FDIC RECONSIDERS BANK REPORTING PROPOSAL

WASHINGTON -- Faced with a torrent of criticism from citizens worried
about privacy, at least one federal banking agency is ready to
reconsider a proposal for anti-money-laundering rules.

The nation's bankers, along with a chorus of people and groups, have
urged federal regulators to withdraw the proposed rules, warning that
they could make Americans lose confidence in the banking system.

"We're going to have to do something different. . . . We can't leave
it as is," said Christie Sciacca, associate director of supervision at
the Federal Deposit Insurance Corp.

She said the FDIC, one of several agencies that proposed the rules, is
considering a range of options, from loosening them to dropping them
altogether.

Proposed regulations, dubbed "know your customer" rules, would require
banks to verify customers' identities, know where their money comes
from and determine their typical pattern of transactions. The current
requirements for banks to report any "suspicious" transactions to
law-enforcement authorities would be expanded.

The plan is designed to combat money-laundering techniques used by
drug traffickers and other criminals to hide illegal profits.

Privacy advocates and ordinary people have complained that the rules
would transform every bank teller into a cop.