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Pirate Party MEP Helps Draft New Credit Card Company Controls 129

Posted by timothy
from the common-carrier-of-currency dept.
Dupple writes with this excerpt: "It has become an increasingly large problem that Visa, MasterCard, and Paypal control the valve to any money flow on the planet. Today, the European Parliament established this as a clear problem, and initiated regulation of the companies, limiting and strictly regulating their right to refuse service. The Pirate Party was the initiator of this regulation, following the damaging cutoff of donations to WikiLeaks, after said organization had performed journalism that was embarrassing to certain governments."
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Pirate Party MEP Helps Draft New Credit Card Company Controls

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  • by concealment (2447304) on Tuesday November 20, 2012 @11:57AM (#42042141) Homepage Journal

    While I like regulation in many cases, like nuclear power plants, in my experience new regulations are like cables.

    When you put all the cables on the floor, they're more likely to snag your legs, or get entangled and knotted with each other.

    This is why sometimes the solution is fewer regulations, and more direct solutions. If relatively few companies control our banking or money flow, the solution may be to break up some large companies.

    I think the feds are about to do this to Google for their near-total-dominance of search results and search-based advertising. Too much power in one set of hands can be destructive, unless that set of hands truly does "do no evil."

    • by Anonymous Coward

      in my experience new regulations are like cables. When you put all the cables on the floor, they're more likely to snag your legs, or get entangled and knotted with each other.

      I guess that's where the analogy starts and ends? If you have a necessity for that many cables running across your floor, just install a false floor so you can run them under the panels.

      • by Moblaster (521614)
        The analogy does not end there. He could buy a wireless router and totally reframe the whole analysis.
        • by c0lo (1497653)

          The analogy does not end there. He could buy a wireless router and totally reframe the whole analysis.

          Hmm... I wonder why the supercomputer guys didn't think of it for interconnecting those thousands of cores...?

          • Malcolm Turnbull has the solution to wireless bandwidth limits, but he's keeping it a trade secret.

            • by c0lo (1497653)

              Malcolm Turnbull has the solution to wireless bandwidth limits, but he's keeping it a trade secret.

              No, he doesn't. Only a certain French company [theage.com.au] has (large grin)... Turnbull is only an investor.

        • Man, I seriously tripped over an 802.11a signal the other day and almost broke my face.
    • by Laglorden (87845) on Tuesday November 20, 2012 @12:05PM (#42042279) Journal

      Maybe there should be a regulation then "don't put all those cables on the ground" ;)

      In my experience analogies are like fauly watches, they are seldom correct and most of the times gives a sense of undestandning something but in reality just complicates things.

      • ...In my experience analogies are like fauly watches, they are seldom correct and most of the times gives a sense of undestandning something but in reality just complicates things.

        I'm confused with your particular analogy, though. Instead of a fauly watch, could you try again using a car with fauly brakes?

        chores,

    • by Overzeetop (214511) on Tuesday November 20, 2012 @12:10PM (#42042345) Journal

      If you throw cables on the floor for any reason, or string them at random heights or intervals to please one particular person, yes - they can bring all progress to a halt.

      Properly planned and distributed, however, they can take a seemingly impossible task - such as spanning a large body of water, capturing a large number of fish, jumping out of an airplane from several thousand feet up and landing safely, or climbing a very tall structure - and make it a straightforward task.

      The only difference between gridlock and utility is the thought and care with which the regulations are laid.

    • Re: (Score:3, Informative)

      by Anonymous Coward

      This is why sometimes the solution is fewer regulations, and more direct solutions.

      Somebody has to be the first to mention bitcoin, so I guess it will be me...
      Though it might not be the be-all-end-all at least it does solve the abuses of power that can come from governments trying to stop the flow of money between people who actually do want to send money from one person to another.

      • Re: (Score:2, Interesting)

        by Anonymous Coward

        Agreed.

        Power corrupts, etc. By the same token, that which uncontrollable and cannot be regulated is incorruptible.

