So, under the resposibility given it by Congress, the Treasury department has identified BDA as a money laundering concern and has restricted it from access to the US financial market.

As for a law being “irrevocable,” where in the world did you get that idea? There is no irevocable law. Even the Constitution is changable (and has been changed 27 times). You are certainly free to write your member of Congress and ask him or her to investigate or change the law. That is if you have a member to write to. If not…..

So, per US law, BDA cannot use the US financial system. Wachovia is part of the US financial system. So, Wachovia cannot work with BDA. Perhaps the Bush administration will find a way around that law, but it hasn’t yet. Maybe Bush should write his member of Congress.

Back to the point: There is nothing preventing the North Koreans from getting their money. The only straw man in this whole deal is their insitance that they use a US bank to get it.

Sec. 311. Special measures for jurisdictions, financial institutions, or international transactions or accounts of primary money laundering concern. Section 311, included in both the Senate bill and H.R. 3004, adds a new section 5318A to the Bank Secrecy Act, to give the Secretary of the Treasury, in consultation with other senior government officials, authority (in the Secretary’s discretion), to impose one or more of five new “special measures” against foreign jurisdictions, foreign financial institutions, transactions involving such jurisdictions or institutions, or one more types of accounts, that the Secretary, after consultation with Secretary of State and the Attorney General, determines to pose a “primary money laundering concern” to the United States. The special measures include: (1) requiring additional recordkeeping or reporting for particular transactions; (2) requiring the identification of the foreign beneficial owners of certain accounts at a U.S. financial institution; (3) requiring the identification of customers of a foreign bank who use an interbank payable-through account opened by that foreign bank at a U.S. bank; (4) requiring the identification of customers of a foreign bank who use an interbank correspondent account opened by that foreign bank at a U.S. bank; and (5) after consultation with the Secretary of State, the Attorney General, and the Chairman of the Federal Reserve Board, restricting or prohibiting the opening or maintaining of certain interbank correspondent or payable-through accounts. Measures (1) through (4) may not be imposed for more than 120 days except by regulation, and measure (5) may only be imposed by regulation.

endquote

Patriot Act Section 311 investigations are designed to be unilateral, secret, without due process, and rescindable by the executive branch. The fifth special measure—the one applied to BDA—is intended as a coercive tool to use the threat of a cutoff from the US financial system to compel foreign banks and jurisdictions to improve their anti money-laundering measures to the satisfaction of the Treasury Department. Then Treasury can rescind the rule when it deems fit, as it has already done in other cases.

Treasury can revise or withdraw the rule at any time for whatever reason and without any public hearing. Interested parties can petition (as BDA has) but Treasury has no obligation to respond to the petition. In other words, Section 311 is meant to be a discretionary tool of the executive branch. It’s deliberately designed to use the means of a regulatory “rule” to give the executive branch complete freedom of action, without further legislative action or judicial review.

It’s rather…ironic to see the people who exploited the extreme executive latitude provided by PA 311 to go after BDA now claim that the measure against BDA is an irrevocable law that can’t be tampered with—or, as some have said, that State Department officials are complicit in money laundering for getting Wachovia Bank to declare it is willing to handle the funds if it gets approval from Treasury. I know it’s a prevalent anti-State Department talking point, but it’s just plain wrong.

If you have been following this issue closely, you would know that Section 311 of the USA Patriot Act is part of US law and the Treasury Deparment’s ruling on BDA was simply acting under the authority presribed by that law.

I guess the Treasury Department could have chosen to ignore its responsibility under the law and looked the other way, which would certainly have made Chris Hill happy.

If that is a straw man, it is a straw man passed by both houses of Congress.