Author Topic: HSBC imposes restrictions on large cash withdrawals (UK News)  (Read 585 times)

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Offline Gazoo

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HSBC imposes restrictions on large cash withdrawals (UK News)
« on: January 25, 2014, 03:52:56 PM »
Quote

24 January 2014 Last updated at 14:59 ET

By Bob Howard
Reporter, Money Box
 
HSBC bank sign HSBC customers requiring large cash withdrawals may be asked what they want the money for Some HSBC customers have been prevented from withdrawing large amounts of cash because they could not provide evidence of why they wanted it, the BBC has learnt.

Listeners have told Radio 4's Money Box they were stopped 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.

The bank says it has now changed its guidance to staff.

New rules
 
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A year before, he had withdrawn a larger sum in cash from HSBC without a problem.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, as he told 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.

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”

http://www.bbc.co.uk/news/business-25861717
« Last Edit: January 25, 2014, 03:55:46 PM by Gazoo »
"The Tea Party has a right to feel cheated.

When does the Republican Party, put in the majority by the Tea Party, plan to honor its commitment to halt the growth of the Federal monolith and bring the budget back into balance"?

Offline Gazoo

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Re: HSBC imposes restrictions on large cash withdrawals (UK News)
« Reply #1 on: January 25, 2014, 03:59:56 PM »
There is only one reason to do this.  Is this story accurate?

"The Tea Party has a right to feel cheated.

When does the Republican Party, put in the majority by the Tea Party, plan to honor its commitment to halt the growth of the Federal monolith and bring the budget back into balance"?

Offline EC

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Re: HSBC imposes restrictions on large cash withdrawals (UK News)
« Reply #2 on: January 25, 2014, 06:37:30 PM »
There is only one reason to do this.  Is this story accurate?

Most banks here have a daily limit for personal savings accounts. It varies from £500 to £3000 on demand in cash.
If you want more, you have to clear it with the bank approx one week ahead. It's not hugely sinister - banks try not to carry too much cash at any one time, to reduce the risk of robbery. It also prevents anyone draining your account if they find your passbook in the street.

He should have asked for a counter cheque made payable to his mother - there are no limits on those, other than the limit of your assets.

Just to clarify - the previous withdrawl. If he walked in at close of business and asked for £10,000 (for example) - if the bank has it and he can prove who he is, they'd most likely let him have it. Once it is logged out of the bank, they are no longer on the hook for it if the safe comes up short or gets removed.
« Last Edit: January 25, 2014, 06:42:36 PM by EC »
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Offline Oceander

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Re: HSBC imposes restrictions on large cash withdrawals (UK News)
« Reply #3 on: January 25, 2014, 06:54:49 PM »
who knows.  since it seems that hsbc are just now enforcing this long-standing rule, i smell a bank with a liquidity problem

Offline EC

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Re: HSBC imposes restrictions on large cash withdrawals (UK News)
« Reply #4 on: January 25, 2014, 06:58:29 PM »
who knows.  since it seems that hsbc are just now enforcing this long-standing rule, i smell a bank with a liquidity problem

There are rumors that they are having a wee liquidity problem. Note: rumors.

Doesn't affect me - I dropped them about 10 years ago. Still have an account there, but there is about £20 in it. Not foresight or some super genius finance thing - I got ticked off at a cashier.
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Offline Oceander

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Re: HSBC imposes restrictions on large cash withdrawals (UK News)
« Reply #5 on: January 25, 2014, 07:01:22 PM »
There are rumors that they are having a wee liquidity problem. Note: rumors.

Doesn't affect me - I dropped them about 10 years ago. Still have an account there, but there is about £20 in it. Not foresight or some super genius finance thing - I got ticked off at a cashier.

I know some others - UK expats - who've dropped them as well.  There's also the issue of the rather large fines they're paying off right now, so I would think there's some truth to those rumors; if so, they're smart to use the existing policies as a fig leaf to start stemming the cash spigot now, because if they do have problems and that becomes public, then we'll get to see a really neat run on a large international bank.

Offline EC

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Re: HSBC imposes restrictions on large cash withdrawals (UK News)
« Reply #6 on: January 25, 2014, 07:08:03 PM »
I'm thinking they got over-strained in the Far East. They are the biggest UK bank in China, Hong Kong and Japan, none of who's economies are exactly stellar right now.
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Offline Gazoo

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Re: HSBC imposes restrictions on large cash withdrawals (UK News)
« Reply #7 on: January 26, 2014, 10:09:02 AM »
Okay, maybe I have not had enough coffee or something but bringing in a note for proof of what the money is needed for means they are trying to curb a run on the bank? The one example in the article gave the proper notice and they said over the phone all was well. Then they did not give them the money. Yet no where in the article does it show where a customer asked for a cashiers check? This scenerio is not good as they are lacking in the funds; and or, are trying to stop bank runs?

