I was reading an article about cash reporting requirements in the US where they state that any transaction that involves over $10,000.00 in cash must, by law, be reported to the Federal Government.

The rationale spun to us is that the government wants to know who might be involved with criminal and/or terrorists who frequently launder money through the financial system. The claim is that perpetrators deal in cash transactions and large ones as there is no paper trail, like the $300,000 (CDN) that Brian Mulroney accepted from Karlheinz Schreiber. Mulroney of course denied it at first, then admitted it. Ooops! We were talking about terrorists, right?

Other than the problem that cash is state issued fiat, it currently can be used for private transactions. There are no third parties involved. The transaction is not entered into a database somewhere, where there are triggers or stored procedures coded up that sweep the data with criterion of what might be suspicious. If I want to, I can negotiate with anybody I choose, pay them, or they can pay me, and it is nobody’s business but ours.

This activity of tracking transactions is not so much as a protectionist measure against criminal activity as it is laying the plumbing to eventually have all transactions reported to the government in an uber-database, where there tax departments have minute detail as to how much you make, spend, and save. If you accept cash outside of your revenue stream and spend it on something, the government will eventually know that you spent more than you reported. Paranoia? We are well on our way.

This sparked my interest to find out what laws are in place in Canada for similar activity. So after some fine-tuned searching on Google, I stumbled across the Canadian government site: “Financial Transactions and Reports Analysis Centre of Canada” a.k.a “FinTRACC”.

From their website:

The Centre was created to detect and deter money laundering by providing critical information to support the investigation or prosecution of money laundering offences. In December 2001, this mandate was expanded to include the detection and deterrence of terrorist activity financing.

More specifically, FINTRAC’s mandate is to:

  • receive and collect reports on suspicious and prescribed financial transactions and other information relevant to money laundering and terrorist activities financing ;
  • receive reports on the cross-border movement of large amounts of currency or monetary instruments;
  • analyze and assess the information it receives;
  • provide law enforcement financial intelligence that would be relevant to the investigation or prosecution of money laundering offences and terrorist activity financing offences as well as to provide CSIS with financial intelligence that would be relevant to threats to the security of Canada;
  • ensure that personal information under its control is protected from unauthorized disclosure;
  • ensure compliance by financial intermediaries and other reporting entities with their obligations under the Act and regulations; and
  • enhance public awareness and understanding of matters related to money laundering and terrorist financing.

Wonderful. I feel safer already. With the government looking out for me, for my own safety of course, I can sleep soundly at night knowing that we have yet another government department under new mis-management costing me more and end up like another gun-registry boondoggle.

Nevertheless, swallowing my rising bile and pervasive disgust, I dug in a bit more. Specifically the part about cash reporting requirements and what rules of governance the banks must adhere to. I found the appropriate section and reprint it below, with my comments in the appropriate red colour:

