Son's bank account frozen for 12 days, now back to normal. Is there any after effects?

JonMitchell

Good morning

Background

My son and his wife bank accounts were frozen around 12 days ago. His problem started when he tried to pay for a cup of coffee before he went to office but his credit card was rejected 3 times. He called the cc company and was told no issues with it, but later that day, he tried to make a BACS payment to their nanny and noted their joint bank account could not remit any money despite there are money in there.

Spent over 4hours with the bank and was told there was a "processing delay" and an 657 indicator in their bank account which was placed by the local branch. He was told to go into the branch with their ID, both of them went and spent 3hours but was told it was not the branch that done it. Both of them were asked if there were any suspicious activity that they noticed in their joing account of which there wasn't. 

After they returned, the only thing we could all think of was it might be a £12,000 lump sum monetary gift that I gave them in cash over 5 months ago? I had gone to my bank on a daily basis to withdraw £800 each day of my personal savings (am retired savings over the years in case anyone here ask) to give it to my son who are planning to purchase a property. I have kept the atm receipts.

I gave my son and his wife the receipts to show to the bank. The staff said they would sent the receipts to the "relevant department".
 
After 12 days, their accounts started to work again for some strange reason, the bank said there might be an internal error.

Aftermath   

The more we thought about it, it did look probably the lump sum of cash monetary gift that I given to my son?

I read on this forum that people do have their bank accounts frozen where banks send suspicious activities report to the National Crime Agency....

I am concern that this episode of gifting a lump sum of monetary gift to my son and his wife might cause them any problem in the future, will it? Not sure if the bank did raise any suspicious activities report to NCA and what happens next now that the account is back to normal. Will such reports remain on their credit file, like a "bad credit" which means they might have problem with re-mortgaging in future?

Thanks for any thoughts.

Concerned parent 

Section62

A £12k cash deposit would be the kind of thing which could cause banking problems... but how were they able to pay the money into their account without the bank asking for more information about the source of funds at the time?

What is almost certain is the bank won't be specific about any concerns they had and/or the processes they followed.  If you feel fobbed-off by their answers then there's a reason for that - i.e. them not wanting to put themselves in a position where they are 'tipping off'.

When your son comes to purchasing their property the solicitor is going to want evidence of the source of funds.  A parent withdrawing £800 cash daily and handing it over is towards the more unusual end of the spectrum of 'normal' activity, so your son should expect some further raised eyebrows when that is explained.

Sea_Shell

Is there any particular reason that you did this via cash withdrawals, rather than direct bank transfer?

£12,000 in £800 chunks is a bit unusual, especially if he was then banking the £800 cash each time.

Hopefully he won't suffer any further consequences, if his account has been unblocked now.

JonMitchell

Section62 said:

A £12k cash deposit would be the kind of thing which could cause banking problems... but how were they able to pay the money into their account without the bank asking for more information about the source of funds at the time?

What is almost certain is the bank won't be specific about any concerns they had and/or the processes they followed.  If you feel fobbed-off by their answers then there's a reason for that - i.e. them not wanting to put themselves in a position where they are 'tipping off'.

When your son comes to purchasing their property the solicitor is going to want evidence of the source of funds.  A parent withdrawing £800 cash daily and handing it over is towards the more unusual end of the spectrum of 'normal' activity, so your son should expect some further raised eyebrows when that is explained.

My son and wife just deposited the cash in their local branch machine. I get your point about raising eyebrows though.

Their solicitor was informed that I was gifting money in cash to them and was satisfied with the explanation given, because I don't do online banking, although I think I might have to learn to eventually. For your information, they exchanged contract yesterday.

During that 12 days when my son and daughter-in-law's joint account were frozen, they tried to open another bank account as they have only 1 joint bank account between themselves. But that highstreet bank rejected their application. This led us to think the bank might have submitted a suspicious activities report....

I am not angry with the bank's action but rather concerned if there will be any implication for my son and daughter-in-law in the future. Hopefully not??


 

JonMitchell

Sea_Shell said:

Is there any particular reason that you did this via cash withdrawals, rather than direct bank transfer?

£12,000 in £800 chunks is a bit unusual, especially if he was then banking the £800 cash each time.

Hopefully he won't suffer any further consequences, if his account has been unblocked now.

Section62 said:

A £12k cash deposit would be the kind of thing which could cause banking problems... but how were they able to pay the money into their account without the bank asking for more information about the source of funds at the time?

What is almost certain is the bank won't be specific about any concerns they had and/or the processes they followed.  If you feel fobbed-off by their answers then there's a reason for that - i.e. them not wanting to put themselves in a position where they are 'tipping off'.

When your son comes to purchasing their property the solicitor is going to want evidence of the source of funds.  A parent withdrawing £800 cash daily and handing it over is towards the more unusual end of the spectrum of 'normal' activity, so your son should expect some further raised eyebrows when that is explained.

To answer, unfortunately I don't use online banking. I tend to go to my branch for assistance when needed.

MovingForwards

Get a redacted copy of their bank statement or a photo of the sort code and account number. When in the bank ask them to transfer the £800 from your account to theirs, it will reduce future problems.

