Embedded within our justice system and the values of our society we have the concept of the protection of the innocent. See William Blackstone's famous quotation: "It is better that ten guilty persons escape than that one innocent suffer."

If you want to imprison all the murderers, you can accomplish that goal by imprisoning everyone but we don't do this and most people would recognize that the idea is mad.

So the test here for any regulating authority should be, is your regulation harming the innocent in some way? If so, the imperative is on you to find a better way to go after the guilty, if you don't you have become an enemy of the public good and your moral authority is lost. We can get into specific regulations but I think with modern KYC and AML we are absolutely at the point where they contribute to the suppression of economic growth and individual liberties and need to be dialed back.

Very well said. It should also be said that criminals that want to launder money only exist because of government regulation. Sometimes that's totally justified, say with human trafficking, and sometimes not so much, like maybe a marijuana dispensary.

The point being, sometimes undercutting criminal activity can be done be legalizing the activity rather than introducing more types of illegal activities to try and detect the original ones. The cure is sometimes worse than the disease.

That parts fine, it's the collateral damage that's the problem. Laws don't know who're the bad guys and who are the good guys, and sometimes everyone else gets caught up in the dragnet. By all means, stop the bad guys, but unfortunately, they don't easily identify themselves, so we pass laws and apply them to everyone (in theory), but they can end up doing more harm than good.

The $10k rule by the Bank Secrecy Act wasn't indexed to inflation and would be closer to $80k today. So it should be amounts up to $80k that aren't considered worth monitoring, but instead, if you deal with, say, buying and selling cars, you get tripped up by that all the time. It's regulatory red tape overhead that costs a legitimate business extra time money that they could be better spent elsewhere.

For the every criminal there are thousands of people getting.. KYC'ed over minutiae.

And even you yourself answer the main question - it doesn't stop criminals. Just makes it more expensive.