4.4 Cash Transactions

  • Client starts conducting frequent cash transactions in large amounts when this has not been a normal activity for the client in the past.
    • As opposed to longstanding clients who do frequent business in large cash transactions. In otherwords, existing terrorists and/or drug lord clients aren’t suspicious.
  • Client frequently exchanges small bills for large ones.
    • Paperboys frighten me too.
  • Client uses notes in denominations that are unusual for the client, when the norm in that business is much smaller or much larger denominations.
    • Careful that you don’t change jobs.
  • Client presents notes that are packed or wrapped in a way that is uncommon for the client.
    • Ensure you use the same packaging.
  • Client deposits musty or extremely dirty bills.
    • Please put Grandpa’s dollars he collected in his basement back.
  • Client makes cash transactions of consistently rounded-off large amounts (e.g., $9,900, $8,500, etc.).
    • Careful that you don’t hold back the change or a few dollars for your cash kitty. Ve vant full disklosure.
  • Client consistently makes cash transactions that are just under the reporting threshold amount in an apparent attempt to avoid the reporting threshold.
    • Wouldn’t you? Next time I am at the bank depositing a large amount of cash, I will say in a loud voice, “I am depositing a large amount of cash! What is the amount I have to deposit in order to invade my privacy to trigger a report to the government?!?! ” When the teller informs me (or more likely, has to ask a supervisor who won’t know either, then the asks the branch manager, who won’t know, who will call it into head-office and wait for the answer. When the answer finally comes (which I already know of course), I will deduct the amount of cash from my deposit and say, in a loud voice, “Good thing I am just under the reporting requirement, otherwise I would be flagged as a drug lord or a terrorist, instead of a Canadian just concerned about his privacy!”. I know it won’t accomplish anything, but it might make the lemmings in the bank think a bit.
  • Client consistently makes cash transactions that are significantly below the reporting threshold amount in an apparent attempt to avoid triggering the identification and reporting requirements.
    • “Significantly below”? “Just under”? I see, ANY cash transaction is suspicious.
  • Client presents uncounted funds for a transaction. Upon counting, the transaction is reduced to an amount just below that which could trigger reporting requirements.
    • What if a client was simply protective of his/her privacy?
  • Client conducts a transaction for an amount that is unusual compared to amounts of past transactions.
    • Wow. Lot’s of stores offer a 3-5% discount if you use cash, as they don’t accept personal cheques, and the merchant really doesn’t want to absorb a 3-5% loss due to Visa/MasterCard service charges. So if you get a deal on a flat screen TV from a small merchant if you pay cash, run away!
  • Client frequently purchases travellers cheques, foreign currency drafts or other negotiable instruments with cash when this appears to be outside of normal activity for the client.
    • For those of you who travel frequently, beware! Big brother is watching.
  • Client asks you to hold or transmit large sums of money or other assets when this type of activity is unusual for the client.
    • Hmm. Sounds like Hank is getting ready to leave the country. Please report this as we would like to ensure we confiscate his money tax him accordingly.
  • Shared address for individuals involved in cash transactions, particularly when the address is also for a business location, or does not seem to correspond to the stated occupation (for example, student, unemployed, self-employed, etc.)
  • Stated occupation of the client is not in keeping with the level or type of activity (for example a student or an unemployed individual makes daily maximum cash withdrawals at multiple locations over a wide geographic area).

The above rules were *NOT* specifically created to rout out terrorists and/or drug lords. The above rules were created to (a) strengthen the private banks control on the medium of money (i.e. credit/cash/debit cards, checks, wire transfers…) and (b) act as an agent of the government to report on those who trade outside of the taxation system by using cash that leaves no paper trail. The above rules serve the interests of the banking/government cartel.

As technology advances and personal privacy erodes (as a result of state fostered apathy – people just won’t get mad anymore – they would rather focus on Canadian/American Idol) it won’t be long before *ALL* of our transactions are recorded and centralized in a database – even when you buy a loaf of bread with some sort of card. When you use a credit/cash/debit card, you are directly inviting a third party (the bank) into your transaction, and indirectly inviting more parties into your transaction by the bank forwarding your transaction to other parties (the government).

I pondered the above for a bit, then I thought of Karl Marx. I regularly read another high-quality blog entitled “FSK’s Guide to Reality” and that blog had an entry that I liked. In the spirit of that post, I put a Canadian perspective on it.

In 1848 Karl Marx and Frederick Engels wrote a book outlining a political ideology, titled “The Communist Manifesto”. This book serves as a “blueprint” or “how-to” guide for the working class (a.k.a “the proletariat”) to overthrow the middle class (a.k.a “the bourgeoisie”). The goal was to overthrow capitalism and free markets. They argued that eventually the classless society of Communism and the abolition of private property would emerge. In his Manifesto Marx described the following ten steps as necessary steps to be taken to destroy a free enterprise society. So without any further fanfare, let’s have a look to see if they apply to Canada:

1 – Abolition of property in land and the application of all rents of land to public purposes.

