Money Laundering Regulations ... Gone too far?

bobwilson

hmm... we're applying for a mortgage, and Nationwide are asking us to prove where our savings came from.

What happens if a savings account had a lump sum transferred into it upon opening, is many many years old, and hadn't been touched since? Banks don't provide statements that far back.

What if you saved your whole life, and one account is from a lump sum saved 20 years ago, but you don't have proof going back 20 years. Are you never allowed to use that money to buy a house?

What if you saved in gold or cash, in a safe under your bed?! It's everyones' right. Especially with the way banks are behaving lately.

I understand there are money laundering regulations but there comes a time when it goes too far, and that time is when innocent people can lose out because of short sighted systems.

I'm truly astounded that Nationwide can legally ask for proof of where savings came from, but not only that, that it is ''required'' of them by law. How far closer to big brother are we getting, and when are people / governments going to realise invasion of privacy is just as immoral as tax evasion in the first place?

Does there reach a point where the regulations have become so extreme that they prevent peoples' enjoyment of society as much as the tax evaders in the first place?

Isn't it a bit like killing the patient to cure them...

So, does anyone know what's the 'answer' in the 'system' for someone who saved a lump sum many years back, and the bank doesn't keep statements that long? How are they expected to 'prove' where their savings came from? Will they just be unmortgageable?

getmore4less

I thought the point of the regulation is there is a chain.

if it comes from a place that complies with the regulations that is good enough.

so all you have to do is prove the money came from an org that complies with the regs.

the second part of the regs is proving that you are who you say you are.

Ask them what consitutes proof

withabix

You just have to state where it comes from.

The answer is 'a savings account at xxxx bank'.

It isn't just (or even) for money laundering. In the case of a mortgage, it is to prevent GIFTED DEPOSITS from the person or company you are buying the property from.

This practice (gifted deposits) contributed to the overheated housing market and was also used in a number of mortgage scams.

ACG

Every lender does this.

Theyre not going to start being a detective and look through 20 years of statements, theyre asking a question and may ask for proof of that. If your a money launderer your not going to leave it in an account for 20 years are you?

They also need to know so that if any of it is a gift then they can send out the relevant paperwork.

I dont see the issue.

vectistim

They'd only be likely to ask more questions should the money have only just turned up in the account in the last couple of months.

If you had an account with £1 in it and then suddenly £50,000 turned up three weeks ago they'd want to know where that money came from. Such a situation would be flagging up gifted deposit issues.

Thrugelmir

bobwilson wrote: »

Banks don't provide statements that far back.

Advisable for you to keep personal paperwork though for around 6 years.