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Why banks are suddenly closing down customer accounts

nytimes.com

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Re: Why banks are suddenly closing down customer accounts

#791

Post by RoyalHenOil »

averageRoyalty wrote: post #750
ArabicBaklava wrote: post #481

Bank of america did this to me, in the same weekend i was moving out. All my stuff was in the car, it was a friday at 3PM and i was in the gas station. I couldn't fill up my gas. Called and they told me to come to the bank with two forms of ID. When I arrived to the bank the fraud department was operating in NY (3hrs ahead) and they were closing, so they told me to come next tuesday (it was a long weekend). I went ho…

Almost exactly the same story, different country. Long weekend, Friday I'm working on site and go to grab a drink at the shop and my card declines. I go to log into internet banking and I can't. I call them, and the tone goes from friendly to frosty out of nowhere. Took us a full week to get a cheque (!!) that we could take to another bank to move all of our money there. Thankfully, I had just sold something online f…

Thank you for naming the bank. I will make absolutely sure to avoid them and to warn others about them. Having something like that happen can be ruinous.

Re: Why banks are suddenly closing down customer accounts

#792

Post by etothepii »

caeril wrote: post #718
ArabicBaklava wrote: post #481

Bank of america did this to me, in the same weekend i was moving out. All my stuff was in the car, it was a friday at 3PM and i was in the gas station. I couldn't fill up my gas. Called and they told me to come to the bank with two forms of ID. When I arrived to the bank the fraud department was operating in NY (3hrs ahead) and they were closing, so they told me to come next tuesday (it was a long weekend). I went ho…

Contrasting the replies to this comment with the replies in all the "cashless society" posts are hilarious. "Oh I never use cash, cashless transactions take 0.00362 seconds less, so taking the risk that I become homeless is worth it to me." - followed by outrage at discovering that trusting your entire financial life to the whims of a compliance department is a real risk. At some point, you have to assess your risks…

I suspect the reason most people don't have a few stacks somewhere is that the vast majority of people have no savings. 45% according to one survey I saw don't have $1,000 in savings.

Re: Why banks are suddenly closing down customer accounts

#793

Post by gardenhedge »

OkayPhysicist wrote: post #785
gardenhedge wrote: post #781

Earlier quoted context omitted.

How does the existence of rug pulls (aka scams) invalidate the option of moving to crypto?

It's not the existence of crime, crime happens in real money, too. It's the complete and utter lack of anything else but crime. Originally, Bitcoin only appealed to 1) geeks who enjoyed the technical details and 2) people who wanted to buy drugs. Then, you got to phase 2, where bolstered by the liquidity provided by the people trading drugs and the unbridled enthusiasm of the geeks, the value went up. Then, The Silk…

In phase 1, how is geeks enjoying the technical details illegal? You said "It's the complete and utter lack of anything else but crime".

Regardless of that, you've stated that crypto can be used to buy things. The parent post said "Let's transition to cashless society". Why can crypto not be used?

Re: Why banks are suddenly closing down customer accounts

#794

Post by cheema33 »

ArabicBaklava wrote: post #481

Bank of america did this to me, in the same weekend i was moving out. All my stuff was in the car, it was a friday at 3PM and i was in the gas station. I couldn't fill up my gas. Called and they told me to come to the bank with two forms of ID. When I arrived to the bank the fraud department was operating in NY (3hrs ahead) and they were closing, so they told me to come next tuesday (it was a long weekend). I went ho…

Banks have algorithms that can detect when a customer is going through a serious financial difficulty and may become a liability.

I know because it happened to me.

The fact that you became homeless, no food for one week, couldn't graduate because you couldn't pay tuition etc. all point to the same thing. BTW, colleges don't screw you over if you are late paying tuition for just one week. I know that quite well too.

When my bank closed my accounts, I was super annoyed. But I knew why they did it.

Re: Why banks are suddenly closing down customer accounts

#795

Post by cheema33 »

manojlds wrote: post #730
pc86 wrote: post #680

Earlier quoted context omitted.

I don't have any context into OP's story that isn't in this thread, but there's no legal requirement for a bank to immediately give you access to your funds if your account is closed, especially if its closed for suspicious activity. My wife had a PNC account closed when she was in college and their official position was that they would mail a cashier's check to the address on the account within 90 days. I'd be shock…

They said they got access in 1 week. That they got their roll in univ revoked in 1 week that happened to have a long weekend is dubious sounding either side - it all happened in 1 week feels tooshort on univ side or 1 week sounds too short on the bank side

> They said they got access in 1 week. That they got their roll in univ revoked in 1 week that happened to have a long weekend is dubious sounding either side

Yeah, I am not believing this story at all.

No University is going to disown you if you are late 1 week. The rest of the story is just as weak.