        We can use some incorruptible functions in our infrastructure.

        • by davecb (6526)
          Sure, if the incorruptible thing is a universal good (in either the economic or religious sense of "good"). An incorruptible bad would be ... er, bad!
      • "Though it might not be the be-all-end-all at least it does solve the abuses of power that can come from governments trying to stop the flow of money between people who actually do want to send money from one person to another."

        This is precisely why cash must be preserved at all costs. If money transfer ever becomes exclusively electronic, you will be owned.

    • Re: (Score:2, Interesting)

      by Dan667 (564390)
      regulation is a necessary evil. The financial meltdown under bush/cheney was mostly a result of conservatives removing banking regulations and banks gambling with money they use to not be able to. Even Alan Greenspan commented he thought banks would show some restraint out of self preservation, but he was wrong.
      • by ganjadude (952775)
        if we go that far than we need to go further back to clinton ith his high risk home loans he forced the banks to make to people the banks knew could never pay for.
    • by Anonymous Coward on Tuesday November 20, 2012 @12:26PM (#42042637)

      While I like regulation in many cases, like nuclear power plants, in my experience new regulations are like cables.

      When you put all the cables on the floor, they're more likely to snag your legs, or get entangled and knotted with each other.

      This is why sometimes the solution is fewer regulations, and more direct solutions. [...]

      Listen. To me. Your. Guy. Lost. The. Election. Already.

    • i would like to see how many Google Employees have popped up on the NSA payroll.

    • by suutar (1860506) on Tuesday November 20, 2012 @12:35PM (#42042779)
      I like this, personally; I feel that 'too big to (be allowed to) fail' equates directly to 'too big to be left as a time bomb' and getting bailed out should include getting broken up. But then again I feel that one of the great periods in consumer choice on the internet was when those who owned the wires were forced to allow anyone to use the wires who wanted to (at a reasonable rate), and that it would be lovely to go back to that. (Or better yet, just break up into a wire-owning company, a content-generation company, and a data-shovelling company.)
      • It might not be a bad idea if government bail-outs worked as share dilution (based on the value of shares at the moment the paperwork was filed). The shares could then be used either as a source of revenue once the company was up and running again or to promote the national interest in some other way (by, for example, on-shoring jobs, or transferring the shares to one of the administrative departments to treat as effectively a nationalised company).

        I definitely agree with the idea of horizontal separation

    • by jythie (914043)
      I am not even sure we could break up a transnational like Visa or Mastercard. Who has authority over them? The best a country can do is say 'if you want to do business in our borders, you must follow XYZ rules'.
      • "I am not even sure we could break up a transnational like Visa or Mastercard. Who has authority over them? The best a country can do is say 'if you want to do business in our borders, you must follow XYZ rules'."

        Easy. Designate them as banks. Then they can be regulated.

        That should have been done to PayPal long ago, and already has been done in Europe.

      • Usually the way companies like that work is by having wholly-owned subsidiaries in each country (or regulatory area - so just one in the EU, for example), each of which complies with national laws about who they can do business with (i.e. can they handle payments for prostitutes, can they do business with Cuba, etc.), and employs their local staff, but then outsources actual operations to other subsidiaries which own the big iron and do the core business work, then the whole lot is connected together with m

    • by Anonymous Coward on Tuesday November 20, 2012 @01:36PM (#42043701)

      Oh Americans... will you ever realize, that regulation is when you get to say "No! Stop it! We won't have it like this! Now it's my rules!"

      Which is your only damn defense against those 20-page terms & conditions contracts.

      Why the hell you would complain about such regulation, that does you good, and instead choose to defend the companies, that get to do way too much already, so they can do even more evil shit, is a riddle to us non-Americans.

      It's like a rape victim complaining that his savior should not tell his rapist what to do so much.

      Then again, in North Korea, they really believe that if you touch an American flag, your hands will rot off. As if that would really actually happen...

      So I guess people can be brainwashed into almost any delusion... even that their rapist would be the one that needs "more freedom"... and protecting your own rights would be "harming the free market".

