy fear and respect for the people that live here. If the government has total control of our money and what we can own (guns/ammo for example) there will be no fear or respect and then there will be total control....that equates to no freedom. Tracking all finances would be a truly effective way to track terrorists....as would mind readers on every corner....pick your poison...I choose freedom at a cost of threat from terrorists rather than tyranny/socialism with the threat from our government if I don't fall into line.
Here we go with the comments of dumb asses supporting more government spying. Do away with the war on drugs. The government doesn't need to track people's purchases nor does it need access to such information. In fact, let's not stop at the war on drugs but let's do away with a BS government that now believes arbitrary power is really not tyranny and along with that you saps supporting every infringement on freedom they come up with needs to GTFO too.
Love many of the posts here. Remember that no one, except for the federal government of the United States, has the power to take away our freedom. Iraq? Afghanistan? The Taliban? Al Queda? Not a chance. Terrorists can make us afraid to exercise our freedom, but the cannot take them away, only our own government can do that. When elected or when joining the military, a police agency, the FBI, whatever, people take an oath. That oath is not to keep us safe or protect us from terrorists. They swear an oath to protect and defend the Constitution of the United States. They should try to remember that as they continuously tighten the reins on the liberty of American citizens.
Wake up everybody. All this is blatantly unconstitutional!
Where in the Constitution is it that the "Federal" government is granted authority to (using what is plainly an unconstitutional standing army), encroach, with impunity and no reasonable cause, into the privacy and personal effects of persons, not in service of the Federal government, and regulate money and purchases of any form within the jurisdiction of any of this Union's 50 sovereign member States?
And, contrary to the fundamental purpose of UNION and the purpose of the Federal government to PRESERVE the State governments and NOT govern individuals (June 27th in Convention), where is it that the Federal government was granted power to (plainly contrary to the whole works of the convention and the 10th Amendment) instead govern individuals and encroach on the States, usurp all remaining powers reserved to them, interfere with them and commit aggressions against them with such blatantly repugnant unconstitutional lawless tyrannical nonsense?
Hundreds of thousands of dollars are going south across the borders every day by people who are supplying drugs to our children. Cut off the money supply and put a big dent in the drug cartels operations.
Make them unable to accept foreign funds and illegal to transfer funds to outside of the US. The Mexican illegals are using them to send money out of the US to their relatives. If they could not do that then the couldn't be sending their ill-gotten gains home to their own country. Limit the funds too but remember that these cards are being used here in the US by a lot of people who do not have bank accounts and have their paychecks automatically debitted to them........Social Security and Disability are also paid to them. The real factor is proving who has the cards not how much is on them and if they are in this country legally.
Ok, clearly you have not thought this through. What would be the impact to businesses (most operate internationally today)?
They found a new tax avenue or a better way to waste taxes. Your choice.
If an organization is put together to create jobs for Americans to monitor and track these cards okay, but most likely these tasks will be be outsourced to Peggies outside of our country and thus continuing the downfall of our economy which makes illegal activity so inviting in the first place!
Hey, you know what ? Every time the public gets something good , "THE BAD GUYS HAVE TO FC%*K IT UP FOR EVERYONE!!!! lets do away with BAD GUYS!!! lets shut CREDITS, DEBIT CARD, MONY CARDS, PREPAID CARDS, go back to basic befor there were "CARDS AND CHECKS,"CASH ONLY!" then the FED"S & LAW ENFORCEMENTS wont have any more "HEADSCHES!".
Not a bad idea, but government cannot stand the idea of a private citizen actually having cash. Might not be able to confiscate, oops redistribute, it you know.
Interesting word "cash" Now lets start spelling it correct. "Cache" . Sounds pretty darn close. Websters says "a place for preserving provisions or implements". I'm broke but if I had any ching I would want it in "Cold Hard Cache" Some gold cash for me please. Back when a dollars a dollar. Before money grew from trees.
just another example of the homeland security state
Cash is what terrorists and criminals use as it can not be traced. This is just another way of the Tyrant Nazi Gestapo US Government way of knowing everything you buy sell, or trade. Control is the key issue.
The largest terrorist organization is the US Government.
when people start giving up their freedoms in exchange for safety, they end up with neither.
You know, I can understand kinda the need for this but you're right, it really seems like the moron's in government are using the so called terrorism excuse for everything. I'm not sure really which is worse, the fact that they use it or the fact that so, so many people buy into it and support it.
We know how much good it did that they tracked the 911 hijackers. So that's clearly just a cover. What this amounts to is that they want to be able to block you from taking your money out of the country once they start confiscating assets to pay off the bailouts of Goldman Sachs. This is a loophhole they needed to close to complete the net.
AMEN, Krakondack!!!! There you have it!!!!! It is all a matter of the Ultra rich getting richer. And bringing down the regular guy, the middle class. Some day soon, we won't even have a middle class, it will be the super rich and the super poor.
