I’m not sure I claimed simple phone number collection requirements is necessarily good policy or that it’s effective. I did not that other regimes have more draconian but more effective measure. I was explaining the provenance for such requirements - and that the base motivation is KYC. Being in the industry for a long time from small fintech to massive institutions I’ve never seen any place that’s intentionally harassing or being coercive - in fact the pressure is towards minimization of requirements and easing of onboarding / KYC as much as they can get away with. However this also turns into a farcical underinvestment in UX because management often believes by ignoring the function and turning the thumb screws on their KYC functions they can somehow make it better rather than worse - worse to the extent of appearing harassing and coercive, or worse to the extent of exposing legit users to fraud and hacking.
The issue though boils down to governments don’t want the financial infrastructure in their jurisdiction to allow unfettered crime. I’ve never seen a single government (granted I’ve never seen what happens in extremely oppressive regimes as we don’t generally do business there due to sanctions controls) who actively collects KYC outside of large transactions, the regulations exist to ensure a minimum baseline of KYC so the companies themselves can comply and reduce their own losses and instability as someone is often kiss liable in fraud and in money laundering or sanctions evasion some institution is subject to fines for facilitation.
But to be frank I think very little of what’s done is materially successful against most competent criminals and the consequences of being caught is usually just being blocked until they find a way around. To that end it’s a bit of not security theatre but compliance theatre. On the other hand it does act as a high pass filter as most fraud and financial crime is NOT competent. By and large retail finserv is a minimization effort not a prevention effort.
The regulations that are effective at prevention are usually so restrictive and so difficult to implement that they’re absurd for both the finserv to implement and for the participants to get through the hurdles.
I don’t know there’s any perfect solutions, and what exists is generally dumb, but the intentions are at the core well intended. It’s foolish tho to look at something as complex as financial infrastructure and wave it away as harassment and coercion rather than well intentioned incompetence.
The issue though boils down to governments don’t want the financial infrastructure in their jurisdiction to allow unfettered crime. I’ve never seen a single government (granted I’ve never seen what happens in extremely oppressive regimes as we don’t generally do business there due to sanctions controls) who actively collects KYC outside of large transactions, the regulations exist to ensure a minimum baseline of KYC so the companies themselves can comply and reduce their own losses and instability as someone is often kiss liable in fraud and in money laundering or sanctions evasion some institution is subject to fines for facilitation.
But to be frank I think very little of what’s done is materially successful against most competent criminals and the consequences of being caught is usually just being blocked until they find a way around. To that end it’s a bit of not security theatre but compliance theatre. On the other hand it does act as a high pass filter as most fraud and financial crime is NOT competent. By and large retail finserv is a minimization effort not a prevention effort.
The regulations that are effective at prevention are usually so restrictive and so difficult to implement that they’re absurd for both the finserv to implement and for the participants to get through the hurdles.
I don’t know there’s any perfect solutions, and what exists is generally dumb, but the intentions are at the core well intended. It’s foolish tho to look at something as complex as financial infrastructure and wave it away as harassment and coercion rather than well intentioned incompetence.