      • by TheRealGrogan (1660825) on Tuesday November 20, 2012 @04:00PM (#42045767)

        They are conditioned to believe this shit at early ages... "If you want to be rich some day, you have to think this way and support Free Market Capitalism. Anything else is just bad, and you don't need to know any more about it. Let's just call it all Socialism. It kind of rhymes with Satan, well, it starts with the same letter, at least."

        This is why you have stupid people, who haven't a pot to piss in, that lobby against things that are in their own interests, in favour of the corporate greed.

        Ordinary workers, living from paycheck to paycheck, getting in debt, saying that at least under (Insert Republican candidate they've been conditioned to support) they get to "keep what they have". No sir, they don't want anything like subsidized health care, they'd rather go into mortal debt for an emergency appendectomy. At least they are living the American Dream and doing it on their own, because government handouts are Socialism, which is the same as Communism (See, the old U.S.S.R. had the word "Socialist" in the title)

        Now these big companies, whose "freedom" they worship, are wanting to claw back their meager wages and benefits while execs get bonuses. Damn those unions for interfering with the God Given Rights of the corporations.

        Of course not all Americans are this obtuse, it's just that they are also taught to be very vocal when others don't agree with their beliefs, or criticize their country.

        • "They are conditioned to believe this shit at early ages... "If you want to be rich some day, you have to think this way and support Free Market Capitalism. Anything else is just bad, and you don't need to know any more about it. Let's just call it all Socialism. It kind of rhymes with Satan, well, it starts with the same letter, at least.""

          The issue raised by GP has absolutely nothing to do with "free market capitalism". You are echoing precisely the kind of delusion to which he referred, just in the other direction.

          "Capitalism" is a means of financing production. And from its very inception (you have obviously not read your Adam Smith, which you really should do before expounding on this issue), it has acknowledged that some regulation would be necessary to keep markets free. In the form of anti-trust, which is a term Smith did not use hi

      • by DarthVain (724186)

        Like Obama being a non-US citizen mulisum. Or like Jesus coming to the Ozarks, or Jesus in general for that matter. Or that totally giving the super rich more money will like totally make them spend more money, which will somehow help the poor people. Or that like Evolution isn't like a thing. Or like ya man, less regulation of our finicinal markets it so the way to go, the invisible hand of captiolism is totaly rad. Or a thousand other things...

        Anyway not sure why I ended up talking like a ninja turtle, bu

    • This is why sometimes the solution is fewer regulations, and more direct solutions. If relatively few companies control our banking or money flow, the solution may be to break up some large companies.

      I don't see how "break up some large" is anthing other than a reworded "regulation".

      • The two aren't completely contradictory: it is a bit like saying that the tax code should be simplified by the total tax rate increased, so that you've got less (and simpler) taxes but more total tax.

        The problem is that too many people confuse "simple" with "permissive" when it comes to regulation. The former is clearly a good thing, within reason, but the latter is problematic. Unfortunately, those benefiting most from regulatory capture argue for permissiveness in the name of simplicity while arguing aga

    • The analogy is problematic but promising. You like regulations in some cases (power plants) but presumably not others. However you are stating the problem is with the number of regulations, rather than how and where they are applied. If your analogy shifted to "rather than all the cables in an unorganized mess on the floor, you organize them so people don't trip". Essentially, you make it simple to follow the rules and comply for anyone within their domain of expertise, and not such a horrible mess you need
    • by s73v3r (963317)

      If relatively few companies control our banking or money flow, the solution may be to break up some large companies

      Wouldn't that be even more regulation?

    • HEAVENS NO!

      That's a horrible analogy. Your solution would imply we should remove all the *cables*(hindrances) from the floor, but that would deprive us of the benefit those *cables*(resources) were to provide! (see the paradox?)

      A better analogy would be deceleration mechanisms on roads; improperly designed and placed speed bumps are a *major* annoyance, but the solution is NOT to eliminate them all together; since they are also what stop a speeding car from killing a silly kid crossing the road.

