Pubdate: Thu, 04 Feb 1999 Source: Times Union (NY) Copyright: 1999, Capital Newspapers Division of The Hearst Corporation Contact: http://www.timesunion.com/ LEGISLATORS ARGUE FOR BANKING PRIVACY WASHINGTON -- Citing complaints that new rules could turn every bank teller into a cop, some House members are proposing legislation aimed at protecting the financial privacy of Americans. The legislative package announced Wednesday by Republican Rep. Ron Paul, R- Texas, would block proposed anti-money-laundering rules that would track the habits of bank customers. Paul said about a dozen lawmakers, including House Republican Whip Tom DeLay of Texas, are joining him as co-sponsors of the bill to stop the "Know Your Customer" rules. Privacy advocates, conservative groups, ordinary people and bankers' themselves have complained that the rules would make every bank teller responsible for doing the job of the police. At least two federal banking agencies are reconsidering the rules in response to the public outcry. The Federal Deposit Insurance Corp., for example, received more than 14,000 e-mail messages and letters opposing the proposal as of Friday. The Office of the Comptroller of the Currency also is looking into the situation. "We proclaim that American citizens have the right to be free of the snooping, spying, prying eyes of government bureaucrats," Paul told reporters. The proposed regulations would require banks to verify customers' identities, know where their money comes from and determine their normal pattern of transactions. The current requirements for banks to report any "suspicious" transactions to law enforcement authorities would be expanded. Two other measures in his package -- to repeal the Bank Secrecy Act and to let people see files on them created by the federal Financial Crimes Enforcement Network -- have not attracted co-sponsors, and its legislative prospects were clouded. The Bank Secrecy Act of 1974 obligates banks to report customers' cash transactions of $10,000 or more to law enforcement authorities. Paul said the law has failed to catch drug dealers, who "are smarter than most bankers." Paul, a physician who is on the House Banking Committee, contends the "Know Your Customer" rules violate the Fourth Amendment prohibition against unreasonable search and seizure. - --- MAP posted-by: derek rea