US persons having to close accounts in UK

prudryden · 29 January 2010 at 7:53PM

OK - it's now public. Pershing UK, a British registered company, has declared that all US persons, which includes people born in the UK and who have lived here all their life, but who may have a US passport due to one parent being a US citizen , will have to close their accounts by Sept 2010. It doesn't matter if you also have a UK passport.

Evidently, other financial institutions are to follow.

So, how will the FSA look at this in line with their Treating Customers Fairly regulations??

How will the UK Gov't look at this in line with the Race Relations Act of 1976 as amended 2003? This act specifically mentions nationality and Nation of Origin as part of the meaning of race.

tradetime · 29 January 2010 at 8:04PM

What is Pershing UK, and what sort of "accounts" do people hold with it? I am only familiar with Pershing Square, a US Hedge fund and Pershing LLC which provides Investment services for institutional client accounts

gozomark · 29 January 2010 at 8:07PM

Who. or what, are Pershing UK ?

[edit - posted same time]

tradetime · 29 January 2010 at 8:12PM

LOL I thought maybe it was just me.

Apart from the hedge fund, which I'm pretty sure it isn't cause I don't think it has anything in the UK, this is the only other one I know.
http://www.pershing.co.uk/index.html

prudryden · 29 January 2010 at 9:29PM

tradetime wrote: »

LOL I thought maybe it was just me.

Apart from the hedge fund, which I'm pretty sure it isn't cause I don't think it has anything in the UK, this is the only other one I know.
http://www.pershing.co.uk/index.html

That's the company, Pershing Securities Ltd which is an affiliate of Pershing LLC. Also known locally in the trade as Pershing UK which differentiates it from Pershing US. Pershing is the world's largest custodian. You are correct, their clients are the brokerage firms (institutions as you call them) that we as individuals have accounts with. Your account may be custodied with Pershing if you use one of these firms. Check the bottom of your statements. It may say cleared by Pershing Securities Ltd. Pershing provides the backoffice administration and issues statements/evaluations to you in the name of your firm. Pershing has instructed their brokerage/investment firm clients to close all US persons accounts. Some firms like Charles Stanley do their own custody. Many use Pershing.

Cook_County · 30 January 2010 at 12:45AM

Can you provide evidence for this allegation eg a news story, company website link etc?

prudryden · 30 January 2010 at 12:58AM

Cook_County wrote: »

Can you provide evidence for this allegation eg a news story, company website link etc?

Try WealthBriefing.com the 21st December 2009 issue. Here is the lead in to the story. If you can't find it on the net - PM me and I can send you the story privately, if I can dig it up again. Cheers.

Today WealthBriefing reports that soaring tax compliance costs for US citizens living abroad has prompted one of the worlds largest custody firms to close its service to UK-based clients.

WealthBriefing will not be updated between 23 December and 3 January due to the holiday season. Updates will resume on 4 January 2010.

Breaking News:
<A title=# href="outbind://1-00000000F1516E3E289B1346A44898F733FF9FAD07005B94CD06B1353E4B89A2A0D78FDCF0E50000007102DB00006B8EF988F37BA640A690C04FB1A761D60000054F747B0000/#">[FONT=Arial, Helvetica, sans-serif]Big US Custodian Downgrades UK Business As IRS Tax Burdens Soar [/FONT]

prudryden · 30 January 2010 at 1:03AM

Cook_County wrote: »

Can you provide evidence for this allegation eg a news story, company website link etc?

Official closure letters haven't gone out yet and clients are still unaware that they will have to close their accounts. Pershing has given their institutional clients until Sept 2010 to close the accounts. Perhaps, the FSA, once it knows about it, may have something to say in regards to their Treating Customers Fairly Regulations. Or even the discriminatory agencies, but I doubt it.

noh · 30 January 2010 at 1:17AM

prudryden wrote: »

Official closure letters haven't gone out yet and clients are still unaware that they will have to close their accounts. Pershing has given their institutional clients until Sept 2010 to close the accounts. Perhaps, the FSA, once it knows about it, may have something to say in regards to their Treating Customers Fairly Regulations. Or even the discriminatory agencies, but I doubt it.

I doubt it too,
It is clear they have made a business decision.
They have decided to close the accounts of all US citizens as the cost of administering those accounts is becoming too high.
That isn't treating customers unfairly or discriminating against anyone on grounds of race.

97trophy · 30 January 2010 at 1:20AM

blame Obama.

prudryden · 30 January 2010 at 1:48AM

noh wrote: »

I doubt it too,
It is clear they have made a business decision.
They have decided to close the accounts of all US citizens as the cost of administering these accounts is becoming too high.
That isn't treating customers unfairly or discriminating against anyone on grounds of race.

But is it any different than a UK company saying we will not service your account because you are Indian or Pakistani? This is prohibited under the RRA of 1976.
Surely, financial reasons are not justifiable for discrimination of one's nationality or nation of origin.

And how can a UK company be seen to be treating all customers fairly when some customers can't get served at all? According to the FSA, all customers should be treated equally.

US persons having to close accounts in UK

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