Why must identification be provided when purchasing a money order?
The Bank Secrecy Act of 1970 requires that banks assist the U.S. Gov't in identifying and preventing money laundering. This means they're required to keep records of cash transactions of Negotiable Instruments, and report any such transactions with a daily aggregate limit of a value greater than (or equal to?) $10,000. Because of this, the business which is issuing the money order is also required to record this transaction to report it to the bank, who then holds the records in case FinCEN wants to review the transactions. EDITED: Added clarification on the $10,000 rule
"In that case, he was not arrested for being unable to pay his bill. He received a summons to court, failed to appear, and so a warrant was issued for his arrest. The $350 was his bail amount, which is funds that must be provided to the court in order to be released while pending trial (you get this money back once you appear before court). He also wasn't convicted of a crime and sentenced to jail in this case, just arrested. He would be ""kept"" by the courts (if he couldn't post bail) until his court date as a way of being forced to appear. If a judgement was awarded against him, it still doesn't always mean he has to pay. If someone refuses to pay a judgement (but did show up to court) then typically their wages are garnished, which means the court orders that a certain amount of money be withheld from income, tax refunds, etc. until the judgement is paid. However, if the person ordered to pay can prove that they would not be able to have sufficient money to survive if they are garnished (I'm not a lawyer so I am unclear as to the exact process/standards) then there is a chance that nothing will be garnished at all.  So in short, no, there is no such thing as debtor's prison in the USA. There is definitely such a thing as being arrested / put in jail for defying court orders, and I'm sure if you took out loans while knowing you have no ability to repay them that you might be able to be charged with some sort of fraud, but just not being able to pay your bills doesn't mean you can go to jail. Of course, there is very little protecting you from simply running out of money and becoming homeless, but that's not your question." "There absolutely is a specific model that makes this so popular with so many credit card companies, and that model is ""per transaction fees"". Card companies also receive cost-sharing incentives from certain merchants. There is also a psychological reasoning as an additional incentive. When you want to accept credit cards as a source of payment as a business, you generally have three kinds of fees to pay: monthly/yearly subscription fees, percentage of transaction fee, and per transaction fee.  The subscription fees can be waived and sometimes are expressed as a ""minimum cost"", so the business pays a certain amount whether you actually have people use credit cards or not. Many of these fees don't actually make it to the credit card companies, as they just pay the service providers and middle-men processing companies. The percentage of transaction fee means that the business accepting payment via credit card must pay a percentage usually ranging from 1-3% of the total transactions they accept. So if they get paid $10,000 a month by customers in the form of credit cards, the business pays out $100-300 a month to the credit card processor - a good portion of which will make it back to the credit card issuing company, and is a major source of income for them. The per transaction fee means that every time a transaction is run involving a card, a set fee is incurred by the business (which is commonly anywhere from $0.05 to $0.30 per transaction). If that $10,000 a month business mentioned previously had 10 customers paying $1,000 each at $0.10 a transaction, that's only $1 in fees to the credit card processors/companies. But if instead that business was a grocery store with an average transaction of $40, that's $25 in fees.  This system means that if you are a credit card company and want to encourage people to make a specific kind of purchase, you should encourage purchases that people make many times for relatively small amounts of money. In a perfect world you'd want them to buy $1 bottles of water 5 times a day with their credit card. If the card company had 50,000 card holders doing this, at the end of 1 year the company would have $91,250,000 spread across 91,250,000 transactions. The card company might reasonably make $0.05 per transaction and %1 of the purchase total. The Get Rewarded For Drinking More campaign might earn the card company $912,500 in percentage fees and over $4.5 million in transaction fees. Yet the company would only have to pay 3% in rewards from the percentage fees, or $2.7 million, back to customers. If the card company had encouraged using your credit card for large once-yearly purchases, they would actually pay out more money in rewards than they collect in card-use fees. Yet by encouraging people to make small transactions very often the card company earns a nice net-income even if absolutely every customer pays their balance in full, on time, and pays no annual/monthly fees for their card - which