Slashdot Mirror

For comparison, here's what a bank registration looks like

http://www.fsa.gov.uk/register/firmPassports.do?sid=77499

Passports for:
149243 - Svenska Handelsbanken AB (Publ)
List of credit institutions able to exercise passporting rights in relation to activity 15 (issuing electronic money) of the Banking Directive.

Home State Regulator Directive
SWEDEN BCD Inward Branch
Activity Name
1 - Acceptance of deposits and other repayable funds from the public
10 - Money broking
11 - Portfolio management and advice
14 - Safe custody services
2 - Lending including consumer credit, mortgage credit, factoring and financing of commercial transactions
3 - Financial leasing
4 - Payment services as defined in Article 4(3) of Directive 2007/64/EC of the European Parliament and of the Council of 13 November 2007 on payment services in the internal market(*)
5 - Issuing and administering other means of payment (e.g. travellers' cheques and bankers' drafts) insofar as this activity is not covered by point 4
6 - Guarantees and commitments
7a - Trading for own account or for account of customers - money market instruments (cheques, bills, CDs etc)
7b - Trading for own account or for account of customers - foreign exchange
7c - Trading for own account or for account of customers - financial futures and options
7d - Trading for own account or for account of customers - exchange andy interest rate instruments
7e - Trading for own account or for account of customers - transferrable securities
8 - Participation in securities issues and the provision of services related to such issues
9 - Advice to undertakings on capital structure, industrial strategy and related questions and advice and services relating to mergers and the purchase of undertakings
* - additional MiFID services and activities subject to mutual recognition under the BCD
A(1) Reception and transmission of orders in relation to one or more financial instruments
Investment Instrument
            C(10) Options, futures, swaps, forward rate agreements and any other derivative contracts ...
            C(5) Options, futures, swaps, forward rate agreements and any other derivative contracts ...

A(2) Execution of orders on behalf of clients
Investment Instrument
            C(1) Transferable securities
            C(10) Options, futures, swaps, forward rate agreements and any other derivative contracts ...
            C(5) Options, futures, swaps, forward rate agreements and any other derivative contracts ...

A(3) Dealing on own account
Investment Instrument
            C(1) Transferable securities
            C(10) Options, futures, swaps, forward rate agreements and any other derivative contracts ...
            C(5) Options, futures, swaps, forward rate agreements and any other derivative contracts ...
Home State Regulator Directive
SWEDEN BCD Inward Service
Activity Name

7e - Trading for own account or for account of customers - transferrable securities
* - additional MiFID services and activities subject to mutual recognition under the BCD
A(2) Execution of orders on behalf of clients
Investment Instrument
            C(1) Transferable securities

A(3) Dealing on own account
Investment Instrument
            C(1) Transferable securities

In the US, PayPal is registered with the state governments as a money transfer agent.

The UK's FSA lists them as follows
http://www.fsa.gov.uk/register/firmPassports.do?sid=189419

Passports for:
470235 - PayPal (Europe) Sarl et Cie SCA
List of credit institutions able to exercise passporting rights in relation to activity 15 (issuing electronic money) of the Banking Directive.

Home State Regulator Directive
LUXEMBOURG BCD Inward Service
Activity Name
1 - Acceptance of deposits and other repayable funds from the public
2 - Lending including consumer credit, mortgage credit, factoring and financing of commercial transactions
5 - Issuing and administering other means of payment (e.g. travellers' cheques and bankers' drafts) insofar as this activity is not covered by point 4

Organisations like the FSA exist to ensure that each transaction that occurs is audited to make sure that it has a financially sound objective, not just gaming the system for weaknesses. Market participants can fined very significantly for getting this wrong.

I find this assertion laughable, FSA clearly is more concerned with soy futures. Hold on, from you spelling of organization you must be referring to the ths FSA which is likely just as understaffed as its US equivalent and no doubt run by individuals hopping to get gigs in private industry. IAAMBA (I am a MBA) so I know pointed-headed-ness.

-Long time lurker first time coward.

e-money is one class of registration. You can find the full list here
http://www.fsa.gov.uk/pages/About/What/financial_crime/money_laundering/3mld/registered/index.shtml

It includes "providing payment services"
and "Issuing and administering other means of payment"

The problem with bitcoin, as with any other form of money, is that people have to trust it as a store of value. Most people who look at this aren't going to understand how it works, and if they don't understand it, they probably won't trust it.

