Bank Insisting I tell them why I am making a Payment to my Daughter

[Gaggley]

I usually do my banking online but thought it would be easier to set up a standing order by calling First Direct today. After going through security, I was asked a number of questions about whether I had been forced to do this, had I been told to download software, was anyone watching me online etc. This is irritating, as it is incredibly unlikely that anyone who was being scammed would say yes, but I answered them none the less.

I was then asked how I had been given the bank details. I said that I had made the transfer before, but still had to give specific details as to how my daughter had given me the bank details, that I had successfully made manual transfers to multiple times over many years. After we'd got past this, I was then told I had to tell them why I was paying money to my daughter. I declined to answer, and was prevented from setting up a standing order. Complaints department confirmed that this was their procedure and they were knowingly preventing me from moving my own money around.

I asked them how much fraud they could quantify had been prevented by these arbitratry measures, they could not answer. But if I had done this myself online, then I would not have to justify my own decisions, could just do it at the drop of a hat. Bloody annoying. But a real problem for people who can't manage to use online services, who are forced to give up their privacy by rules like this.

Does anyone have a bank that will allow you to make transactions over the phone without justifying how they spend their own money, as I would like to switch to them?

Also, I believe £3K is the annual limit you can give to dependents/family. Maybe that’s another issue, although generally banks don’t care too much about this. They’d be approached by HMRC in some cases re inheritance tax, although I don’t know if they get too involved, dunno, certainly no expert on this.

That's nonsense. It applies for some inheritance tax cases but there's no limit on who you can give your own money to.

Just say it’s a gift, they don’t want to know the minute details.

Like they can put a limit on that! 😆

If someone dies within seven years (I think, don't quote me) of giving money to people, it's possible that it might get taxed - but nobody can stop someone from giving everything they have to a family member, if they want to.

Annually, I meant. Not nonsense, but does only apply if the person giving the cash dies within 7 years. Didn’t realise I was doing an inheritance tax exam!

https://www.gov.uk/inheritance-tax/gifts#:~:text=Annual%20exemption,£3%2C000%20between%20several%20people.

I’m a FCP manager and it’s standard procedure for transactions over the phone now due to the high fraud risk.

It’s for you and your daughters protection. You can say something generic like monthly expenses or a gift but we have to have something for compliance regulations.

If you can use Mumsnet, you can use online banking.

It doesn't mean its not allowed though, it just means if you do there might be some future tax to pay.

It only applies if the deceased's estate is over the inheritance tax threshold.

Should have mentioned that too! I’m doing really poorly on this exam! Mum’s estate is over the limit of £325K. I keep telling her to spend it.

FD's people are in the UK.

In fact since Covid all the financial institutions I've dealt with have UK based staff when it comes to setting up transactions.

I bank with First Direct and whilst I can understand why you are frustrated and it seems absolutely ludicrous, they are one of the best banks for preventing fraud.

The voice recognition software is amazing and saves so much hassle with “security” checks.

When the tables were turned on me (someone having a fraudulent spending spree at my expense), the matter was resolved within 24 hours maximum. Equally when I stupidly left some cash at the cash machine. It was refunded to me immediately whilst under investigation. Never heard anything further.

I find the staff exceptionally helpful on the phone, often going above and beyond.

Just set the standing order up through the App. Face recognition is all the security they need to satisfy their criteria.

They won't.

I was cross questioned like this over a £12 standing order to the scouts.

Banks have to show they’re being careful these days. Think you were a bit defensive tbh. How you going to transfer the money now?

I bank with FD and had a similar experience recently, working in banking myself, I was very impressed with the service. I was called to verify an online transaction and was asked many questions on the process which actually made me double check my facts. I work in the Financial crime risk department of a foreign bank. so I know why they do it. I would rather that then get scammed. The have the same questions for everyone so if someone refuses to answer one question (which is actually to check its nothing illegal too) then they are within their rights to deny the transfer. All good progress I would say. How do they not know that you are not being blackmailed a family member to do the transfer? or being stood over to make the transfer under duress?

The UK are one of the first countries in the world where banks are taking the hit where people are getting scammed so if you are then they will pay up. they need to protect themselves too.

It's just standard procedure - much like having to press ok in the app or add in a passcode to a website to make a purchase.

I transferred £5k to infant DDs savings account and was on the phone for 20 minutes while they did the security checks. They did ask if they could speak to her as well to confirm the details. I declined on the grounds she was 1.

It's happened to me, in branch. There's a figure (£5k??) over which anti-fraud measures are required. So in branch, you need photo ID, and to answer questions to ensure you're not acting under duress.

I transfer quite a large sum just before the start of the academic year to university age DC. The staff can see I do this (pattern of transfers to various young people, all with the same address as me, all just before the start of term). They're utterly unconcerned about me personally and these transfers, but have to go through all the questions.

If you want to avoid them completely, the best way is to be old fashioned and write a cheque for your DC to pay in.

Why on earth are you cross with a Bank trying to prevent fraud or scams? Seems bizarre to me.

My DD banks with FD, and she has been contacted by scammers twice in the last fortnight pretending to be FD staff.
You should be grateful that they are on the ball with this.
I would answer any questions necessary to do my banking business.

A few years ago I had one of my credit card details stolen. They did 2 transactions of increasing amounts starting with £5 at a petrol station, then £12 to National Express and then a £35 Argos transaction. The Argos transaction was declined and I was alerted by text with my last few transactions.

It is common depending on how bank/credit card details are obtained for scammers to start with smaller amounts.

I don't have any suggestions for an alternative bank, but when we changed bank recently, my husband started to be asked for explanations of incoming and outgoing payments for similar reasons... again we felt like this was an invasion of privacy.

Surely you just tell them what it's for "to help her with childcare bills / to help her save for upcoming mat leave / to help pay for house improvements / to put into a shared savings pot for a joint holiday" etc.

A regular amount isn’t taxed if you say gifting from unneeded income.

Inheritance limit is 650k from both parents, 1 million if main home.

There shouldn't be.

Something like 40% of all crime in the UK is financial.

So it banks and BS are doing their best to ensure that you and in turn they are subject to it.

You absolutely should be using online banking if you're frustrated with the banks telephone/branch processes (it can be long-winded). Never take the questions personally, they are genuinely required to ask you.

£1.2 - £4 billion was lost in the UK to fraud last year (I couldn't find an exact number but you get the picture), a number that is slowly dropping due to stricter banking requirements.
Regulations are there for a reason. Regulations are there to protect you.

Not really the main point…