There is also much misunderstanding about the notion that bank records in the United States are "open" while those in a country like Switzerland are "secret." In the United States, as in all countries that respect individual freedom, bank records are private. U.S. banks, as a matter of common law, are liable to their customers for damages if, without consent or proper legal compulsion. they disclose information about the accounts of their customers. The image of the Swiss banks as veiled in secrecy for the sake of criminals and tax evaders is strikingly lacking in objectivity. It overlooks the fact that, in Swiss criminal procedure, a bank cannot refuse to release information-a duty that also applies to third countries-provided the offense for which a foreign authority seeks Swiss legal assistance also punishable in Switzerland. This is no different than the situation in the United States, for any effort by foreign law enforcement agencies to obtain records in a U.S. bank would be rejected in the absence of a subpoena issued by a court of competent jurisdiction in the United States. In the Swiss view, tax matters and currency controls of foreign countries are regarded as of no concern to Swiss justice. It is the task of each individual nation to create for itself the legal order, political institutions and fiscal and monetary conditions that will induce confidence in its citizens that their private property will not be eroded by inflation or expropriated without genuine compensation. BURDENS ON THE PUBLIC Currency controls would involve not only intangible costs but also many tangible burdens on the American public. First of all, the contemplated legislation would impose record-keeping requirements including massive photocopying of checks-substantially beyond existing banking practice. The numbers of checks flowing through the banking system is projected to reach about 23 billion this year. It is true that the House Committee bill (but not the Committee's Chairman) would exclude from the photocopying requirements domestic (but not foreign) financial transactions involving less than $500; but, even so, the end-result would be mounds of microfilm and paper. The specific records buried in these mounds would have to be retrieved whenever needed; and the systems of retrieval suitable for currency-control purposes would have to cut through the present systems geared to the requirements of the banks' own business and that of their customers. All of this would result in sizable increases in banking costs and charges to individuals and businesses engaged in legitimate trade. Furthermore, the photocopying, record-keeping and reporting requirements— superimposed upon the tightly scheduled and highly automated check collection processes-would inevitably slow down the flow of funds. The controls would thus run counter to current persistent efforts to make funds available to the payee at the earliest possible moment. It may be argued that these technical difficulties, inconveniences and costs would be quite acceptable if currency controls could effectively help in detecting and prosecuting criminals and tax evaders. The difficulty with this contention is. of course, that dishonest people are masters in avoiding or circumventing regulatory procedures or in conducting transactions in ways that leave no trail. WEAKENING CONFIDENCE ABROAD At stake is not only the right of Americans to conduct their business and monetary affairs in privacy but also the future of the dollar as the major currency in which businessmen, investors and bankers outside the United States effect payments and keep parts of their working balances, reserves and savings. Banking is increasingly international and mobile. The flow of funds is influenced by the legal and regulatory climate in various centers. It is possible that foreigners would hesitate to keep deposits or securities in a country that fails to provide reasonable protection against indiscriminate disclosure of private information. They know from experience that controls, more often than not, beget more controls, and might regard the type of currency surveillance envisaged by the bills now pending in Congress as a beginning of exchange restrictions. Furthermore, the proposed legislation would remain on the books permanently-not just provide a framework for emergency measures that could be lifted by administrative action when they became unnecessary. All this could induce individuals and corporations abroad to consider alternative methods of holding working balances, reserves and savings, including portfolio investments in the United States. Private individuals, banks and other businesses outside the United States maintain close to $30 billion of deposits and other short-term assets in U.S. banks. This figure includes accounts owned by U.S. citizens and corporations residing or doing business abroad. Other accounts are held by foreign nationals and corporations. If only a part of this $30 billion pool of dollar funds were to be transferred from banks in the United States to banks abroad-banks able to provide comparable services under conditions assuring better security against indiscriminate disclosure of private banking transactions to government agencies the result might well be a reshuffling of funds that would disturb sensitive money and capital markets. Sooner or later, a lessening of confidence might well induce private holders to convert some of their short-term dollars into other currencies. In addition, foreign nations are also holding some $30 billion in U.S. corporate stocks and long-term securities. If only a part of the $60 billion