Skip to comments.HSBC Bank Blocking Large Withdrawals Without ‘Evidence’ Of Spending Need (UK)
Posted on 01/27/2014 7:44:07 AM PST by RetiredArmy
HSBC Bank Blocking Large Withdrawals Without Evidence Of Spending Need
It seems that the bank, HSBC, has been a little overzealous in the implementation of some new, well meaning regulations, and now has egg on its face. Recently, some HSBC customers were prevented from withdrawing large amounts of cash because they could not provide evidence of why they wanted it. Apparently, customers were prevented from withdrawing amounts ranging from £5,000 to £10,000.
HSBC admitted it has not informed customers of the change in policy, which was implemented in November, but the bank says it has now changed its guidance to staff.
Stephen Cotton went to his local HSBC branch this month to withdraw £7,000 from his instant access savings account to pay back a loan from his mother.
A year before, he had withdrawn a larger sum in cash from HSBC without a problem, but this time it was different. He told a reporter from Money Box: "When we presented them with the withdrawal slip, they declined to give us the money because we could not provide them with a satisfactory explanation for what the money was for. They wanted a letter from the person involved."
Mr Cotton says the staff refused to tell him how much he could have: "So I wrote out a few slips. I said, 'Can I have £5,000?' They said no. I said, 'Can I have £4,000?' They said no. And then I wrote one out for £3,000 and they said, 'OK, we'll give you that.' "
He asked if he could return later that day to withdraw another £3,000, but he was told he could not do the same thing twice in one day.
He promptly wrote a complaint to HSBC about the new rules and also that he had not been informed of any change, and was told by the bank that they were under no obligation to tell him, explaining that As this was not a change to the Terms and Conditions of your bank account, we had no need to pre-notify customers of the change.
Mr Cotton struggled to understand the banks attitude, and he was not alone. "I've been banking in that bank for 28 years. They all know me in there. You shouldn't have to explain to your bank why you want that money. It's not theirs, it's yours." He said of the incident.
Peter from Wiltshire, who asked that his surname be withheld, had an eerily similar experience. He wanted to take out £10 000 cash from HSBC, some to pay to his sons and some to fund his long-haul travel plans.
Peter called the bank the day before to let them know in advance, and everything seemed to be fine, but the next day he got a call from his local branch asking him to pay his sons via a bank payment and to provide booking receipts for his holidays. Peter did not have any booking receipts to show.
The following day he spoke to HSBC again and this time, having examined his account, it said he could withdraw the £10,000.
Two specific examples of a phenomenon that has been growing increasingly common.
HSBC has said that it was responding to the negative feedback about the new practice and evaluating how the policy was being implemented. "We ask our customers about the purpose of large cash withdrawals when they are unusual and out of keeping with the normal running of their account. Since last November, in some instances we may have also asked these customers to show us evidence of what the cash is required for."
Money Box asked other banks what their policy is on large cash withdrawals. All said they reserved the right to ask questions about large cash withdrawals, but none said they would require evidence of what the money was being used for before paying out.
Douglas Carswell, the Conservative MP for Clacton, is alarmed by the new HSBC policy: "All these regulations which have been imposed on banks allow enormous interpretation. It basically infantilizes the customer. In a sense your money becomes pocket money and the bank becomes your parent."
But Eric Leenders, head of retail at the British Bankers Association, said banks were sensible to ask questions of their customers: "I can understand it's frustrating for customers. But if you are making the occasional large cash withdrawal, the bank wants to make sure it's the right way to make the payment."
At the root is the question, What is driving this unusual policy? What could be happening behind the scenes to make something draconian and arbitrary like this seem like a good idea to the banks decision makers?
On the surface, there seems to be nothing, but a deeper look by people who would know, such as a group called Forensic Asia, which is a Hong-Kong based research firm, recently issued a sell recommendation for HSBC, on the basis of questionable assets on its balance sheet.
In a recent report by The Telegraph, the analysts involved actually worked at HSBC for some 15 years, and suggest that the giant bank could have overstated its assets by more than £50bn and ultimately need a capital injection of close to £70bn before the end of this decade.
They went on to say "HSBC has not made the necessary adjustments, during the quantitative easing reprieve...The result has been extreme earnings overstatement, causing HSBC to become one of the largest practitioners of capital forbearance globally... This charade appears to be ending."
SORRY FOR THE ALL BOLD. It simply would not correct. I used the </b> and it still did not work. So, sorry for the bright bold.
It’s a bank policy, not a governmental policy. If US banks wanted to, they could do it today. They don’t need an EO from anybody.
FDR did this to my great aunt during the Depression.
No doubt why the family found $30,000 stuffed in her mattress after she died.
Try that, and see what they say:
"May we please see the ransom note? No note? Sorry, no cash. It's bank policy. See if the kidnappers will take a bank check, or a wire transfer. And thank you for banking with HSBC, and have a really great day!!!"
OK, it's easier to read without those silly reading glasses!
This could actually protect the savers though.
A run on the bank and many would lose everything.
Happened here in 1929.
HSBC new feature ,holding your money for ransom
Such as they limit how many transfers per month you are allowed to make from savings to checking before you are assessed a fee. But you can make as many withdrawals from savings through an ATM with no fees. (USBank)
Brits should tell their bankers:
“I need to buy a TANK to protect myself from TYRANNY!!!!”
So, your okay with you go down to the bank. Say you have $100,000 in savings and want $15,000 to BLOW. You hand them the withdrawal slip and they say NO! You say I want my $15k to blow in Vegas. They say NO. You cannot have it. Go away. So your telling me your okay with this policy??? Really???
How about It's My ***king Money!!!???
In the case of the US the Fed creates new $$$ from nothing to handle bank runs, which pretty much prevents them,
But in England they cant just create the currency so if they don't prevent a bank run then many customers will be screwed for good. "So your telling me your okay with this policy??? Really???" HAHA
Banks make $$$ by loaning it out. They cant just call a homeowner and demand full payment on a mortgage on the spot.
None of their damn business.
Not their damn business.
Its not the banks business to take steps to make sure that their savers money that they took is not lost?
I am finding that a bit illogical especially given the theme of this thread.
No it is not.
The business of the bank is to take deposits, use those deposits to make loans, and to pay out drafts on those deposits.
It is NOT the business of the bank what you want cash for or what you intend to do with it.
You aren't big on freedom, are you?