For example, if your bitcoins are stored on a USB flash drive, then surely you can copy that flash drive, and spend both of them. I believe there is an answer to why you can't do that, but most people aren't going to have the technical knowledge to understand if the measures they have in place really work.

Then of course, can you rent an Amazon Cloud for a few dollars/euros to crack the codes? In ten years time will you be able to do this on your iPhone 16?

That's an interesting point. I looked up what the FSA has to say about this. The rules seem to be laid out in this document. It defines e-money as:

monetary value as represented by a claim on the issuer which is: (i) stored on an electronic device; and (ii) accepted as a means of payment by persons other than the issuer

Bitcoin satisfies both points 1 and 2 - but, note that this has to be a "claim on the issuer". Bitcoin does not have a specific issuer. The closest you might find are the miners, who create new currency, but I think a clever lawyer could argue even they are not really "issuers" because they cannot control how much money they create, and the money that is created is assigned to the miner not anyone else. It'd be more accurate to say miners are collectively rewarded by all of the systems participants for securing the network, with a de-facto agreement that finding a block rewards you with coins.

But even if you define a miner to be an issuer of the currency, Bitcoins do not represent claims on them. Miners have no obligations to accept Bitcoins in return for anything. There are no guarantees made by anyone that Bitcoins can be redeemed for anything in particular. For this reason I think it's unclear whether the FSA rules would apply. The rationale for the rules makes sense as long as the e-money issued is backed by something else, which was a pretty reasonable assumption until Bitcoin came along. The rule that says e-money issuers must have at least 1 million euros in liquid assets has no rational basis for miners however, as miners do not back the currency.

At any rate, this will be an interesting discussion between lawyers and regulators in coming years I'm sure. One thing to bear in mind is that it's not necessarily (as so often painted) an "us vs them" fight. One reason Bitcoin is interesting is that it lets people be more independent of banks. Politicans know that in the wake of the financial collapse there has been a crisis of trust and confidence in banks. Many ordinary people are quite disgusted with how bankers gambled with the system, were then bailed out and immediately went back to paying themselves massive bonuses. What's more whilst all politicians agree the system is broken, none of them have been able to propose convincing solutions. Basel 3 etc are incomplete at best. If Bitcoin is marketed well, it could easily be seen by seized by forward thinking politicians as a solution to over-reliance on banks, thus making their constituents happier.

Banks already do filter payments; you're not permitted to use them for money laundering or payments obtained through, for example, the sale of illegal drugs. Or should money laundering be protected under free speech regulations?

In many places they do have to be regulated to be a money-transfer institution.

For example, here is the Western Union subsidiary as a pure money-transfer institution and here is PayPal's EU-wide registration as a deposit-taking institution..

Presumably they need some sort of registration in India. Hardly surprising the Indian government is pissed.

In many places they do have to be regulated to be a money-transfer institution.

For example, here is the Western Union subsidiary as a pure money-transfer institution and here is PayPal's EU-wide registration as a deposit-taking institution..

Presumably they need some sort of registration in India. Hardly surprising the Indian government is pissed.

Private Limited Company

An entity incorporated by registration under the Companies Act 1985 whose members (i.e. shareholders) have a limited liability towards their company. Its name must end with 'Ltd'. 'Limited liability' means that the members' liability is limited to paying to the company the price they have agreed to pay for their shares - after the shares are fully paid up no further liability exists. The company has its own legal personality so is separate from the individual(s) who formed the company and from directors/shareholders.

Decisions affecting the business, the company or its assets are made either by directors or by shareholders. The division of powers between board meetings (directors' decisions) and general meetings (shareholders' decisions) imposes a more formal regime on companies compared to partnerships and sole traders. In private companies the same people are often the directors and the major shareholders.

The company alone is responsible for the debts and obligations of the business, even in insolvency (with some exceptions). The obligations concerning the publishing of company information are more onerous than for sole traders and partnerships.

We're already there in the UK Financial Services industry. Earlier this year, the FSA (our financial regulator) issued a report on best practice that, amongst other things, recommends that

• organisations should work on the assumption that staff do not know what the firm's policies and procedfures are
• staff handling customer data should not be allowed to have mobile phones or personal belongings at their desks
• staff should not have access to external email or the internet unless there is a genuine business need
• all USB ports should be disabled so that only approved, encrypted devices will work

If you're in the industry and doing less, expect regulatory sanctions if anything goes wrong. It's time to get tough on slack security.