JonMitchell

Will this episode cause any problem for my son and daughter-in law in future, like "bad-note, moneylaundering" etc? Was wondering if anyone who had their bank account frozen and unfroze, share their experience please?

wmb194

JonMitchell said:

Sea_Shell said:

Is there any particular reason that you did this via cash withdrawals, rather than direct bank transfer?

£12,000 in £800 chunks is a bit unusual, especially if he was then banking the £800 cash each time.

Hopefully he won't suffer any further consequences, if his account has been unblocked now.

Section62 said:

A £12k cash deposit would be the kind of thing which could cause banking problems... but how were they able to pay the money into their account without the bank asking for more information about the source of funds at the time?

What is almost certain is the bank won't be specific about any concerns they had and/or the processes they followed.  If you feel fobbed-off by their answers then there's a reason for that - i.e. them not wanting to put themselves in a position where they are 'tipping off'.

When your son comes to purchasing their property the solicitor is going to want evidence of the source of funds.  A parent withdrawing £800 cash daily and handing it over is towards the more unusual end of the spectrum of 'normal' activity, so your son should expect some further raised eyebrows when that is explained.

To answer, unfortunately I don't use online banking. I tend to go to my branch for assistance when needed.

You could still write a cheque, get a counter cheque at the branch or have the branch organise an electronic payment for you.

JonMitchell

wmb194 said:

JonMitchell said:

Sea_Shell said:

Is there any particular reason that you did this via cash withdrawals, rather than direct bank transfer?

£12,000 in £800 chunks is a bit unusual, especially if he was then banking the £800 cash each time.

Hopefully he won't suffer any further consequences, if his account has been unblocked now.

Section62 said:

A £12k cash deposit would be the kind of thing which could cause banking problems... but how were they able to pay the money into their account without the bank asking for more information about the source of funds at the time?

What is almost certain is the bank won't be specific about any concerns they had and/or the processes they followed.  If you feel fobbed-off by their answers then there's a reason for that - i.e. them not wanting to put themselves in a position where they are 'tipping off'.

When your son comes to purchasing their property the solicitor is going to want evidence of the source of funds.  A parent withdrawing £800 cash daily and handing it over is towards the more unusual end of the spectrum of 'normal' activity, so your son should expect some further raised eyebrows when that is explained.

To answer, unfortunately I don't use online banking. I tend to go to my branch for assistance when needed.

You could still write a cheque, get a counter cheque at the branch or have the branch organise an electronic payment for you.

Yes I agree, something I will do in future.

Bridlington1

JonMitchell said:

Will this episode cause any problem for my son and daughter-in law in future, like "bad-note, moneylaundering" etc? Was wondering if anyone who had their bank account frozen and unfroze, share their experience please?

I doubt this will cause their accounts to get frozen again. The bank and NCA will have done their investigations into the matter when they froze the account in the first place and are clearly satisfied that they received the money legally, otherwise the account would still be frozen. As already mentioned however it may cause future issues with solicitors etc, though I doubt it will be too detrimental.

In answer to your second question. I have had 2 current accounts frozen. HSBC in February for 23 days and Virgin Money in March for 5 days. Luckily these weren't my main accounts, otherwise it would have been a nightmare as well as a right pain. Unfortunately there's little you can do once the accounts are frozen. Once unfrozen I've received a letter to tell me that after a review of my accounts all restrictions have now been lifted. I've never had any issues since, though both of these accounts have since been switched to other banks for the switching incentives.

Accounts getting frozen is one of the main advantages of having multiple current accounts (14 in my case), the other being the various perks each one offers. It's always a wise option to have a back up account in case one account gets frozen. 

For the future if you do give your son and daughter in law any money don't use cash. Cash raises eyebrows as it is far harder to trace. Faster payments and cheques are better for large gifts like this as they are easy for banks to trace. Faster payments can be done in branch if you don't want to use online banking, or over the phone.

JonMitchell

Bridlington1 said:

JonMitchell said:

Will this episode cause any problem for my son and daughter-in law in future, like "bad-note, moneylaundering" etc? Was wondering if anyone who had their bank account frozen and unfroze, share their experience please?

I doubt this will cause their accounts to get frozen again. The bank and NCA will have done their investigations into the matter when they froze the account in the first place and are clearly satisfied that they received the money legally, otherwise the account would still be frozen. As already mentioned however it may cause future issues with solicitors etc, though I doubt it will be too detrimental.

In answer to your second question. I have had 2 current accounts frozen. HSBC in February for 23 days and Virgin Money in March for 5 days. Luckily these weren't my main accounts, otherwise it would have been a nightmare as well as a right pain. Unfortunately there's little you can do once the accounts are frozen. Once unfrozen I've received a letter to tell me that after a review of my accounts all restrictions have now been lifted. I've never had any issues since, though both of these accounts have since been switched to other banks for the switching incentives.

Accounts getting frozen is one of the main advantages of having multiple current accounts (14 in my case), the other being the various perks each one offers. It's always a wise option to have a back up account in case one account gets frozen. 

For the future if you do give your son and daughter in law any money don't use cash. Cash raises eyebrows as it is far harder to trace. Faster payments and cheques are better for large gifts like this as they are easy for banks to trace. Faster payments can be done in branch if you don't want to use online banking, or over the phone.

Thanks for sharing your experience Bridlington, thats good to know! 

Guess I will have to finally need to learn and to adapt to technology. An old dinosaur I am then.