How to avoid bank accounts being frozen and minimise problems if they were.

RG2015

MattMattMattUK said:

One of the biggest triggers for private individuals is transactions to or from another account associated with fraud or criminality. Someone the person has made a payment from or to ends up being part of a criminal investigation, or a payment was made fraudulently, eg. an account compromised and money transferred by criminals or fraudsters to obtain goods and/or services. Beyond that we do not really know as some of them are opaque, others are based on algorithms etc.  

Yes, and there was a revealing post a little while back confirming that innocent customers would have their accounts closed solely due to an association with a suspected fraudster.

See the link below for the post by TimSynths

https://forums.moneysavingexpert.com/discussion/6421482/banks-closing-accounts/p3

[Deleted User]

AstonSmith said:

[Deleted User] said:

I am not convinced by the majority of these threads, I think in the majority of cases the OP doesn't give all the details.

What sort of details? If they were guilty of a crime, surely they'd already know why it happened and not post about it on a forum?

I would add to the list in the first post:

• Have a small amount of cash handy, maybe 2-3 weeks worth for food/petrol
  

People using a current account for their business, doing cash in hand work to avoid tax etc.

nyermen

Comment regarding big businesses - as noted they will have their own relationship managers.  They’ll also have multiple accounts most likely (presuming they’re multi-nationals, “big” being the word used).

Big businesses also have their own treasurer/treasury team who will be in touch for cash management and other factors,.

Doesn’t stop problems though (from CEO impersonation frauds to staff fraud).

adamp87

In time of business fraud usually comes from staff and gets caught.

As someone who runs a business I think it’s much more difficult for someone to call us and try and scam money out of us in the sense we see happen to particularly elderly customers say - or send us a dodgy app to use.

Me and the accountant cross reference everything, we get VAT invoices for almost everything and items aren’t paid unless we can confirm.

In answer to the query of the main post while people can give advice and best practice it can happen to anyone as we aren’t really aware of what triggers reviews/alerts within the bank. If we did then it’d be much easier for people to commit fraud so somethings we can’t be privy too

Momanns

[Deleted User] said:

I am not convinced by the majority of these threads, I think in the majority of cases the OP doesn't give all the details.

Could not agree more.

Momanns

• Maintain a spare account or emergency credit card
• Keep all contact details up to date - In case a payment is held/blocked
• Avoid crypto exchanges/excessive use of MSB's for payments & transfers
• Avoid activity on a personal account which could be seen as business (Against T&C's & banks may suspect tax evasion)
• Avoid "out of character" payments such as sudden cash deposits, rapid transfers & other AML red flags
• Be prepared to switch or change bank if required 

lr1277

Good thread @RG2015. Thank you for starting it.

I am confused by the advice to have more than 1 account.

I understand your primary bank may be having technical difficulties so it is wise to have a backup.

But if fraud is committed by the account holder or somebody they have a financial connection with, doesn't that mean all the banks are alerted and all your accounts are frozen? Assuming freezing the account was the correct course of action, does it take time to confirm the fraud, so by having an alternative account, you still have access to funds? Or are other banks not told about the freezing of the account till the 1st bank confirms the fraud?

So I suppose I am concerned how quickly other banks will freeze your accounts once the initial fraud allegation is made? Under what circumstances will other banks freeze your account if your primary bank has done so?

km1500

Point 1 should be slightly amended to say your accounts should be at different institutions
 For example, not at Lloyds and Halifax. Not at HSBC and FD. etc

RG2015

adamp87 said:

In time of business fraud usually comes from staff and gets caught.

As someone who runs a business I think it’s much more difficult for someone to call us and try and scam money out of us in the sense we see happen to particularly elderly customers say - or send us a dodgy app to use.

Me and the accountant cross reference everything, we get VAT invoices for almost everything and items aren’t paid unless we can confirm.

In answer to the query of the main post while people can give advice and best practice it can happen to anyone as we aren’t really aware of what triggers reviews/alerts within the bank. If we did then it’d be much easier for people to commit fraud so somethings we can’t be privy too

This is the whole point of the post. Several reasons have already been identified. These may or may not be valid but if they could be avoided without too much trouble it must be worth doing.

Momanns

lr1277 said:

Good thread @RG2015. Thank you for starting it.

I am confused by the advice to have more than 1 account.

I understand your primary bank may be having technical difficulties so it is wise to have a backup.

But if fraud is committed by the account holder or somebody they have a financial connection with, doesn't that mean all the banks are alerted and all your accounts are frozen? Assuming freezing the account was the correct course of action, does it take time to confirm the fraud, so by having an alternative account, you still have access to funds? Or are other banks not told about the freezing of the account till the 1st bank confirms the fraud?

So I suppose I am concerned how quickly other banks will freeze your accounts once the initial fraud allegation is made? Under what circumstances will other banks freeze your account if your primary bank has done so?

No such system or process exists. Should an individual or business get a CIFAS marker, this may trigger other banks to exit the relationship. If a confirmed fraud send's/receives money from another account there is an indemnity process to return funds which would notify the other bank who will then likely close those accounts.

So I suppose I am concerned how quickly other banks will freeze your accounts once the initial fraud allegation is made? - They won't
Under what circumstances will other banks freeze your account if your primary bank has done so? - In certain circumstances of confirmed fraud where the bank will notify/return funds or request a return of funds from the other account.

I think the point on some of the other threads is that an account can get blocked pending a fraud or AML Investigation and 9/10 nothing further happens. The bank only need to suspect money laundering/fraud and this can be triggered but seemingly innocent actions.

However I think most people who post on the forum about blocked/closed accounts omit information when making enquiries. Bank's are generally not in the business of blocking accounts for no reason.