The circumstances surrounding the fall of New York Gov. Eliot Spitzer is illustrative of how much liberty has been lost in the United States today. It seems that Spitzer’s monetary habits drew the attention of federal law enforcement to his sexual encounters. While I in no way condone unholy living, neither Spitzer’s sexual behavior nor his money habits were any business of the federal government absent evidence that they affected his governance of the Empire State. I have read none.
Currency controls are found in Title 31 of the United States Code. Rather than protect the financial privacy of depositors, the Orwellian-named Bank Secrecy Act requires financial institutions to disclose a number of specific cash transactions to the U.S. Treasury Department. This is how Spitzer came to the authorities’ attention. His bank alerted the Internal Revenue Service of several such transactions, according to reports, which led federal authorities to investigate and, ultimately, discover the prostitution ring. Title 31 regulates the use of currency within (and without) the United States. Any cash transaction of $10,000 or more must be reported by a financial institution to the IRS, and any “questionable financial activity” must be reported to the Treasury Department.
Trying to evade the reporting requirements carries hefty penalties. For example, Spitzer may be charged with what’s known as “structuring,” wherein someone attempts to get around the requirements by making multiple withdrawals of $10,000 or less, or, for example, by masking withdrawals in the form of cashier’s checks. The penalties can be severe — civil fines of as much as $100,000 and a felony conviction with a maximum term of five years in federal prison. Under the Patriot Act — also inaptly named: the true patriots were those with the courage to vote against it — the zeal of fighting money laundering by a banking official is a legitimate issue to raise in a job reference from a former supervisor about that official.
Hence, there is extreme temptation for bankers to, in effect, inform on their customers. It was not always so: Particularly onerous Treasury regulations proposed in 1999 called ‘Know Your Customer” were beaten back by Congress in a victory for Rep. Ron Paul, who is now a presidential candidate. Alas, many of the rules adopted in the Patriot Act were identity requirements made into law. There can now legally be no secret accounts or accounts under an assumed name in the United States.
The financial surveillance is only just the beginning. There’s also the passage of the Real ID Act of 2005, which sets new security and authentication procedures and forces states to register driver’s licenses and state identification cards into a national database for so-called official government purposes.
Real ID is not really an identification system at all. Identification has long been a state and local issue, but after 9/11 there were some necessary changes made to the verification process of those seeking an official state identify card such as a driver’s license. Virginia adopted a legal-presence system, in which driver’s license applicants must show the Department of Motor Vehicles proof of citizenship. However, the federal government wants to have an identity card combined with federal access to the state databases to ensure access to federal buildings, airplanes and nuclear power plants. This is a threat to liberty and privacy on several fronts.
CNN reported on Aug. 16 that the Department of Homeland Security admitted there will be “interconnected” federal databases under Real ID, not to mention bar codes on the cards used for surveillance. The government could eventually require the cards to be presented at pharmacies for over-the-counter prescriptions, for example, or other uses that would have little to do with homeland security.
It certainly is feasible that in future bank accounts, gun sales and purchases as well as general commerce might require Real ID cards. And neither the private sector nor the federal government has been exemplary about preserving privacy or preventing misuse of information. Just ask Sen. Barack Obama, whose passport file was rifled. Ask the millions who have received letters from government agencies or companies saying that laptops or computer files were stolen and your Social Security number may be compromised. Or maybe ask former Gov. Spitzer. The combination of currency controls and Real ID is a temptation to adopt a surveillance society.
Which brings us to Gov. Brian Schweitzer of Montana, who has led the nation in a great fight worthy of the mythical Sen. Jefferson Smith. Montana took the position that Real ID is intrusive and not necessary for national security, and Montana passed a bill preventing the state from participating in Real ID. “We recognized that Real ID was a major threat to the privacy, constitutional rights, and pocketbooks of ordinary Montanans,” Schweitzer wrote in a letter to fellow governors.
Schweitzer called on other states to follow his lead. According to CNN, other states have, independently of Montana’s call or not, also defied Real ID, including Idaho, Maine, New Hampshire, Oklahoma, South Carolina and Washington.
Other states have started the process: One house of the Missouri Legislature has passed a resolution calling on Congress to abandon Real ID. Gov. Tim Kaine has taken a contrary position, indicating he is “not opposed to Real ID,” says spokesman Gordon Hickey: In other words, since Real ID is a federal act, the state has no choice but to follow it.
It is well past time for Virginia to follow the lead of Montana and other states and defy the Real ID Act. Once civil liberties in the United States are lost, they can never be reclaimed. Who will be affected? The usual suspects: political and social activists, people of faith, along with educators, artists and writers. Let’s start today with financial privacy and Real ID to reclaim the constitutional republic. The ultimate fate of a world without financial privacy was stated nearly 2,000 years ago, in the Bible, Revelation 13:16-17: “He also forced everyone … to receive a mark on the right hand or on his forehead, so that no one could buy or sell unless he had the mark.” Financial privacy, civil liberties and national sovereignty must be an essential part of any constitutional republic. S
Elwood Earl Sanders Jr. is a Richmond-based attorney who has written several scholarly legal articles, including one he co-wrote on the effect of the U.S. Patriot Act on money laundering and currency transaction.
Opinions expressed on the Back Page are those of the writer and not necessarily those of Style Weekly.
