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The European Union has now officially joined the growing number of Internet stakeholders who object to ICANN’s wholesale expansion of the DNS, particularly with respect to financial TLDs like .bank or .fin. In a letter to ICANN, the European Banking Authority concluded, “…that there are many supervisory concerns surrounding the operation of the proposed TLDs by the ICANN, relating mostly to the great potential, according to the EBA view, for misuse by unscrupulous individuals, and that, therefore, any plans for their operation should ideally be discontinued.” In comments also filed with ICANN, The EBA noted that customers relying on the bank TLD may assume the TLD operator is a “regulated entity, under supervision by a competent authority” when, in fact, it is not. The EBA also expressed concern that the new TLDs would “not be linked to a specific country, to a specific supervisor or to a specific regulatory framework.” Thus, a consumer might not know if he or she is dealing with a bank in their jurisdiction, one that is properly regulated, or one that has adequate assets to protect a consumer’s assets. In expressing its concerns, the EBA noted that “websites could also be used to conduct new types of frauds, giving way to a more dangerous kind of phishing and scams.”

On the broader issue of why any new financial TLDs are necessary, the EBA noted:

- The yet unproven benefit from the establishment and use of such TLDs;
- Technical issues that remain unresolved in how security and other important issues will be addressed and resolved;
- The potential use of the proposed TLDs by entities located in any part of the world (where supervision may be lacking);
- The “potential creation of moral hazard and/ or (over)reliance on what might be perceived as a regulatory endorsement” of the companies operating under such TLDs.

The EBA warns ICANN that if it should go forward despite the EBA’s concerns, it will issue a “public consumer alert, warning consumers of banking services to the risks of these new naming conventions and the need to be pro-active in checking that the website a consumer uses is indeed the site of a regulated entity.” So much for instilling all the consumer confidence ICANN claims will occur with such new TLDs.

So once again, serious concerns have been raised on the harm consumers will suffer as a result of ICANN’s reckless proposals. It should not go without notice, however, that the only remedy the EBA appears to believe it has is to issue a warning if ICANN ignores them. If one needs any more evidence of how unaccountable ICANN has become, one need only look at how impotent government regulators like the EBA appear to be to stop them.

Doug Wood, We Expert

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