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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

#531

Post by JCharante »

TheCapeGreek wrote: post #500
JCharante wrote: post #342

Earlier quoted context omitted.

Really? Wise has been reliable for a long time and they've improved the partners they work with in the last year to get much faster transfer times. I've sent around 15-20k usd with wise

Sending money through them still seems to be OK, mostly. But holding funds -and similarly to the Chase stories in this post- seems to be risky business, if you don't fit a cookie cutter model of a business (for whatever Wise's definition of that is). Ironically if you're using Wise, you probably aren't a cookie cutter business in the first place, so I don't know what's going on with them. Anecdotally it definitely al…

I exclusively use Wise for dealing with the third world. I never keep a balance there, just instant transfers, as I don’t trust any pseudo banks like paypal to not freeze accounts for no reason.

Thank you for the thread link

Re: Why banks are suddenly closing down customer accounts

#532

Post by Madmallard »

WalterBright wrote: post #355
Madmallard wrote: post #321

Earlier quoted context omitted.

This is completely false

No worries, you'll be mugged by reality sooner or later, I'm sorry to say.

No one I know on disability is gaming the system or doing well. It is not enough money. No one I know wants to be on it either, they just would die otherwise. Some kind of ultra ignorant rock you’re under.

Re: Why banks are suddenly closing down customer accounts

#533

Post by creer »

tyrfing wrote: post #251
raincom wrote: post #130

Earlier quoted context omitted.

Regulators fined Chase and other big banks for "weak controls". One way to show that these big banks have "strong controls" is to change parameters for these algorithms. Many legitimate transactions fall under structuring, layering, smurfing, laundering. After all, any goal of money laundering is to make their transactions appear "legitimate". Now almost all transactions (except for big businesses and people with few…

One way to prove weak controls is also to show that low-level branch employees have the ability to override AML/KYC flags, and regularly do so. That's not just poor controls, it's demonstrating knowledge of the transactions being suspicious while enabling them anyway. GP says "monitoring transactions should not be sufficient to satisfy KYC" - of course monitoring transactions is required to satisfy AML, flagging any…

Isn't this where documentation of actual KYC would come in? "Flagged for reason X; Overridden by local manager - follows 10 lines of CYA justification"? Normally that's good enough for administrations.

The second time it's flagged for reason X+1, include 10 lines from rank 2 manager.

Re: Why banks are suddenly closing down customer accounts

#534

Post by Ekaros »

Natsu wrote: post #488
XorNot wrote: post #99

Earlier quoted context omitted.

There's a very obvious utility in the US which should be able to prevent this: The US Postal Service. It's federally required to exist, and services all Americans already. Basic banking services should be one of the things it is expanded to provide in a minimal, safe fashion (i.e. no loans or lending, but guaranteed electronic banking and funds transfer services).

They should probably give people an email account that they can scan all your correspondence to for people who are without an address.

Funny thing is Finnish Posti (ex. Itella) kinda does it. They have online service where you sometimes get your mail "scanned" before it actually arrives. Probably due to them actually printing it (in better quality somehow?) and delivering to you.

Re: Why banks are suddenly closing down customer accounts

#535

Post by YawningAngel »

creer wrote: post #533
tyrfing wrote: post #251

Earlier quoted context omitted.

One way to prove weak controls is also to show that low-level branch employees have the ability to override AML/KYC flags, and regularly do so. That's not just poor controls, it's demonstrating knowledge of the transactions being suspicious while enabling them anyway. GP says "monitoring transactions should not be sufficient to satisfy KYC" - of course monitoring transactions is required to satisfy AML, flagging any…

Isn't this where documentation of actual KYC would come in? "Flagged for reason X; Overridden by local manager - follows 10 lines of CYA justification"? Normally that's good enough for administrations. The second time it's flagged for reason X+1, include 10 lines from rank 2 manager.

That probably would be acceptable but it's not clear it is worth the bank's while to do that

Re: Why banks are suddenly closing down customer accounts

#536

Post by pas »

Ridj48dhsnsh wrote: post #483
jopsen wrote: post #382

Earlier quoted context omitted.

These things simply don't compare. Any such attempt smells like trolling to me. System that are shitty by accident, do not compare to intentional evil.