total of foreign-held shortand long-term assets were withdrawn, such conversions would lead to a buildup of dollars in the hands of foreign governments and central banks, which already hold dollar reserves in excess of $13 billion. The use of the dollar as a reserve currency is predicated on its use as a vehicle for private transactions. The ability to use and invest dollars freely is an essential and vital element in international trade and investment. As the U.S. Treasury has emphasized : The overwhelming bulk of the rapidly growing volume of international transactions by Americans and foreigners alike are not only legitimate business and personal transactions, but serve the larger interests of the United States in effective monetary arrangements and freely flowing trade and payments. STATEMENT OF S. DAVIDSON HERRON, JR., FINANCIAL VICE PRESIDENT, The following is a brief statement of the position of INA Corporation on the subject of Senate Bill S. 3678, dealing with financial record keeping and reports of currency and foreign transactions. INA Corporation is perhaps uniquely affected by this bill before your committee; while we are not a banking institution, our corporate family influences a number of the other financial institutions enumerated in the bill, and directly affected by its provisions. Our subsidiaries include a registered broker-dealer, an investment banker, several insurance companies, and other businesses performing related functions. At the outset, I would like to state that INA Corporation concurs in the expressed purposes of this proposed legislation, and is anxious to cooperate in the formation of an efficient and effective process for the accomplishment of those purposes. We fully appreciate the difficulty of structuring a mechanism which will facilitate the detection and prosecution of fraudulent and illegal use of financial institutions and which, at the same time, will not impose an impediment on the free flow of domestic and international commerce. We concur in that testimony before the House Banking and Currency Committee, and other testimony before your committee, supporting the need for fairly broad discretionary powers for the Secretary of the Treasury in order to effect the purposes of such legislation. We also believe that these broad and extraordinary powers should be conferred with an explicit purpose, upon a showing of necessity, and with adequate guidelines to indicate the legislative intent in conferring such powers. In the fields of investment banking and securities broker-dealerships, our views are substantially in accord with those of other institutions and regulatory associations and agencies in these fields. Testimony of other witnesses has illus trated that, under certain very special circumstances, such institutions may be used to execute and to conceal illegal and fraudulent monetary transactions. We presume that, in the execution of his extraordinary powers, the Secretary of the Treasury would confine himself to those specific practices and instances which are known to be used for such purposes, or which are likely to be used for such purposes, and where the ordinary record keeping and other business practices do not accommodate detection and prosecution We are particularly concerned with the extension of this proposed legislation to include insurance companies. Throughout the testimony on the House side, and in the testimony thus far before this committee, we find no indication that insurance companies have been used for such illegal purposes, nor even a hypothetical example of how they might be used. Furthermore, there has been no indication to date that the record-keeping practices of the insurance industry impede criminal investigation or prosecution. The history of this legislation to date would give the Secretary absolutely no guidelines relating to the insurance industry, and provide no indication as to what records should be kept, or what reports should be required. Insurance Company of North America is one of the oldest and largest insurance companies in the United States. It has historically been an international insurer, operating throughout the world through foreign branches of the U.S. corporation and through foreign subsidiaries. With our special knowledge of this field, and with our understanding of the purposes of this legislation, we can find no reason why insurance companies should be included among the other financial institutions enumerated in this proposed legislation, and no reason why insurance transactions should be included under the record-keeping requirements. The inclusion of insurance companies creates ambiguities in the bill. For example, the authority of the Secretary under Title I to require maintenance of records extends to persons engaged in the business of transferring funds or credits domestically or internationally. In the absence of an exclusion, it is not clear whether this authority extends to insurance companies. Furthermore, there is no showing that the records customarily kept by insurance companies will not accommodate criminal investigation and prosecution. Section 122 authorizes the Secretary to require uninsured institutions to make reports to the Secretary regarding the ownership, control or management of such institutions. Any such requirement in the case of insurance companies would duplicate existing laws and regulations regarding the regulation of ownership and control of insurance companies. The monetary transactions of insurance companies are ordinarily conducted through banking institutions. Application of the provisions of this legislation to both the insurance