to want to close my bank account after this gross invasion of privacy?

[somanymiles]

I went to get cash out of my bank account this morning to pay the builders (£6,000) and was told I could not take that amount out without hard copy proof of what I was spending the money on eg an invoice. I was given no notice of this so of course did not have anything except a quote on my phone which they did not accept, even though I offered to email it to them. This was not a question of confirming my identity- it was that they have a new policy where you gave to prove what you are spending your cash on. When I asked what the threshold was for the new policy I was told they were not allowed to tell me. I am furious. Surely what I spend my money on us nobodies business but mine. It certainly isn't HSBC's business.I am thinking of closing my accounts there with all the hassle that will entail. AIBU?

Good lord.

I've been asked what I intend to do with large sums before, but never asked to prove it :-S

I'm sure it's for your own protection •coughs* just incase it's ransom money or you're being forced to withdraw it by hooded youths

Of course you can feel pissed off by being inconvenienced the bank doing this, but these regulations are in place for very good reasons, without AML restrictions it would be very easy for dangerous and illegal organisations ( Al Qaeda, mafia, drug cartels etc) to move around and profit from their illegal activities. So what is a minor inconvenience to you is actually helping make criminals lives significantly more difficult, and even saving lives in the bigger picture yes I've done a few AML courses.

Move around money.

Yes, i think YABU. i had to drive from Belgium to England to transfer some money for a house sale.
I was inconvenienced, but didn't consider closing my account down.

They did this at the Halifax when i paid in a 5.5k cheque.

It is money laundering regulations as many have said, and not them being nosey or twunts.

Caitlin's posts are a prime example of what over zealous employees will do with general guidance. They will interpret it to maximally protect themselves at the expense of inconveniencing their clients. Then they will shelter under a catch-all excuse such as alm, or tax evasion.

Withdrawing cash is not a crime. Paying workmen cash is not a crime. It is not an individual's responsibility to ensure that people that they do business with manage their tax affairs honestly. Funny how banks are v interested in paying builders a few k in cash, yet have other departments advising ftse 100 companies how to minimise (with dubious legality) their 'tax liability'.

At the moment, due to low interest rates, banks have v little interest in savers. Once interest rates go up, their attitudes will change.

Princess.

Some people just prefer to deal in cash, both the service provider and its receiver.

HSBC can ask you what u want it for, but it is none of their bloody business. And besides, who is to say you are telling the truth? And why should that matter?

Paying tradespeople cash is very normal. Once they are in receipt of their cash, its up to them what it is spent on, tax or no tax.

Btw, have never spoken to a London taxi driver who has declared income for tax. They mostly fiddle the system by accepting cash only. Oddly, I don't mind...!?

In addition, the safest way for an individual to take payment is in cash. For instance, if I sold my car privately, I would only take cash, even banker's drafts can be forged.

I wouldn't agree that it's a "gross invasion of privacy" to ask you what you are spending your money on. I would be annoyed if the cashier said that I had to "prove it" though.

As others have said, it is likely that other banks are doing the same thing as they all will be more concerned with showing the authorities that they are following regulations than worrying about whether you keep your money with them.

In your position I probably would move bank accounts as it would make me feel better and there are better banks than HSBC anyway. I wouldn't waste my time complaining though.

In addition, the safest way for an individual to take payment is in cash. For instance, if I sold my car privately, I would only take cash, even banker's drafts can be forged.

Nowadays you can pay via BACS electronic payments or direct money transfers though. I wouldn't hand over thousands in cash.

If you can prove who you are, then it's up to you and no-one else to decide what you're going to spend your money on. There is no need for the bank to know. It would be better if they'd offer information and advice about how to avoid rogue traders etc, regardless of who may be spending what (and most amounts going to unscrupulous traders won't be thousands).

Whatever,

Only cash can be guaranteed to be exchanged simultaneously with goods. Any other method allows one party to be in receipt of goods and money at the same time, creating risk for the other party.

The government may have created guidelines for banks to watch for certain kinds of money movement, but to the best of my knowledge they have not passed laws requiring me to actively assist the banks in this.

There seems to be an assumption that now we know why they do this we must cooperate voluntarily.