If you own land, you pay property tax. The “mill rate” is the classification and percentage rate extorted from you to the municipal government each year based on the market value of your property.  If you do not agree to be robbed, the municipal government will use violence against you and your family to collect either by arrest or eviction.  The typical justification is that we use services provided to us by the municipality. Can we opt out of these services and seek private market solutions? Try it and see what happens. If you stop paying your property tax, your land will be confiscated. I always thought that if you own something, you shouldn’t have to keep paying for the privilege to keep owning it. Think on this. If you spent 25 years paying off your mortgage, you still don’t own your land. What every property owner inherits from a buyer is a government lease that you cannot refuse. In addition, it is perfectly legal for the government to expropriate your land without your consent. In the US, they call this “eminent domain”.

Most Canadian land is in the hands of the State. Legislation is being created to provide the state more control of that land. Sometimes this is done under the guise of environmentalism and/or the protection of endangered species, although the State has a miserable track record of protecting neither *AND* they subsidize the very industries that threaten both.

The Canadian Constitution, replacing the BNA act in 1982, does not recognize property rights of individuals.

2 – A heavy progressive or graduated income tax.

Canadian income tax introduced in 1917 – about the same time the US government imposed theirs – cloaked as a temporary tax on personal income and sold to the public as a means to fund the war. After the war, it became clear the government liked it. By 1946, government revenue from indirect taxation (i.e. excise/tariff taxes) fell from 90% in 1913 to less than 4o%. Since 1946, income tax has become a labyrinth of legislation – the Income Tax Act – that essentially says, “the more you make, the more you pay”. From each according to their ability to each according to their need. This concept is not too hard to understand and has been fully implemented in Canada – along with all of the other so-called developed nations.

The Canadian Constitution grants government the power to raise taxes by any “mode or system” of taxation, as well as the ability to borrow – presumably with no limit – on the Public credit. This is a fancy way of saying, “Our credit rating is good as we have the power to extort the monies from our citizens to finance our boondoggles.” – Section 91-3,91-4.

3- Abolition of all rights of inheritance.

We’re not all the way there…yet. However, we have taxes triggered when this happens called “estate taxes”. This extortion is applied as a result of exercising your “privilege” to transfer ownership of your property after death or gift before death. However, very wealthy people can utilize trusts to avoid this tax. The irony is that you have to pay fees to set-up and manage the trust. Put another way, you pay a smaller extortion (paid to lawyers) to avoid the larger extortion (paid to government).

4 – Confiscation of the property of all emigrants and rebels.

Someone who resists or evades taxes for moral and/or ethical reasons stand a zero percent chance of not having their assets seized by the government. Since the attacks on 9/11/2001, there has been a plethora of laws released by government designed to confiscate your property based on their vague definition of what a rebel is…oh yeah, anyone who is against the State.

In Canada, those who emigrate from the country due to an increasing hostile financial climate, are forced to deposit 40 percent of the value of their assets world wide, until the government can determine what their unearned cut is.

5 – Centralization of credit in the hands of the State, by means of a national bank with State capital and an exclusive monopoly.

This one is easy: The Bank of Canada. Commencing operations in 1935, under the ownership of private banks, it was nationalized in 1938 by Mackenzie King. I have not found any worthwhile information about that particular event. There must of been something in it for the private banks to let him nationalize it, or the private banks would have had him removed.

One of the reasons might have been is that the banks are allowed to create money out of the magic of fractional reserve banking. In Canada, the Bank Act does not require the private banks to maintain ANY reserves. In other-words, for every dollar of credit they have out on loan, they are not required to keep any cash reserves to back that loan. In reality they do, as we still ask for cash, but they are working to eliminate cash altogether via alternate medium or regulation. This will be a subject for an upcoming post.

6 – Centralization of the means of communications and transportation in the hands of the State.

The CRTC and Transport Canada regulate the bulk of this plank. However, they need the cooperation of the so-called private market from time to time so they allow laws to be passed to strengthen the monopoly or oligopoly of the players in this industry. There are a vast array of taxes that apply with respect to transportation, be it excise taxes for goods shipped, gas taxes, vehicle taxes, licenses, etc. All of this winds up in the government’s hands.