      What we need

    • by sjames (1099)

      A good rule of thumb on the split-up: Too big to fail = too big to exist.

  • by 3seas (184403) on Tuesday November 20, 2012 @12:02PM (#42042207) Journal

    ...how it is that banks can control the abstract tool used for easing trade ......

    So I want to trade you for something you have but I don't have what you want so we used this abstract tool to allow you to then get what you want from some one else.
    But we cannot even do that because some bank which originated in the support of the basic idea of this abstract tool decides they don;t want to?

    They are contradicting the purpose of the abstract tool of money. They are contradicting their own original objective.

  • catch-22 (Score:5, Insightful)

    by doug141 (863552) on Tuesday November 20, 2012 @12:04PM (#42042243)
    What will finance companies do when one government's laws make it illegal to do business with some entities, while another government's laws mandate it?
    • Money (Score:5, Insightful)

      by Frankie70 (803801) on Tuesday November 20, 2012 @12:05PM (#42042277)

      Donate money to one or both the governments and get the laws fixed. Next Question.

      • Re:Money (Score:5, Interesting)

        by IamTheRealMike (537420) <mike@plan99.net> on Tuesday November 20, 2012 @01:29PM (#42043571) Homepage

        No, we already know what happens in this situation. US law takes precedence. Example: Danish company wires $26k to a German bank and the payment is seized by the USA [b.dk] because it was a payment for Cuban cigars.

        The EU has a terrible track record when it comes to stuff like this. SWIFT was the only major payment network that was a European company and the US Treasury completely compromised it by seizing their US datacenter. So they built another datacenter in Europe so they could have multi-homed operations without exposure to the USA and whilst construction was being done, the US put huge pressure on the bureaucrats who then rolled over and said, sure, you can have all the data you want from SWIFT. So if the EU parliament really wants payment networks to stop doing things because the US wouldn't like it, the first step is to cut off the US Treasuries unilateral access to SWIFT data. But they won't.

    • by tilante (2547392)
      Have to make a decision about which government they want to anger the least, of course.
    • by Khashishi (775369)

      That's what happens when you are a multinational corporation. The solution is probably to spawn semi-autonomous business units in each country.

    • by dkleinsc (563838)

      Follow the jurisdiction you're in: For example, you can't do business from the US with Wikileaks, but have to allow business from the Ecuador with Wikileaks, that sort of thing.

      • by Anonymous Coward

        http://www.wikileaks.org/Banking-Blockade.html

        According to WikiLeaks own site (link above), my United States government has no law against giving them money. Some US-based banks are acting on their own.

        European finance should not depend on US privates companies, i.e. banks, to provide electronic payments. Where are the French and German based credit card companies? Surely, Switzerland can manage to create one.

        • by Anonymous Coward

          US-based banks are acting on their own.

          Joke of the decade. It's in banks' interests to process as many transactions as possible. They'd refuse service only if (a) the service will cause them harm or (b) someone is forcing their hand. I don't see how revealing government's secret deals harms banks.

    • Re:catch-22 (Score:5, Informative)

      by fredprado (2569351) on Tuesday November 20, 2012 @12:12PM (#42042387)
      What they always do. Deny service to those people with credit cards from the countries that want to forbid and allow service to those people with credit cards from the countries that mandate it.
    • Zombies (Score:4, Informative)

      by Overzeetop (214511) on Tuesday November 20, 2012 @12:14PM (#42042419) Journal

      You can just clone a corporation by cutting it into two independent pieces. Like a zombie, but eating money instead of brains. And regenerating all the missing parts instantly after cutting it in two. With the right shell structure, you can usually avoid those problems long enough to get new laws written - like waiting around for the food and ammo to run out on your human victims. With enough lawyers, corporations can just hang out until the conditions are right for consolidation of resources. And a feast of brains.

      • And a feast of brains.

        After which there will be no more brains left to feast on. They'd be better off making sure that the humans have a sustainable supply of food and ammo.