I really wish I was born fifty years ago. This world sucks.
tell me about it. i thought i was free when i was a kid.
?
Maybe I just don't think the government needs to know how I spend my money. Today, Americans don't trust their government, for good reason, and the government don't trust average americans. Personal freedom, (liberty), is eroding away in the United States. Since the so called "Patriot Act" big brother has steadily encroached on personal freedoms under the guise of defending against terrorism. I say that the government should back off this thinly veiled attempt to squeeze more tax revenue out of honest people.
You get my vote for president. Not that any decent American would want the job.
no matter what they do the bad guys are always going to exploit every resource available to them. the government simply cant keep up
Instead of screwing around with the privacy rights and freedoms of Americans, this administration should enforce the immigration laws. 9-11 would not have happened had our government enforced immigration laws but in reality, these people, as well as millions more, should never have been given visas. While many come here illegally across the porous borders, many come here legally thru our lax visa programs and then just dissappear. Clearly our government is unable to keep track of everyone that comes here and has no idea where they are once their visas expire. The idea of people coming here on student visas etc is ridiculous. Do we really need to educate the world? If they have family here they want to visit, let the families visit them in their dirt caves. Either protect our boders or get the hell out of the way so others can do so and quit fighting for the rights of illegals in this country.
I just LOVE that you guys report this stuff. You're tipping off the people we're trying to protect ourselves from. If you were working for the terrorists, you would be announcing the very same information.
I agree! Those terrorists who hadn't realized the error in their ways now have it clearly explained to them...
@Crying Wolfe
Oh please, give me a farkin' break. Go back to reading 1984 - it's your version of a Bible and you won't be happy until it's implemented. Let us adults do the thinking - it's ok, we know it hurts when you do it.
The 911 hijackers were only traced after the event. While it is nice to know who did it after it happens, making it harder to move untraceable funds isn't going to stop determined men from carrying out their plans.
Or women for that matter - I don't care how they track her spending her money, if she's gonna cut off your Johnson, she's gonna cut off your Johnson!
really people this is total BS the whole thing it a joke , you know if people would stop and think we are getting played. terrorists my A## it is all about power and control by the Government. think about it they are so worried about bombs and a terroist getting their hands on the stuff to build them yet you can buy all kinds of high powered fireworks, even half sticks of dynomite, and the shells that set off car alarms . wrap nails, or ball bearring arong them and that is a nasty bomb in a crowd. and you know people have all ready thought of it. so why hasnt it happened? come one people stop the crazy BS
Bet you own a company of the Terrorists Cookbook don't ya? lol
@skubiak
So what if they do? It's a free country, for now. Try to remember that sometime, hopefully not before you're being dragged off to the gas chamber for finally disagreeing with the Government.
@skubiak
You keep posting in favor of these laws. Have they already brainwashed you? It's started hasn't it...1984?
Laws like these are designed for one thing only...to control the population. These laws will not do anything to protect us from terrorists, there's always a way around them. Even the article says they can do nothing about the foreign bought cards. Think about it for a minute...only the cards bought in the US
Then the face of Big Brother faded away again and instead the three slogans of the Party stood out in bold capitals:
WAR IS PEACE
FREEDOM IS SLAVERY
IGNORANCE IS STRENGTH
skubiak had one too many scooby snacks
A couple of months ago someone blogged that they where in a store in San Francisco and 2 Islamic women where in the checkout line in front of him and were buying the store out of prepaid cards. I think this idea of being able to send money to anywhere in the world definitely needs to be traceable also I am wondering how it is the illegal's in this country are able to survive if they can't work and this makes perfect since to me. They are receiving prepaid cards for drugs and the cartels are cashing them in on the other side of the border. We need to stop this sh#t now. The United States Government owns all the bills/currency and should be able to tax it as required by law and because it is property of the United States Government (American's) there is no reason why it should be in the hands of someone that is here illegally. It should be considered theft of Government property if they get caught with it in their possession.
So they get some homeless person to purchase the initial card for them and then they can reload it over and over and all they'll have is this homeless person to track?
There's just so many ways around this.
.
I agree this country is no longer "land of the free and home of the brave"
Lets just chip away some more at those freedoms we used to have.
Wow, who would have thought, something new the government wants to track that many people are starting to use, and imagine that, it has to do with...........money. Oh, the shock and surprise of it.
Again:
"Those who would give up essential liberty to purchase a little temporary safety deserve neither liberty nor safety." ~Benjamin Franklin
Keep a look out folks; It's happening all the time. People are blithely giving up their civil liberties every day, and what's worse, the government is more than happy to help you help them liberate your liberties from you.
Remember: Just because a certain new law or amendment doesn't affect you personally in a negative manner does NOT mean it doesn't open the door for a law or amendment to later affect you in a negative manner.
Wow!...there goes half of Obama's 2012 campaign contributions...:p
Yet another freedom given up to gain security. Thomas Jefferson is doing another flip in his grave.