Not providing KYC is definitely not a crime. It happens all the time. What usually happens is that the bank just terminates the account, after a while.
Unless someone dislikes them, in which case they will unwittingly accept a sanctioned entity and then the indictment will scream bloody murder that this was basically all about not doing KYC (even though we all know sanctioned entities operate on white market using dark identity, so regular banks guilty too).
> in which case they will unwittingly accept a sanctioned entity and then the indictment will scream bloody murder that this was basically all about not doing KYC
Example? Every one I can think of involved the bank not doing KYC, criminals taking advantage of it, and evidence at least some people at the bank knew what was happening. (Usually because authorities told the bank they were doing business with criminals and the bank responded by shuffling things around so they could continue doing that business.)
Banks are always doing business with criminals and sanctioned entities and they know that, although not always when and where.
The difference is if the bank does KYC and the criminal uses a dark identity, the bank will likely get away with it. If the bank just gives each person a random number as their only identifier like the old swiss accounts, then they'll be warned sanctioned entities are using it and ultimately prosecuted when they fail to KYC (i.e. similar but but identical to CZ).
> difference is if the bank does KYC and the criminal uses a dark identity, the bank will likely get away with it
What is a dark entity? Have you worked in finance? Because if you collect KYC and accepted forged or faulty documents, the moment you figure out what's going on is the moment you call your personal lawyer.
> a lot of people would be eager to know the names of these banks that let customers operate without KYC for awhile
Non sequitur. Banks generally have to have KYC to do business, though there are famous exceptions in history. There is no jurisdiction I know of in which as a customer not providing KYC is itself a crime.
The customer isnt charged, it is the bank/entity or persons there. Not legal advice but failure if AML and not collecting identifying information is charged under 31 USC 5322 under indictment I'm reading.
The law here notes even some CFRs are criminally binding, the CFRs explicitly require certain identification.
What happens if the banks don't close it?