GROUPS PLAN CAMPAIGN AGAINST BANK SECRECY ACT

Flush with their success in forcing regulators to drop proposed rules on
tracking bank customers' habits, civil libertarians and other groups are
organizing a big e-mail campaign to end reporting requirements for cash
transactions.

Law enforcement authorities, in response, are warning against any weakening
of the Bank Secrecy Act.

Officials of the Justice and Treasury departments and the U.S. Customs
Service told Congress last week that the 1974 law is an essential tool for
detecting and prosecuting money launderers and drug traffickers. They
testified at a hearing of the House Banking subcommittees on oversight and
financial institutions.

For example, the Customs Service says it used about 80 suspicious activity
reports filed by banks under the law to identify bank accounts of money
launderers targeted in Operation Casablanca. That enabled Customs agents to
locate suspects' assets that were seized and forfeited in the 1998
operation, the biggest drug money-laundering case in U.S. history.

Far-reaching legislation pushed by Rep. Ron Paul, R-Texas, would repeal the
Bank Secrecy Act, which requires banks to report customers' cash
transactions of $10,000 or more, as well as suspicious activities.

The law is designed to combat money laundering techniques used by drug
traffickers and other criminals.

But Paul maintains it violates the Fourth Amendment prohibition against
unreasonable search and seizure and that, at any rate, it has failed to
help catch drug dealers, who he says "are smarter than most bankers."

The Libertarian Party, the American Civil Liberties Union, privacy advocacy
associations and other groups are mobilizing to generate support for Paul's
bill.