companies involved, and to the banking institutions processing their transactions, would result in wasteful duplication. The addition of insurance companies to the proposed legislation is without any public background or legislative history. We respectfully propose that insurance companies be deleted from the definition of "financial institution" in Title II and that insurance companies be exempted from the record keeping and reporting requirements of the proposed legislation. If this proposal requires further support, it is respectfully suggested that additional hearings be scheduled to give the insurance industry and insurance regulatory agencies an opportunity to present their views. I would like to reiterate our desire to contribute to the development of legislation appropriately directed to the express purposes of this bill. We would be happy to respond to any request by the committee or its staff for additional information. INDEPENDENT BROKER DEALERS' TRADE ASSOCIATION, Senator WILLIAM PROXMIRE, Washington, D.C. DEAR SENATOR PROXMIRE: While our organization represents only about ten percent of the registered securities dealers, they are small businessmen and are the first persons injured and the last to recover from any diminution in securities trading volume, any reduction in sales compensation, any lowering of underwriters compensation, etc. Therefore we have a serious and continuing interest in any action, private or public, which threatens to adversely affect the depth, continuity and liquidity of our securities markets. both listed and OTC. We think it would be a serious mistake for Congress to enact the proposed amendment to Section 7(a) of the Securities Exchange Act of 1934, which would apparently stop American investors, American borrowers, American brokers, and foreign lenders and borrowers from obtaining credit to finance the purchase and sale of securities from foreign banks or other sources on more favorable terms than those permitted by U.S. margin requirements promulgated by the Federal Reserve Board. This will obviously stop a lot of trading in American appeal." (Pactor Corp. v. Manpower Inc., 252 Cal. App. 2d 1032, 1034.) It will suffice to say that plaintiff has made absolutely no attempt to show any prejudicial effect of the trial court's error. Since the order sustaining the demurrer was general in its terms, impliedly the ruling was made either without consideration of the special grounds urged by defendants, or on a determination that they were not well taken. In order to give plaintiff the benefit of every possible doubt, we will therefore assume that the demurrer was sustained on the broad ground that the complaint did not state a cause of action.1 (See Cohen v. Superior Court, supra, at page 655.) The third complaint is in four causes of action: (1) breach of contract; (2) invasion of privacy; (3) malicious injury; and (4) tortious intermeddling in private litigation. Plaintiff's entire case is based upon the allegation of defendant Johnston's disclosure to her husband's attorney that she had withdrawn the funds from defendant Surety. Breach of contract. A complaint which attempts to state a cause of action for breach of contract is defective if it fails to allege facts showing that the damages recited were a result of defendant's breach. (See generally, 2 Witkin, California Procedure, § 262.) Plaintiff's allegations of general damages, which occur in two separate paragraphs of the complaint, are as follows: "That defendants did achieve the result intended by them; the result intended by them [sic]; that as a proximate cause of their actions above alleged in invading the marital privacy of plaintiff and in intermeddling in the divorce litigation and in hampering the reconcilation [sic] prospects of plaintiff, the the [sic] defendants did hamper and destroy the reconciliation prospects of plaintiff; that the present value of plaintiff's reconciliation prospects was $40,000 at the time of destruction based on the total value of the continuation of her marriage adjused by computer for hazard from other sources and divided by other difficulties inherent in matrimony; that accordingly, plaintiff was damaged in the sum of $40,000; the defendants intended to cause plaintiff serious mental suffering and bodily harm by so invading her marriage privacy and by so intermeddling in her litigation; that defendants intended to cause plaintiff agony [sic] and anguish; that as a proximate cause of the actions above alleged plaintiff was caused serious mental suffering and bodily harm and agony and anguish, all to her damages in the sum of $100,000. . . . That as a further proximate cause of the breach of confidence of the Defendant Savings and Loan Association by the unauthorized disclosure of facts concerning the Plaintiff's financial condition to her opponent in the litigation, that it to say to her husband, by disclosing this matter to her husband's attorney, the Plaintiff did suffer detriment in that when she went to trial, the burder [sic] of her litigation was measurably increased in this: that prior to the disclosure of these confidences to the husband, the state of the litigation was such that it was probable that the Plaintiff, who had been married to her husband, some thirty-odd years would be awarded the family home, and said family home was at that time, of a reasonable fair-marked market value of $28,000.00 and was not encumbered; that as a proximate cause of the breach of the agreements mentioned above by the Association in its disclosure to the Attorney for the husband, the litigation went in such a way, because of the added increased