obviously does not happen in the real world. No wonder companies try so hard to encourage you to use your card all the time! For card companies to make real money they need you to use your credit card. As discussed above, the more often you use the card the better (for them), and there can be a built-in preference for small repeated transactions. But no matter what the size of transaction, they can't make the big bucks if you don't use the card at all! Selling your personal information isn't as profitable if they don't have in-depth info on you to sell, either. So how do they get you to make that plastic sing? Gas and groceries are a habit. Most people buy one or the other at least once a weak, and a very large number of us make such purchases multiple times a week. Some people even make such purchases multiple times a day! So how do people pay for such transactions? The goal of the card companies is to have you use their product to pay as much as possible. If you pay for something regularly you'll keep that card in your wallet with you, rather than it getting lost in a drawer at home. So the card companies want you to use your card as a matter of habit, too. If you use a card to buy for gas and groceries, why wouldn't you use it for other things too? Lunch, dinner, buying online? If the card company pays out more and makes less for large, less-regular purchases, then the ideal for them is to have you use the card for small regular purchase and yet still have you use the card for larger infrequent purchases even if you get reduced/no rewards. What better way to achieve all these goals than to offer special rewards on gas and groceries? And because it's not a one-time purchase, you aren't so likely to game the system; no getting that special 5% cash-back card, booking your once-per-decade dream vacation, then paying it off and cancelling it soon after - which would actually make the card company lose money on the deal. In the end, credit card companies as a whole have a business model that almost universally prefers customers who use their products regularly and preferably for small amounts a maximum number of times. They want to reduce their expenses (like rewards paid out) while maximizing their revenue. They haven't figured out a better way to do all of this so well as to encourage people to use their cards for gas and groceries - everything else seems like a losing proposition in comparison. The only time this preference differs is when they can avoid paying some or all of the cost of rewards, such as when the merchants themselves honor the rewards in exchange for reduced or zero payment from the card companies. So if you use an airline card that seems to give you 10% back in airline rewards? Well, that's probably a great deal for the card company if the airline provides that reward at their own expense to try to boost business. The card company keeps the transaction-related fees and pays out almost nothing in rewards - the perfect offer (for them)!  And this assumes no shenanigans like black-out periods, ""not valid with any other offers"" rewards like on cars where only a fool pays full MSRP (and sometimes the rewards are tagged in this sort of way, like not valid on sale/clearance items, etc), expiring rewards, the fact that they know not everyone uses their rewards, annual fees that are greater than the rewards you'll actually be obtaining after accounting for all the other issues, etc. And credit card industries are known for their shenanigans!" This is a super contentious topic but we have to have a floor wage because we don't have a free labor market.  In order for the labor market to come up with a fair wage the market must be as close to de-regulated as possible. But we've already seen what happens in an unregulated (or low regulation) market - safety problems, child labor, abysmal wages.  Just ready a history book to see how the US clamped down on sweat shops, child labor and the rise of the Unions.   No one wants to work like that so we put regulations in place to fix those things. This is why we have safety laws and rules to prevent our employers from stealing wages due to filing a report late or other stupid excuse.   So we make the work places safer, and put protections in to make sure people get paid. But now we created a wage floor. Businesses are literally designed to make profit and you make profit by trimming all your expenses as much as necessary. Skilled employees have an easier time negotiating wages and they can band together in unions. But low skilled and unskilled workers don't have this ability  so they work for minimum wage.   Now regardless of a company's ability to pay their workers $15/hr or not, if you create a wage floor than don't account for yearly COLA/inflation workers get left behind. Why does this matter? There is a strong relationship between crime and poverty. So we decide to create social programs to keep crime down. But as the wage floor is not increased, min wage workers require more government subsidy.   Either companies pay their employees enough where full time workers don't qualify for government subsidy or the government/tax payer ends up picking up the tab on behalf of these companies.   