        Then again it's not immortal zombies running these businesses, it's mortals. So they probably don't care what happens after the feast.

    • by jythie (914043)
      Shell companies. This is already common practice for getting around conflicting (or simply inconvenient) laws for transnationals.
    • by s73v3r (963317)

      I really don't care how bad the finance companies feel they've got it. They did this to themselves.

  • I'd love it if RSM offered a FSF credit card, with a gnu on it.
    If the status quo is evil, where is the free alternative?
    • by s73v3r (963317)

      It takes an absolute fuckload of money to start up a credit card company/bank.

      • Again: where is the capitalism? Why are the barriers to market entry so high?
        If we're so clever, why aren't we engineering a workaround for crappy laws?
  • Just government arrogating onto itself more power, in this case, it wants to be the only entity that can cut off CC service to disfavored groups.

    This is going in the wrong direction. Learn some history.

    • by s73v3r (963317)

      Nope. Not what's happening at all. They're simply saying that a credit card company cannot deny your transaction just because they don't like who the money is going to.

      I don't give a flying fuck how "private" the banks/CCs are. They have deeply entrenched themselves in our financial infrastructure. Doing so means they have obligated themselves certain responsibilities. There is absolutely no valid reason whatsoever that Visa should be able to tell me who I can and cannot transfer money to. Even if it is usi

  • by Anonymous Coward on Tuesday November 20, 2012 @12:30PM (#42042717)

    The MEP, Christian Engström", who instigated this is being disengenous when he claims the problem he is fighting is "American fundamentalist moralism". If you RTFA you find out that it was Swedish banks denying purchases of "horror movies, movies with nudity, or sex toys" and trying to shove blame off on "vague rules from Visa and Mastercard". Mastercard, Visa, and PayPal allow purchases of these items every day the world over. He should instead be blaming Swedish fundamentalist moralism. This strikes me as nothing more than another European statist power grab against an American company. If the Europeans want in on the payment processing business then they should create a competing company, not use big government to attempt to seize power over American companies.

    • by mrbester (200927) on Tuesday November 20, 2012 @12:45PM (#42042935) Homepage

      There's also the issue that you can donate to the KKK using Visa but can't donate to Wikileaks because Visa have arbitrarily deemed them "guilty" of some crime, most likely at the behest of US Govt.

      • by Anonymous Coward

        While it is true that Visa blocked donations to Wikileaks and I agree that it was likely done at the request of the U.S. government I do not think the answer is more government. If people are afraid that the blocking of Wikileaks is just the tip of the iceberg then it provides a market opportunity for another card processing company to form outside of the U.S. I would prefer to see that happen than the Europeans decide that they can tell a private sector business that they must provide service. One reaso

        • by s73v3r (963317)

          While it is true that Visa blocked donations to Wikileaks and I agree that it was likely done at the request of the U.S. government I do not think the answer is more government.

          That's too bad, as there are no other viable alternatives.

          If people are afraid that the blocking of Wikileaks is just the tip of the iceberg then it provides a market opportunity for another card processing company to form outside of the U.S.

          You people keep saying that, and yet it NEVER FUCKING HAPPENS. Besides, I don't want to have to worry about which payment processor will accept which payments. They should not have the right to deny me the service.

          I would prefer to see that happen than the Europeans decide that they can tell a private sector business that they must provide service

          And I would far, far, far rather see it happen that a company can entrench itself in the global financial infrastructure and make it obscenely difficult to do business without them cannot arbitrarily decide what they will and will not allow

          • by Anonymous Coward

            While it is true that Visa blocked donations to Wikileaks and I agree that it was likely done at the request of the U.S. government I do not think the answer is more government.

            That's too bad, as there are no other viable alternatives.

            [..]

            Process Wikileaks transactions.

            In this context, the credit card payment processors are in a similar position to SWIFT (the Society for Worldwide Interbank Financial Telecommunication), who process most international wire transfers. SWIFT is a company based in Belgium, and because of sanctions imposed by the EU, is unable to process transactions involving most Iranian banks.(Since this ban, Turkey has been buying Iranian oil with physical gold.)

