The illogical proof of address system: is it really required by law?

robatwork

Chapuys wrote: »

as they can all be verified electronically as I am on the electoral roll and have a passport/driving licence number linked to that address.

Driving licence yes, but your passport isn't linked to your address.

System would be much simpler if we all had one ID number that stayed with us our whole lives that was linked to everything, including an ID card.

Sadly the government screwed that up completely.

SouthLondonUser

Yes, @tacpot12, I understand that. But that is not the question. I suppose I just cannot explain myself.
I fully appreciate that anti-money laundering and Know-Your-Customer regulations require banks to verify customers. I get that. There is no need to repeat it yet once more.

However, is there any specific legal or regulatory requirement that this must be done by demanding the infamous and Bizantine proofs of address? THIS is the question.

I suspect not, because otherwise Monzo would be in blatant violation of these regulations, right?


I would also argue that it is harder to cheat a system like Monzo’s. I can think of many situations where someone could have easy access to someone else’s post: flatmates, neighbours in a block with no dedicated mailboxes (which is most house converted into flats), someone who has just moved and keeps receiving the post of the previous occupier, etc.

@Robatwork, I fully agree with you. The system of most continental European countries, where you have an ID card and a population register (which also does away with the need to separately register on the electoral roll) makes incredibly more sense.

It is really ludicrous that the country went up in arms when Labour tried to introduce ID cards over privacy concerns, yet noone seemed to bat an eyelif when it was discovered that the British spy agency GCHQ engaged in way more massive surveillance than what seems possible in continental Europe.
Also, credit reference agencies access and share way more data than in many countries with ID cards, but no one seems to mind.

Finally, something I quite never managed to understand is how someone can prove identity or nationality without a driving licence or a passport, neither of which are technically required – although de facto they practically are. The newspapers are full of stories of people who are technically British citizens by birth, except they aren’t because they cannot prove it, because they don’t have the paperwork to prove the residency status of their parents when they were born! Again, all of these problems go away with a national ID and population register system, but no, Britannia knows better…

SouthLondonUser

Chapuys wrote: »

Older banks may need more proof due to the legacy of 'always doing it that way' and your broker might just be covering all bases.

Exactly. He doesn't make the rules. He was adamant that each bank has its own set of silly rules, and by covering all bases now we make it easier to apply to a different lender should we ever need to (hopefully not).

batrachophagus

SouthLondonUser wrote: »

Yes, @tacpot12, I understand that. But that is not the question. I suppose I just cannot explain myself.
I fully appreciate that anti-money laundering and Know-Your-Customer regulations require banks to verify customers. I get that. There is no need to repeat it yet once more.

However, is there any specific legal or regulatory requirement that this must be done by demanding the infamous and Bizantine proofs of address? THIS is the question.

I suspect not, because otherwise Monzo would be in blatant violation of these regulations, right?


I would also argue that it is harder to cheat a system like Monzo’s. I can think of many situations where someone could have easy access to someone else’s post: flatmates, neighbours in a block with no dedicated mailboxes (which is most house converted into flats), someone who has just moved and keeps receiving the post of the previous occupier, etc.

@Robatwork, I fully agree with you. The system of most continental European countries, where you have an ID card and a population register (which also does away with the need to separately register on the electoral roll) makes incredibly more sense.

It is really ludicrous that the country went up in arms when Labour tried to introduce ID cards over privacy concerns, yet noone seemed to bat an eyelif when it was discovered that the British spy agency GCHQ engaged in way more massive surveillance than what seems possible in continental Europe.
Also, credit reference agencies access and share way more data than in many countries with ID cards, but no one seems to mind.

Finally, something I quite never managed to understand is how someone can prove identity or nationality without a driving licence or a passport, neither of which are technically required – although de facto they practically are. The newspapers are full of stories of people who are technically British citizens by birth, except they aren’t because they cannot prove it, because they don’t have the paperwork to prove the residency status of their parents when they were born! Again, all of these problems go away with a national ID and population register system, but no, Britannia knows better…

It is up to each financial institution to interpret the Know Your Customers and Anti-Money Laundering regulations. On top of their understanding of the minimum requirements, they will then layer additional requirements based upon their attitude to risk. Monzo are not offering credit, so their attitude to risk would be different to a mortgage provider.


https://www.finextra.com/newsarticle/30686/monzo-may-have-to-freeze-some-accounts-under-new-money-laundering-rules

batrachophagus

SouthLondonUser wrote: »

I would also argue that it is harder to cheat a system like Monzo’s. I can think of many situations where someone could have easy access to someone else’s post: flatmates, neighbours in a block with no dedicated mailboxes (which is most house converted into flats), someone who has just moved and keeps receiving the post of the previous occupier, etc.

If you admit to having a shared mailbox you will also find it very difficult to open an account with some financial institutions.

benjus

Is the proof of address requirement for the remortgage purely for legal reasons, or to satisfy the lender's own checks that you are who you claim to be?

In terms of risk to the bank/financial institution, opening a current account is a very different thing to borrowing typically hundreds of thousands of pounds to buy a property.

A current account application is likely to follow the legal minimum requirements, while a mortgage application is likely to be much more thorough. You're not really comparing like with like here.

Don80

SouthLondonUser wrote: »

This got me thinking: is this Bizantine system of requiring proof of address really a legal or regulatory requirement, or is it just a convention? If it were a legal requirement, I'd expect more consistency over what kind of documents are accepted and what are not.

Short answer - yes it is a legal requirement (I worked for a bank some years ago). Banks are bound by anti money laundering regulations which require them to check your identity. Generally this is proof of name (e.g. passport) and proof of address (recent bank statement/utility bill). This may be simpler if they find you on the electoral register (done as part of an ID/credit check). For a mortgage application you may need more (proof of earnings and expenditure etc).

tenchy

robatwork wrote: »

Driving licence yes, but your passport isn't linked to your address.

System would be much simpler if we all had one ID number that stayed with us our whole lives that was linked to everything, including an ID card.

Sadly the government screwed that up completely.

"Sadly the government screwed that up completely".


No. THANKFULLY the government screwed that up completely.


Do you really want to be under total state surveillance? It's bad enough as it is, without ID cards. Heaven knows how bad it would be with them.

System

The 3 easiest ones are:

Driving Licence - some will accept as sole ID along with electronic checks.
Energy Bill - these are usually quarterly anyway and often free.
Council Tax - normally accepted in current tax year.

Other things can be set for paper but I don't like providing bank or credit card statements for privacy reasons.

SouthLondonUser

benjus wrote: »

A current account application is likely to follow the legal minimum requirements, while a mortgage application is likely to be much more thorough. You're not really comparing like with like here.

Not exactly. I have personally experienced situations where a mortgage lender (Chelsea Building Society) was less anal than a utility company or a bank (for the opening of a current account) when it came to proofs of address.