Is it by accident though? Aren't US regulators intentionally (but quietly) pressuring financial institutions to do the enforcement of policies that they know wouldn't stand up to public scrutiny?

look, US politics is a shitshow, regulators are beholden to politics, lobbying is a very big influence in the US. from the crazy anti-porn, anti-abortion, anti-gay/trans, anti-welfare xenophobic fundamentalist anti-anything lobby to the anti-gun, super-duper-pro-trans, militantly-feminist, pro-eat-the-rich lobby.

and during all this banking in the US suffers from all the usual problems, it's 50+ regulatory regimes all in one, banking systems are laughably ambivalent old and legacy plus too new and full of bugs, and so on.

it's not surprising that things are not ideal. there's no need for some extreme conspiracy. big banks are user-hostile. just as the police, as healthcare, and so on.

Re: Why banks are suddenly closing down customer accounts

#537

Post by klauserc »

fyzix wrote: post #48
raincom wrote: post #41

Banks hide behind Bank Secrecy Act and other regulations in order to debank people. Chase closed my account, and the reason Chase gave: "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." I didn't dispute any t…

I'm usually a crypto sceptic but your story scares me, because it'll only get worse with time.

Why reach for crypto? My strategy would be to have a small emergency fund with a different bank. The risk of being debanked by two independent banks _at the same time_ seems lower than crypto.

Re: Why banks are suddenly closing down customer accounts

#538

Post by Gareth321 »

Ajay-p wrote: post #58

Debanking is deeply unfair but more so in our society that is moving increasingly towards a cash-less society. A person can be debanked for no fault of their own and that causes them to be unable to pay rent, bills, etc. Like being arrested - there is little recourse without great expense or effort.

This was and remains an important USP for cryptocurrencies. Security in one's ability to pay for goods and services is incredibly important for any currency. In Canada, the government effectively de-banked hundreds of people and froze their funds for participating in and donating to the trucker protest. As more and more people experience this loss of liberty, the need for free and secure transaction methods will grow. Governments and companies are becoming more oppressive, not less. For this reason, I see cryptocurrencies as inevitable. Eventually cash will be eliminated, and this will only leave cryptocurrencies.

For the record, I am far from a "crypto bro." I understand all of their limitations, including high volatility. I am arguing that their value is quickly growing in relation to their risks.

Re: Why banks are suddenly closing down customer accounts

#539

Post by irusensei »

Even if you are one of those people who thinks surveillance is okay to prevent crimes, wouldn't it make sense instead to tip the authorities and silently watch the transaction patterns until an actual crime is proven and its structures dismantled? Who thinks is the right thing to ban criminals to financial systems like cryptocurrencies where tracking is difficult?

Banks obviously! Crime and corruption departments are costly. If you are an actual millionaire they will make a 40 pages report on your political views before kicking you but if you are a small customer paying rent that happens to have a funny name or withdraw cash too frequently its better to just kick you out of the platform... and have you talk to the algorithm.

Think of it. If government wants to efficiently catch financial crimes they can instead setup a digital-nomad-crypto-friendly-bank-with-minimal-kyc-plus-eresidency-and-offshore-companies and just follow the money. I suspect this will be a lot more efficient than the current framework.

Banks are locking the capacity of an individual or group of people to interact with society and their access to basic living needs while making a mockery of the concept of innocent til prove guilty we built our societies on. The burden to prove you are not a criminal is on you.

And while vast majority of people are vocal against xenophobia and racism when its the banks ruining someone life because they have the wrong passport color some people will applaud and justify the systems protecting their sweet homeland from dirty barbarians from the east and south.

But even if you think AML laws are a force for good you need to agree this whole situation is very fucked up. I'm normally very against regulation but bank accounts in current digital society should be granted as a basic right.

Re: Why banks are suddenly closing down customer accounts

#540

Post by EVa5I7bHFq9mnYK »

kylehotchkiss wrote: post #78

Protip to anybody who wants to spend an extended amount of time overseas - you’re looking at a strong opportunity to join the list of people who have their accounts closed. Red flags include quantity of overseas debit card transactions, setting a PO Box (this one apparently is a very big red flag to banks) or a PMB as your bank address, lots of wire transfers. Open multiple bank accounts at different banks, use servi…

I have been residing overseas for the last 6 years, living in and visiting 27 countries in total. I also have 5 bank accounts and 9 cards, all registered to a virtual mail address and a VoiP phone number. No problems so far.

Protip: chill.

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