Should my bank be asking me how I am spending my money when I make large cash withdrawals?

Zecis

Context: Im doing a building project and trying to save money by buying over ordered materials from others...they generally want cash payments. My bank is insisting on knowing who these people are and why I'm paying them in cash. Am I right to refuse to tell them?

Zecis

The closest bank branch is a 2 hour journey away, so I'm drawing a five figure sum

eskbanker

Yes, the bank has obligations under AML/KYC regulations to take reasonable measures to satisfy itself that very large cash withdrawals aren't being used for nefarious purposes....

Edit: there's no point in setting up (or answering) a poll unless the question is clearer - if the question is 'is the bank acting correctly under existing legislation/regulation' then the answer is factually yes, so isn't something to be voted on, but if the question is 'are current rules and regulations perhaps too stringent' then that's an entirely different issue, on which various differing opinions would be valid.

MattMattMattUK

Yes the bank are right

If you keep refusing to tell them you might have bigger issues. 

AmityNeon

Yes the bank are right

Five-figure withdrawals for in-person transactions are major red flags; banks would be grossly negligent if they didn't ask questions.

k12479

No, they shouldn't be asking. But neither should you be whining that they should have done more to protect you when you get scammed nor complaining when they close your account.

elsien

k12479 said:

No, they shouldn’t be asking. But neither should you be whining that they should have done more to protect you when you get scammed nor complaining when they close your account.

Not accurate. If they suspect money laundering, they have an obligation to check it out. 

born_again

Yes the bank are right

If you want to be protected from scams & get your money back... The answer is simple. 

Refusal to answer questions, will mean payments not made. Same with taking 5 figure cash at branch, banks do have a right to say no & block your account.

Remember you take all that cash out & get burgled... You will not get it back, how would you feel then?

prowla

My opinion is it's none of their business.

However, there is a point about due diligence: both protecting you from scams and them from money laundering.

I suppose you could simply say you're buying luxury item (eg. a watch) or a car.

grumbler

elsien said:

k12479 said:

No, they shouldn’t be asking. But neither should you be whining that they should have done more to protect you when you get scammed nor complaining when they close your account.

... If they suspect money laundering, they have an obligation to check it out. 

     Withdraw cash to lauder it?! This is something new....

eskbanker said:
Yes, the bank has obligations under AML/KYC regulations to take reasonable measures to satisfy itself that very large cash withdrawals aren't being used for nefarious purposes....

Edit: there's no point in setting up (or answering) a poll unless the question is clearer - if the question is 'is the bank acting correctly under existing legislation/regulation' then the answer is factually yes, so isn't something to be voted on, but if the question is 'are current rules and regulations perhaps too stringent' then that's an entirely different issue, on which various differing opinions would be valid.

I think, the 'existing legislation' is far too vague. As a result banks are between a rock and a hardplace, have to improvise and their actions depend a lot on how their local pinkertons interpret the 'legislation'.
If I tell them that I'm buying a car, will this 'satisfy' them? Can they check this even if I tell them who the seller is? Not really. They are covering their asses  in the first place - to satisfy the stupid regulations.

GeoffTF

Yes the bank are right

grumbler said:

If I tell them that I'm buying a car, will this 'satisfy' them? Can they check this even if I tell them who the seller is? Not really. They are covering their asses  in the first place - to satisfy the stupid regulations.

That is a common scam. They are going want details.