It’s not just that they don’t want it, it’s that they’re liable for it themselves if they should have known it was happening. Asking you adds one more small layer of “we discouraged illegal activity and we didn’t know about any”.

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janalsncm an hour ago | parent [-]

Maybe I am just slow.

Bank 1 has the CYA clause and a cartel uses them for a decade for illegal purposes.

Bank 2 does not have the clause and a cartel uses them for a decade for illegal purposes.

In neither case does the clause prevent the illegal activity or make the bank any more or less aware of what customers are doing. They have to do KYC regardless of what the TOS says.

	▲	anamexis 23 minutes ago \| parent [-]
		The point of the CYA clause isn’t to prevent illegal activity or make the bank more aware of what customers are doing. The point is that when Bank 1 is defending itself in court, it has one additional thing they can point at when arguing that it should not be liable for the illegal activities.