I understand the government's motives. Unfortunately the solution to all problems for a government will be to take away rights from individuals and introduce more and more controls. It's a known problem with all governments.

It's not about being difficult for the sake of it. It's about resisting the gradual erosion of privacy.

It's easy to say things like 'it's not a big deal' and 'why make a fuss', but it's essential to resist small, and probably well intentioned, changes that have us being required to prove we are innocent.

Why didn't you ask for a bankers draft? There is no way I would feel comfortable walking out of a bank with 6 thousand pounds in my bag. What if someone saw the withdrawal and attacked you?

Sounds like a good excuse to pay a cheque instead of cash. I would never pay that much cash to a builder for the reasons given by others. If they quibble why you are then paying by cheque, offer to pay them the extra 50p it may cost to cash a business cheque. The price should be the same, as OF COURSE they are paying all tax on the cash.

Thanks for answering, Caitlin. I was confused over the £10 thing because I thought you worked for a bank, but I see I misread.

As a Money Laundering Reporting Officer, it seems to me that someone at HSBC has misunderstood the guidelines. I would be really surprised if it was HSBC's official policy to demand an invoice for any cash withdrawal, not least as there are numerous legal reasons why an invoice would not be possible (e.g going to a casino, buying a car from a private seller) More to the point, guidelines refer mainly to identifying the source, not purpose, of funds. There is no obligation on a bank to assess whether you are going to pay a tradesman in cash; the obligation to prevent tax evasion may be present when a tradesman pays the money in, but for a single payment of £6000 this is highly unlikely unless it is part of a series of payments. My guess - the cashier had just misunderstood what they were meant to do.

Sensible post Braganza but I fear this topic will drag on and on.

I'm an MLRO too (not in retail) but this is correct. And this will increasingly be a part of our every day banking relationships. We have seen a dramatic increase in AML efforts over the last few years and this is only the beginning - we in UK financial services have also almost by accident been made responsible for implementing the tax avoidance legislation of other countries (eg FATCA which is a piece of US legislation but which many other countries are seeking to copy). This is quite new territory for all of us and we should all be aware that this will increase year on year.

ML is mainly but not only about the source. But as I have repeatedly said, this is about banks having to show that they have processes in place to ask questions at the right time. It's not about the transaction per se but about having the process in place to trigger a series of questions.

Coutts' recent AML fine was not necessarily about mistakes of content (ie that they were actually handling proceeds of crime) but that they had no evidence of having the right processes in place.

I agree with all the posters who think this does make life difficult - it really does. I struggle with all the paperwork myself - especially the utility bills as the utility companies all want to move to online statements which are not, as yet, accepted, as KYC documents. But this just is the way things are going.

Braganza,

Thanks for confirming the point that I have been trying to make throughout this thread. It seems there are plenty of bankers/compliance officers who are the equivalent of head teachers who ban conkers based on 'health and safety' law.

It is for the government to put in place broad guidelines and for compliance departments to interpret them sensibly and proportionately. Those who use them to try to destroy privacy or to attempt to co-opt us all as tax inspectors deserve to lose our custom. And to the poster who said 'HSBC does not care about 60k'. In itself that is true. But if they start losing 1000s of this type of account, it will start to hurt both financially and, more importantly, reputation ally.

Why would they lose 1000s of customers though if all the banks have the same policy regarding cash withdrawals for large sums? Most people don't withdraw 1000s in cash to pay for something. The majority of people won't care if banks know who they are paying.

Whatever,

I am unconvinced that all the banks have the same policy. I am even unconvinced that HSBC has a consistent policy across all branches and customers.

Many people do like to use cash. Sure, it is a minority, but not an insignificant minority and, in general, probably they constitute richer rather than poorer customers.

Plenty of people still feel that they want both control and privacy regarding their own money. Some people may never feel the need to draw a large sum of money in cash but certainly feel that they ought to be able to should they wish to do so.

if all the banks have the same policy regarding cash withdrawals for large sums

Because a bank's policy doesn't necessarily mean the applicable regulations but can often be an interpretation of those regulations. And if you have a bank which, perhaps because it corrupted itself, is being over-zealous in stamping out often imaginary money laundering, customers will walk away.