Re: Why banks are suddenly closing down customer accounts

#796

Post by raincom »

elzbardico wrote: post #779

Banks should close accounts for administrative reasons only, with ample notice period, and give full disclosure of the reason. Balance should be made available as soon as possible once the customer present an alternative account, or he should be able to get a check. For regulatory reasons, only the government should be able to mandate closure and for that it should be backed by a judicial order. I don't fucking care…

Two things:

(a) Banks can be vague in their SAR filings with “transaction with no apparent economic, business or lawful purpose”

(b) What BSA manul says: "No bank, and no director, officer, employee, or agent of a bank that reports a suspicious transaction may notify any person involved in the transaction that the transaction has been reported." [1]

This deadly combination is enough for banks to NOT disclose. That's why a vague reason is provided by banks; here is Chase's template: "Financial institutions have an obligation to know our customers and monitor transactions that flow through our customers' accounts. After careful consideration, we decided to close your account because of unexpected activity on these or another Chase account."

[1] https://bsaaml.ffiec.gov/manual/AssessingComplianceWithBSARe...

Re: Why banks are suddenly closing down customer accounts

#797

Post by raincom »

patwolf wrote: post #669

I do wonder if the problem lies with the banks or with the amount of federal regulation that makes certain customers unattractive. I had a small business bank account, and one day I got a call from the bank asking to go through my transaction list and provide explanations for all the transactions. Fortunately they didn't close the account, but given the fact that it was costing them to investigate my account, it did…

It is combination of both factors, along with others. (a) big banks (b) BSA compliance manuals (AML, KYC) (c) regulators slapping huge fines against big banks for "weak controls" (d) an algorithmic solution to show that banks have "strong controls"

(b), (c), (d) force banks to wage war against cash. So, if you have a small business that accepts cash, your bank doesn't want your business as a customer, as they don't want to accept cash deposits, nor do they want customers who withdraw cash regularly. That's why large retailers have their own shadow banks to get around the push towards anti-cash.

Re: Why banks are suddenly closing down customer accounts

#798

Post by freddie_mercury »

avs733 wrote: post #367
freddie_mercury wrote: post #242

Earlier quoted context omitted.

> I'm somewhat surprised no one here views this as an automated decisionmaking problem It isn't an automated decision-making problem. Every instance involves humans in the loop making the final decision. And that article makes clear -- via spokesperson statements -- that it is auditable and the banks know exactly why accounts were terminated.

I know what you are saying but I want to counter the interpretation a bit. What the spokespeople say is a claim…it’s not truth, we don’t have independent evidence of it, of course they would claim that. Even if they did have human in the loop - what does that meaningfully look like? Are those humans given the authority to actually overrule the decision? Are they given the evidence to do so? Are they punished or perce…

> I don’t think taking the banks answer to any of those questions at face value is responsible citizenship

I agree but I wanted to push back on the idea that this was somehow due to automated decisions being made. That isn't really the problem here. The same exact thing would happen if the government mandated "no computers are allowed to be involved". The problem is opaque decision making, no clear escalation path, a disregard for the short term pains, and so on.

The fundamental problem isn't how the decision gets made. Even if a human made the decision you'd have the same issues of the front line consumer support saying "well the other department made their decision, I don't know why and I don't have the authority to change it and they don't accept calls".

By talking about automated decisions, the OP is making the conversation about the wrong problem.

Re: Why banks are suddenly closing down customer accounts

#799

Post by musictubes »

reaperman wrote: post #191
musictubes wrote: post #180

Earlier quoted context omitted.

I moved from the US to Yemen from 2006-2008. After I got the travel details figured out I realized I would need some way of getting money while I was there. Freaked out for a bit, figured that with the war on terror ongoing it would prove to be incredibly difficult. Turns out my ATM card worked fine while I was over there. I did let the bank know I would be there and I kept my address in the US though. My card got lo…

I got put on a watch list during my time in Saudi and Abu Dhabi. Didnt affect my banking but every plane ticket i got for years had “SSSS”[0] printed/sharpied on it and all my luggage would get a secondary hand-search at every stop immediately pre-boarding both domestically and internationally. I am just average white US citizen who was working on oil rigs but most likely some of my whatsapp/facebook/iMessage contact…

Heh, yeah. I was "randomly" pulled aside for extra security screenings every flight. To be fair, I later learned that I was going to the same Arabic language school that John Walker Lindh did. I managed to avoid doing what he did though lol.

Re: Why banks are suddenly closing down customer accounts

#800

Post by eru »

landemva wrote: post #496
eru wrote: post #399

Earlier quoted context omitted.

> What's another institution that has offices everywhere, ships things every day, [...] Walmart or 7-11 or so? Jokes aside, giving banking licenses to retailers might be a sensible thing to do. (Or removing the whole system of banks requiring licenses altogether would be even better.)

Walmart does have banking. https://www.consumerreports.org/banks/is-banking-at-walmart-... "At its more than 4,600 in-store MoneyCenters, as well as online, millions of customers have access to basic, low-cost banking services, including the ability to withdraw cash, make deposits, and pay bills."

Thanks. The last I heard of it was that the banks were still lobbying against giving Walmart the license.
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