burden put upon the Plaintiff by the disclosure, that the Plaintiff was only awarded an undivided one-half interest in the proceeds of the sale of the family home, and accordingly, the Plaintiff was damaged by the breach of said contract, in the amount of $14,000.00." Such statements are patently defective. Nothing in the complaint shows any causal connection between defendants' act and plaintiff's so-called "damage." Indeed, defendants' innocuous action appears totally unrelated to the catastrophic consequences alleged by plaintiff. In regard to plaintiff's claim that the disclosure destroyed her reconciliation prospects, it is worthy of note that plaintiff herself was the one who initiated the divorce litigation. Her contention is incongruous to say the least. Plaintiff contends that defendants "admit the breach, admit the damages," relying on the rule that on appeal from a judgment sustaining a demurrer, the allegations of the complaint are deemed admitted. Plaintiff, however, overlooks one of the qualifications to this rule that a demurrer does not admit conclusions of fact or law. (Page v. Insurance Co. of North America, 256 Cal.App.2d 374, 377.) It is clear that plaintiff's allegations of damage are mere conclusions, and not facts from which these conclusions could be deduced. 1 Accordingly, defendants' claims that portions of the complaint were uncertain, unintelligible and ambiguous, claims which can only be raised by special demurrer, will not be considered. Messrs. McKenna & Fitting, for Defendants and Respondents. This is an appeal for a judgment of dismissal following an order sustaining a demurrer to plaintiff's third amended complaint without leave to amend. STATEMENT OF FACTS We are bound by the well-settled principle that on appeal from a judgment sustaining a demurrer to a complaint, it must be assumed that the plaintiff can prove all facts as alleged. The facts herein are therefore merely a restatement of plaintiff's allegations. On August 3, 1965, the plaintiff, Eleanor Ann Summers, deposited $3,871.12 with defendant Surety Savings and Loan Association (hereinafter called Surety). Plaintiff claimed these funds were her sole and separate property. At the time the deposit was made, plaintiff was having marital difficulties with her husband. On January 27, 1966, plaintiff initiated a divorce action against her husband. The final decree granting the divorce was entered on February 15, 1967. On February 7, 1966, immediately after plaintiff filed for divorce, plaintiff's husband obtained a restraining order directed to Surety which prohibited the withdrawal of any funds from the account which had been opened by plaintiff. On February 18, 1966, the restraining order was dissolved. Shortly thereafter, plaintiff withdrew the balance of her account, amounting to approximately $4,800.00, and deposited the money with another financial institution. Upon the withdrawal of the funds by plaintiff, James B. Johnston, Assistant Vice-President of Surety and codefendant herein, notified plaintiff's husband's attorney that the funds had been removed. Johnston also disclosed the name and location of the institution where the money was ultimately deposited. On November 15, 1966, plaintiff filed a complaint for damages against defendants, alleging breach of contract, invasion of privacy, and malicious injury. Defendants demurred on the ground, inter alia, that plaintiff had failed to allege facts sufficient to constitute a cause of action. The demurrer was sustained with leave to amend. On March 2, 1967, plaintiff filed an amended complaint which was virtually identical with the original complaint. Defendants demurred, and again it was sustained with leave to amend. Plaintiff's third complaint was filed on June 20, 1967. Except for the addition of a new cause of action entitled "tortious intermeddling in private litigation,' it was substantially the same as the two previous complaints. A demurrer was again sustained, this time without leave to amend. A judgment of dismissal was entered from which plaintiff appeals. ISSUES Two issues are presented by this appeal: (1) Whether plaintiff's third complaint alleged facts sufficient to constitute a cause of action, and (2) If it did not, whether the trial court abused its discretion by not granting plaintiff further leave to amend. SUFFICIENCY OF COMPLAINT In addition to the task of trying to interpret plaintiff's rambling complaint, our problem is complicated by the fact that the record does not contain the specific ground or grounds upon which the trial court sustained the demurrer. Section 472 (d) of the Code of Civil Procedure provides in part: "Whenever a demurrer in any action or proceeding is sustained, the court shall include in its decision or order a statement of the specific ground or grounds upon which the decision or order is based... " Although such failure by the trial court was error (Mack v. Hugh W. Comstock Associates, 225 Cal. App. 2d 583, 590) plaintiff in this case may not benefit from it. When ever a plaintiff fails to call the trial court's attention to the failure to state specific grounds for sustaining a demurrer, the error is waived. (Mack v. Hugh W. Comstock Associates, supra, at page 590; Cohen v. Superior Court, 244 Cal. App. 2d 650, 655.) There is nothing in the record to enlighten us as to whether plaintiff interposed any objection. Even if we assume that proper objection was made, nevertheless, for such error to justify a reversal there must be an affirmative showing of prejudice. "The burden is on an appellant to establish the existence of prejudicial error affecting the merits of the |