You can't actually quantify the relationship between min wage and labor because it's not just a labor issue. It impacts crime, health (who has the ability to pay a $30 co pay if you're chronically ill on min wage?), and government social welfare on local,state and federal levels.   We can't just demand that unskilled labors get skills so they get more money because that will end up devaluing skilled positions. Right now people argue that skilled positions are devalued when min wage increases. And that's true only if your employer fails to provide a like increase. In addition to the money-laundering, lifestyle, income tax, etc  issues discussed already in other answers, one other matter that  might concern the bank is whether that cash you are bringing in  to deposit is genuine currency or (some or all of) the bills  are counterfeit and you are using this mechanism to get them into  circulation.  Even if you withdraw a very large amount in cash from your bank, step out the door and come back just a few minutes later saying that you have changed your mind and want to put that money back into your account, there is still the question  as to whether the cash you have brought back is exactly the same as you took out or a substitution was made in the interim. I once needed a bank draft for $1000 and went to my bank to get it, taking with me a check made out to Cash for $1003 (the bank's fee was $3). The bank would not give me a bank draft in exchange for the check, or if I cashed the check right then and there and paid for the bank draft using the cash that the teller had just handed me. I had to tear up the check, write another one payable to the bank, and then I got my bank draft. As JoeTaxpayer says, it is a matter of paper trail. Additional matter added in edit: According to Wikipedia, because of the  Bank Secrecy Act of 1970, Many banks will no longer sell negotiable instruments when they are purchased with cash, requiring the purchase to be withdrawn from an account at that institution. which was exactly my experience.  Furthermore, even the banks that will still sell you a cashier's check or money order for cash must keep a Monetary Instrument Log (MIL) that records all such cash transactions for amounts between $3000 and $10,000, keep the records for at least five years, and produce it upon request of a bank examiner or auditor (and presumably upon subpoena by a district attorney or divorce lawyer). Cash transactions of $10,000 or over are, of course, reported to the IRS on Currency Transaction Reports.  In short, a paper trail exists for some time even for cash transactions quite a bit smaller than $10,000. Mastercard rules also prohibit asking for ID along with the card. Yet, when I was at Disneyland, years ago (so I don't know if this is still a practice) they asked for my driver's license with every purchase. I can charge up to $200 at Costco with a swipe, not even a signature, but a $5 bottle of water (maybe it was $6) required me to produce my license.  The answer is Pete's comment, don't patronize these merchants. By the way, it's legal now. From Visa web site -  Note - 9* states still prohibit surcharges, so they tend to offer cash discounts. The question you linked is from 2010, things change. This is a question with a flawed premise.  Credit cards do have two-factor authentication on transactions they consider more at risk to be fraudulent.  I've had several times when I bought something relatively expensive and unusual for me, where the CC either initially declined and sent me a text asking to confirm immediately (after which they would approve the charges), or approved but sent me a text right away asking to confirm (after which they'd automatically dispute if I told them to).  The first is legitimately what you are asking for; the second is presumably for less risky but still some risk transactions). Ultimately, the reason they don't allow it for every transaction is that not enough people would make use of it to be worth their time to implement it.  Particularly given it slows down the transaction significantly (and look at the complaints at the ~10-15 seconds extra EMV authentication takes, imagine that as a minute or more), I think you'd get a single digit percentage of people using that service. When the market isn't allowed to favor one currency (provider) over another, there must be a central authority with the power to regulate, provide, and insure it. People don't learn the dangers of fractional reserve banking and the resulting expansions and contractions of the money supply when the providers of the currency aren't allowed to fall, taking the savings of depositors with them. Insuring people against the dangers of mismanaged money guarantees the mismanagement of money. The only issue I can see is that the stranger is looking to undervalue their purchase to save money on taxes/registration (if applicable in your state). Buying items with cash such as cars, boats, etc in the used market isn't all that uncommon* - I've done it several times (though not at the 10k mark, more along about half of that). As to the counterfeit issue, there are a couple avenues you can pursue to verify the money is real: *it's the preferred means of payment advocated by some prominent personal financial folks, including Dave Ramsey