Morale of the story...can any of us live without the almighty debit card? So spoiled... paying bills/shopping online and all.
« Last Edit: January 26, 2014, 10:37:50 AM by Gazoo »
"The Tea Party has a right to feel cheated.

When does the Republican Party, put in the majority by the Tea Party, plan to honor its commitment to halt the growth of the Federal monolith and bring the budget back into balance"?

Offline EC

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Re: HSBC imposes restrictions on large cash withdrawals (UK News)
« Reply #8 on: January 26, 2014, 10:33:26 AM »
Okay, maybe I have not had enough coffee or something but bringing in a note for proof of what the money is needed for means they are trying to curb a run on the bank? The one example in the article gave the proper notice and they said over the phone all was well. Then they did not give them the money. Yet no where in the article does it show where a customer asked for a cashiers check? This scenerio is not good as they are lacking in the funds; and or, are trying to stop bank runs?

Morale of the story...can any of us live without the almighty debit card? So spoiled... paying bills/hopping online and all.

Never had one. I pay cash for everything. I only accept cash.

It's actually becoming a thing here. Makes the tax accounting more difficult - but it is still legal. And yes, I pay my tax in cash.
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Offline Chieftain

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Re: HSBC imposes restrictions on large cash withdrawals (UK News)
« Reply #9 on: January 26, 2014, 10:44:47 AM »
Most banks here have a daily limit for personal savings accounts. It varies from £500 to £3000 on demand in cash.
If you want more, you have to clear it with the bank approx one week ahead. It's not hugely sinister - banks try not to carry too much cash at any one time, to reduce the risk of robbery. It also prevents anyone draining your account if they find your passbook in the street.

He should have asked for a counter cheque made payable to his mother - there are no limits on those, other than the limit of your assets.

Just to clarify - the previous withdrawl. If he walked in at close of business and asked for £10,000 (for example) - if the bank has it and he can prove who he is, they'd most likely let him have it. Once it is logged out of the bank, they are no longer on the hook for it if the safe comes up short or gets removed.

That does make sense, and it is significant that this is taking place in the UK, not the US, and out banking laws are different.

I must point out though, that any cash transaction in excess of $5000, in or out, is reported by banking officials here in the US, primarily as a means of combating the illegal drug trade.  This is also a major reason why new marijuana related businesses in Colorado and Washington are unable to get business checking accounts.  A week or so ago I read an article about one grower in Colorado who packed $53,000 in twenty dollar bills into the local tax collector to make a payment, because he cannot get a checking account for his marijuana dispensary business.

« Last Edit: January 26, 2014, 10:45:16 AM by Chieftain »

Offline EC

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Re: HSBC imposes restrictions on large cash withdrawals (UK News)
« Reply #10 on: January 26, 2014, 11:12:50 AM »
I think our reporting level is £10,000. Hey - drugs cost more here. You got shipping fees and our customs are pretty good.  :laugh:

I have absolutely no problems with banks reporting large cash transactions. It is, at most, an inconvenience when Excise stops by to ask you questions. Make sure you answer the door though, they can do warrantless entry and search.
They don't always though - you pop 10 large out of your account in cash and register a new (to you) car a day later, they'll usually give you a pass on it, as long as the book value is in the ballpark of what you withdraw.
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Offline Oceander

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Re: HSBC imposes restrictions on large cash withdrawals (UK News)
« Reply #11 on: January 26, 2014, 10:21:56 PM »
That does make sense, and it is significant that this is taking place in the UK, not the US, and out banking laws are different.

I must point out though, that any cash transaction in excess of $5000, in or out, is reported by banking officials here in the US, primarily as a means of combating the illegal drug trade.  This is also a major reason why new marijuana related businesses in Colorado and Washington are unable to get business checking accounts.  A week or so ago I read an article about one grower in Colorado who packed $53,000 in twenty dollar bills into the local tax collector to make a payment, because he cannot get a checking account for his marijuana dispensary business.



The $5k threshhold generally only applies to cash transactions - as opposed to, e.g., checks - where there is some other indicia of illegality that the bank is, or reasonably ought to be, aware of.  Cash transactions that don't involve some other indicia of illegality only have to be reported if the sum involved - either in one go or in a series of related goes - is $10k or more.

That being said, I would suspect that most US banks will file an SAR on any cash transaction over $5k, regardless of whether there really are any other indicia of illegality, unless they happen to know the person and his/her business well.


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