Banks, Privacy and Revenge
Eliot Spitzer made a name for himself attacking banks. Setting aside the legitimacy of those attacks, I find it shocking that he didn’t realize how much banks know about each one of us [link to http://blogs.zdnet.com/BTL/?p=8211 no longer works]. It’s doubly shocking that he didn’t expect revenge.
The New York Times claimed that the “Revelations Began in [a] Routine Tax Inquiry.” I wish we had better insight into how true that is. In perhaps closely related news, “Fraud Police Buckling Under Mountains of Data” [link to http://www2.csoonline.com/blog_view.html?CID=33196 no longer works]. So what kicked off this routine investigation? Was it data or voyeurism?
What does a guy need to do to get a little privacy in this country, anyway?
Word I hear is that it was a revenge attack, long expected. The feds have been gunning for Spitzer for a long time, he has made them look stupid for so long that it couldn’t be allowed to go on.
I don’t buy the whole ‘revenge attack’ or ‘gunning for spitzer’ theme. The simple fact is that he did a number of really stupid things. The way he was moving money around was highly suspicious for anyone – let alone the governor of New York. It doesn’t take a genius to understand that someone somewhere would open up an investigation into this. Personally I am happy that Spitzer is gone – the guy was a thug.
And as for the whole ‘little privacy’ question. I am not sure if that is a joke or not. I suspect not. You give banks that information. You buy stuff via credit cards connected to their network. You pay for heating bills via systems connected to their network. They know where you work because you give them that information when you apply for a mortgage. And on and on. I am a bit perplexed as to why it took this event for you to realize that “hey – banks know alot about us!”.
Can’t tell from the press reports to be sure, but it sounds like there was a Suspicious Activity Report, which all financial instituions are required to file with FinCEN. SARs are used for a wide range of things, not the least of which is to detect “structuring.” As you may know, the “war on drugs” spawned a limit of $10,000 of cash that must be reported. Since everyone knows that $10,000 or mor in cash must be reported, people do smaller transactions, hoping to stay under the radar. But structuring is also illegal and will usually generate a SAR.
I read that after wiring the money, he called his banker and asked that his name be taken off the transaction. An amazing thing to ask a banker to do. Mind-boggling, IMO.
The same article goes on to say that while millions of SARs are generated per week, “an analyst at the regional IRS office in Hauppauge noted Spitzer’s particular SAR and singled it out for attention to criminal investigators”.
Whether this singling out was due to (perfectly legitimate) concerns that Spitzer might be being blackmailed or extorted from, or whether it was motivated by spite, revenge, persecution due to Spitzer’s political views, etc. is something we probably cannot know, but the explanation which does not involve a conspiracy or bad faith is certainly the simpler one.
What “a guy does to get privacy”, seemingly, is use a friend’s name when he goes cavorting with hookers. Outstanding!
What I find flabbergasting is that Spitzer — a former state attorney general for the love of Elvis — made the calls to and from the escort service from his personal cell phone. Was he never involved in a wiretap operation in his entire career as a prosecutor?!
Considering that he was paying upwards of $4000 a night for company, an additional $40 for a disposable prepaid cell phone seems like a tiny price to pay.
Yeah, Doc. I am not impressed with Eliot’s tradecraft, either.
On the POSIWID blog (“Poetic Justice”) I commented on the ironic downfall of Eliot Spitzer, and quoted Laura Trevelyan who compared it to Greek tragedy.
I am always astounded by the things people expect to get away with. Is it sheer arrogance, or an unconscious desire to be found out? I think there are often people who unconsciously engineer their own downfall. Sigmund Freud (who certainly knew something about Greek tragedy) called this the death drive. Sometimes there is no other obvious explanation for people’s self-destructive behaviour.