The internet is a notable exception to state control of communication, but they are trying. The internet is the only worthwhile media for learning, such as reading high quality blogs like this one. 😉

As I have been following Ron Paul’s 2008 U.S. Presidential campaign fairly closely, I have seen just how active media suppression and censorship is. If we had a competitive media and a widespread intelligent audience (see plank 10) demanding better of them, it would be impossible to censor him.

7 – Extension of factories and instruments of production owned by the State, the bringing into cultivation of waste lands, and the improvement of the soil generally in accordance with a common plan.

Certainly it can be argued that big corporations owning the majority of production is essentially state control. Why? Because laws are set up to favor corporations via their lobby groups and offering to accept a government official to a board position once he/she retires from office – a.k.a “the Golden Parachute”.

In addition, Canada used to trend toward nationalizing various bodies of research and production think tanks, but that seems to have been reversed when the government abandoned these efforts, no doubt as a result of freeing itself from the financial obligations of keeping these organizations afloat. In addition, the government realizes that it is more effective to let the private sector develop the market, then levy its extortion taxes later.

Factories are hardly built here anymore, thanks to outsourcing and offshoring. The means of production are giving way to the means of consumption. Farming is heavily regulated and subsidized. This effectively forces the farmer to cede control to the state by submitting to regulations to qualify for the subsidy. Research into natural methods of growing food negating the need to use artificial fertilizers and pesticides is not happening as there is no financial incentive for corporations to do so. Big agra companies like Monsanto are patenting seeds and suing farmers for saving seed for next years crops.

The concept of self-reliance is always under attack by the government, because they don’t want people to think, “Hey. I produce goods and trade them for the goods I don’t produce within my trading community. The government produces nothing. Why do I need them?”

8 – Equal liability of all to labor. Establishment of industrial armies especially for agriculture.

There is no benefit for a spouse to stay at home and raise their children. Where we are today is that due to tax relieving measures NOT being implemented for a parent to remain at home (i.e. income splitting), this forces the second parent into the workforce. Coupling that with the continued assault on the dollar via inflation, Canadians have to work harder/longer to make ends meet.

I find it amusing that municipalities sell their regions to the public as an excellent “live/work” place to be when the cost of living exceeds the worker’s ability to pay for it via all the retail/services businesses opening up, instead of high quality manufacturing/professional jobs – “How am I going to pay for my $400,000 mortgage with a Tim Horton’s job or selling furniture at Sears?”.

9 – Combination of agriculture with manufacturing industries, gradual abolition of the distinction between town and country, by a more equitable distribution of population over the country.

This one I am not entirely sure of what they mean here. What we see is the gobbling up of small family farms by agricultural giants or residential developers. We see the vast expansion of ruralism, where valuable farmland is being paved over with matchbox houses and big box stores. The vast majority of Canadian land has a very small population base. In fact, I read somewhere once where 90% of Canada’s population – currently about 35 Million people – live within 200 kilometers of the US border.

10 – Free education for all children in public schools. Abolition of children’s factory labor in its present form. Combination of education with industrial production.

This one has been implemented without question. We have State run schools with State developed curriculum. State schools teach to regurgitate without processing. The idiom of “education” has been replaced with “job training”.

Critical thinking has been killed. We are a culture of uninformed and unquestioning fools who think life revolves around mindless consumption, be it physical (i.e. iPods, granite countertops, SUVs, and whatever other bling or trinkets and bobbles we pursue) or intellectual (i.e. all problems are to be solved through government, the media is a credible source of information, do not question authority et. al.).

Essentially, the purpose of State run education is to churn out citizens who have been brainwashed to accept the validity of government – or just about any other bully who will coerce, threaten, and or steal from you authority figure. This is a tragedy, as government education intercepts and thwarts the development of the mind in it’s most receptive state.


Hmm… Seems we are well on our way.