Website or high-street branch, if it's a bank in the UK, we have plenty of rights.
See: FSA.

In most cases like this though, a "one off" (hopefully), complaints would be forwarded to the FOS. Simple maladministration - coupled with the obvious security implications of employees playing with passwords should net him a good £300 ($600) compensation at least. And Lloyds would be charged approximately £700 ($1400) for the privilege of having the ombudsman review the complaint - regardless of the outcome.

I'm disgusting with Paypal and going through the process of deleting my account. It's not easy, but I'll keep trying. Paypal will always suck in the UK it seems...

not allow you to speak to anyone in the dispute or resolution centre, leaving you arguing with sales staff who don't have a clue

the only difference is that CC companies are regulated

In the UK, PayPal *are* regulated. The Financial Services Authority takes a dim view of electronic money institutions operating outwith their regulatory purview.

If it walks like a duck, the FSA (rightly) wants to regulate it like a duck.

About 25% of spam I get is for US re-mortgages (and I'm not in the US). Never mind tracking the spammers, there must be serious institutional capital backing for those schemes, if the US government financial services regulator is incapable of tracing several hundred thousand dollar transactions, heck, they ain't doing their job properly. Is there even an equivalent to the FSA regulator in the US? These mortgage spams only ever seem to come out of the US.

I guesstimate this list of 'bank like businesses' of some sort of .gov.uk organisation to have 110 banks operating in the UK. Lets say a bank has fifty employees on avarage. lets say two third of them are behind a desk and computer. Lets say one in ten of these people are authorized to perform small financial transactions with this computer in a way repeatable after interception with a keylogger.

This would mean there are more than 350 people (3.5 per bank) sitting behind a computer that are capable of transfering small sums to somewhere in Israel in the UK alone.

Now the assumtions that are easy and terrifying to slashdot readers come in. Given that banks deploy ATM`s based on windows:

• how many of these people are on a windows machine?
• How many of those have acces to e-mail from that machine?
• Finaly what is the lowest IQ in the group of people with e-mail access, transfer?

Also given the amount recovered, that fact that someone was caught "collecting" this money in israel and the presumtion people want to shut down these things asap I wonder Could it be this was cought not because admins found keyloggers (but didn`t bother preventing them) but because someone/something in israel wondered why some "nobody" was getting millions worth of small payments out of one bank in the UK? Remember that credid card fraud is hunted for using statistical analysis of transfers. Maybe thats what caught them. If they had just transfered many small sums to many greenpeace alikes they would be fine ;-)

OK, so if the original owner of itunes.co.uk had their site doing something music related but different from Apple's offering, then it would probably be Apple that had slipped up.

However, a quick look at the site www.itunes.co.uk shows not one, but two redirects,
from http://www.cyberbritain.com/itunes
to iGetGifts.com earn Points for making purchases online: Get paid to use free stuff. Quick Quid: Go shopping with iGetGifts.com today. Earn at book shops (books), bet, betting, fashion, food, cds, music, dvds, film, games, electrical, entertainment, insurance, finance, travel and various other online retailers

If it's not cybersquatting, then it is, at the very least, trading on the reputation of another organisation.


Still, it could be worse. The Food Standards Agancy and Financial Services Authority are both UK government run, but only one gets the http://www.fsa.gov.uk/

I can't lay my hands on the exact money laundering regs at the moment but there is an approved list of IDs one to prove who you are and one to prove where you live.

The thing to remember is that bank staff often don't know what is acceptable and what is not. For both proof of ID and Address a letter from a responsible person (Dr, vicar, lawyer) is ok. If a bank gives you a hard time refer them to the FSA Handbook ML3.1.5/6 (see the link above).

Money laundering regs are a pain in the bum but they are a required part of any finacial organisation in the UK.

Ian (who's a credit union director who failed his money laundering test the first time).

Paypal in the UK (at least) is "PayPal (Europe) Ltd. is regulated by the Financial Services Authority in the United Kingdom as an electronic money institution." (FSA). Ok, it's not much, but it's at least SOME protection...

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