            SWIFT saying "The EU told us not to do deal with Iran" is the same as Visa saying "The US told

    • by davecb (6526) <davec-b@rogers.com> on Tuesday November 20, 2012 @12:54PM (#42043065) Homepage Journal

      If you RTFA you find out that it was Swedish banks denying purchases of "horror movies, movies with nudity, or sex toys" and trying to shove blame off on "vague rules from Visa and Mastercard".

      Oddly enough, contemporary Swedish fundamentalist moralism doesn't seem to include problems with "horror movies, movies with nudity, or sex toys". It may have a real problem with wikileaks, though, comparable to the problem the U.S. (and UK, and, and ...) governments have with wikileaks.

      Visa and Mastercard have a significant problem with displeasing governments: if you don't forbid them acting in concert to please their home governments, your country gets whatever the U.S wants (as discussed in several other threads in this discussion).

      --dave

    • No, it was the payment service providers Visa, MasterCard and PayPal who took the decisions to block, not the Swedish banks.
      • Can you back that up with something more substantial? I found this in depth article [wordpress.com] and it paints a very muddy picture. PayPal suspended their account and then re-activated it again, but that sort of thing is par for the course with them. The banks that were interviewed all seemed to say either, "decisions are made by local branches, we don't control it" or "VISA and Mastercard forbid businesses selling obscene things" (ok) but also that the banks have ethical policies and may "refuse to engage if it would

    • by TheP4st (1164315)

      Mastercard, Visa, and PayPal allow purchases of these items every day the world over.

      FYI PayPal recently closed a Swedish online retailers account for selling titles that contain words like sex and violence.

      Source (Swedish): http://www.gp.se/ekonomi/1.1128282-betalforetag-censurerar-sex-och-skrack [www.gp.se]

    • by ultranova (717540)

      If the Europeans want in on the payment processing business then they should create a competing company, not use big government to attempt to seize power over American companies.

      Europeans can't seize power over American companies due to not having physical capacity to do so. On the other hand, Europeans can seize power over the portions of international corporations that operate within EU. And why shouldn't they? "Big government" is not a boogeyman in Europe, so appeals to it are not a sufficient reason.

      Wh

  • by slashmydots (2189826) on Tuesday November 20, 2012 @01:36PM (#42043705)
    Just saying, this is THE reason they were invented. You can get money to anyone in the world in approx 10 minutes without any oversight of blocking or interception or BS like Paypal and the big CCs try to pull.
    • by SirGarlon (845873) on Tuesday November 20, 2012 @01:44PM (#42043829)

      You can get money to anyone in the world in approx 10 minutes

      Sure, if you have an extraordinarily loose definition of "money."

      • You can get money to anyone in the world in approx 10 minutes

        Sure, if you have an extraordinarily loose definition of "money."

        Money: something that people give value to.
        What backs the US dollar again?

      • by Anonymous Coward

        Sure, if you have an extraordinarily loose definition of "money."

        1. buy bitcoins in your country
        2. transfer the bitcoins over
        3. sell bitcoins in target country

        Which step do you have a problem with?

  • by Anonymous Coward

    Good, how about nationalizing them, or simply providing free government infrastructure for payments?

    As far as I can tell Visa/Mastercard are just parasites who offer no value at all and only survive due to inertia/network effects.

  • It says that a member of European Parliament is gonna write a bill. That is not particularly surprising. It is, after all, his job to write bills.

    It doesn't say anything about how the other MEPs will vote on the bill, or whether European regulations would supersede national regulations in this case.

  • I understand it is just a report, which does not means it will become a UE directive. Remember the UE parliament is not a real parliament: it cannot initiate the legislative process. They will have to convince the European Commission to start a directive draft, and the Commission can just ignore them (and there are precedents).

    IMO nothing will happen. UE has nothing to do with a democracy where member of parliament have some power.

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