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

400ixl

Yes the bank are right

grumbler said:

born_again said:

grumbler said:

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.

Money paid into account from iffy sources, withdrawn. Is exactly how its done 🤦‍♀️

Ha-ha.
Normally it's dirty untraceable cash that needs laundering and depositing. And if it's the sources that they are concerned about, they should ask different questions, not about spending this cash.

And what do they need out at the other end for many of these illegal activities, clean cash. Laugh if you want, and try to put them down but actually they are right.

It is the whole process they are concerned about, money in, transfers and money out.

That is just one of the concerns though, as above, they are looking for people getting scammed etc. They will also be looking at whether money was just transferred in and then being withdrawn as a red flag. 

I never understand people getting offended by the bank asking questions to try to protect them. Just answer and move on. If it saves 1 person getting scammed then all the better.

eskbanker

grumbler said:

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'.

Are you suggesting repealing the legislation or making it more transparently prescriptive?  If the latter, how would you suggest it's done in such a way as to fulfil its purpose without highlighting obvious workarounds?

grumbler

eskbanker said:

grumbler said:

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'.

Are you suggesting repealing the legislation or making it more transparently prescriptive?  If the latter, how would you suggest it's done in such a way as to fulfil its purpose without highlighting obvious workarounds?

Well, this can be said about ANY legislation. Let's make all our laws as vague as possible and open to interpretation!

Obvious workarounds and loopholes have to be dealt with and closed.

Bogaboo words like AMR, DPA etc. are used left, right and centre to justify pretty much anything - and this thread is a good example.

IMO, this particular case has nothing to do with AML - simply because a bank is incapable of checking anything that a customer says about the intended use of the cash.

I agree with what was said above - in this case the questions are asked to protect idiots from scammers. It's a pity that banks have a duty to do this - I feel sorry for them. However, if this is true, they can do this in more delicate and less invasive manner.

And it's a pity that in our society cash became pretty much the only safe way of selling expensive items privately.

eskbanker

grumbler said:

eskbanker said:

grumbler said:

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'.

Are you suggesting repealing the legislation or making it more transparently prescriptive?  If the latter, how would you suggest it's done in such a way as to fulfil its purpose without highlighting obvious workarounds?

Well, this can be said about ANY legislation. Let's make all our laws as vague as possible and open to interpretation!

Obvious workarounds and loopholes have to be dealt with and closed.

I think you're missing the point - in general it makes sense for legislation and regulation to be as specific and transparent as possible, but in this context it's effectively saying that financial institutions must have robust risk management policies and procedures (which may serve multiple purposes, i.e. scam protection as well as AML/KYC), without going as far as nominating, for example, a cash value above which withdrawals need to be questioned.  Likewise, many fraud detection algorithms will use a variety of other factors about account conduct in order to determine whether a given transaction should be flagged for further assessment, but if these were to be publicised then this would clearly be self-defeating.

Taking OP's example of withdrawing a five-figure cash sum, if they knew that this would be challenged and considered that there was something to hide, then chances are they'd try splitting the withdrawal into multiple four-figure ones instead.  However, it wouldn't surprise me to learn that OP's bank might not challenge someone else's five-figure cash withdrawal, and conversely might question smaller withdrawals from other customers - I do get the point about lack of transparency but really can't see the alternative?

grumbler said:

Bogaboo words like AMR, DPA etc. are used left, right and centre to justify pretty much anything - and this thread is a good example.

IMO, this particular case has nothing to do with AML - simply because a bank is in capable of checking anything that a customer says about the intended use of the cash.

We obviously don't know the exact reason why the bank challenged OP's withdrawal so to a certain extent we're all speculating, but my point above is that the risk-based policies won't be dedicated specifically to individual pieces of legislation.

grumbler said:
I agree with what was said above - in this case the questions are asked to protect idiots from scammers. It's a pity that banks have a duty to do this - I feel sorry for them. However, if this is true, they can do this in more delicate and less invasive manner.

Apart from OP's obvious indignation at the principle of being asked at all (although to be fair they didn't deploy the traditional "it's MY MONEY" line that threads like this usually do), I didn't see anything that suggested indelicate and invasive questioning?

eDicky

400ixl said:

grumbler said:

born_again said:

grumbler said:

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.

Money paid into account from iffy sources, withdrawn. Is exactly how its done 🤦‍♀️

Ha-ha.
Normally it's dirty untraceable cash that needs laundering and depositing. And if it's the sources that they are concerned about, they should ask different questions, not about spending this cash.

And what do they need out at the other end for many of these illegal activities, clean cash. Laugh if you want, and try to put them down but actually they are right.

I'm trying to imagine what kind of illegal activities require 'clean' cash, and how money in the form of cash can be distinguished as being clean...

Section62

Yes the bank are right

eDicky said:

400ixl said:

grumbler said:

born_again said:

grumbler said:

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....

Money paid into account from iffy sources, withdrawn. Is exactly how its done 🤦‍♀️

Ha-ha.
Normally it's dirty untraceable cash that needs laundering and depositing. And if it's the sources that they are concerned about, they should ask different questions, not about spending this cash.

And what do they need out at the other end for many of these illegal activities, clean cash. Laugh if you want, and try to put them down but actually they are right.

I'm trying to imagine what kind of illegal activities require 'clean' cash, and how money in the form of cash can be distinguished as being clean...

Whilst the money is in the banking system there's an audit trail.  The end goal is to break that audit trail so the ultimate asset cannot be linked to the 'crime'.

Crime has moved on since the 1950's... now people tend to keep their wealth electronically in some form of banking system, anyone wanting to deprive them of that wealth for their own unlawful gain inevitably involves cashing that wealth out of the system, otherwise you are going to get caught.

And with the Proceeds of Crime Act and such things as unexplained wealth orders, it is no good anymore taking bundles of 'clean' cash and depositing them with your friendly local bank manager who doesn't ask questions.  That lark is over.  Stuffing your bank accounts with ill-gotten gains is a great way of getting caught.

So contrary to grumbler's assertion, the desirable thing to do these days is cashing money out of the banking system (preferably from someone else's account) in a way which permits conversion to an asset that cannot be traced.  I.e. what born_again said.

Ballard

Whilst there could be examples of launderers hoarding cash, it’s really about getting money into the banking system so that ‘clean’ assets can be bought. The tricky bit is getting the cash in, of course.

This does indeed create an audit trail and this is where criminals need to create false documents to give the impression that everything is in order. 

Zecis

For me it's not really a secret as to what the money is being spent on...it's more of a principle thing...why should they vet me as to how I am spending my money...

IanManc

Zecis said:

For me it's not really a secret as to what the money is being spent on...it's more of a principle thing...why should they vet me as to how I am spending my money...

No, it isn't a "principle thing".

Legislation to detect and prevent money laundering in this country is very wide in its ambit. Financial institutions face big penalties and nasty consequences unless they comply, and can show that they are complying.

You've decided it is a "principle thing" when it just isn't. When you realise that it isn't a "principle thing" then you'll stop being offended by the questions.

400ixl

Yes the bank are right

Zecis said:

For me it's not really a secret as to what the money is being spent on...it's more of a principle thing...why should they vet me as to how I am spending my money...

As has been discussed, you could be withdrawing cash under duress or mis representation from a scammer and this is an opportunity for that to be intercepted and possibly stopped.

That's just one example.

I really don't get the principle thing. It is to help protect you, or check its legal. its not that they want to know if you are going to buy a Ford or a Mercedes and therefor profile you.