Your browser isn't supported
It looks like you're using an old web browser. To get the most out of the site and to ensure guides display correctly, we suggest upgrading your browser now. Download the latest:

Welcome to the MSE Forums

We're home to a fantastic community of MoneySavers but anyone can post. Please exercise caution & report spam, illegal, offensive or libellous posts/messages: click "report" or email forumteam@.

Search
  • FIRST POST
    • RetiredandHappy
    • By RetiredandHappy 6th Jul 18, 3:23 PM
    • 11Posts
    • 0Thanks
    RetiredandHappy
    Gifted Deposit - Onerous checking - how necessary?
    • #1
    • 6th Jul 18, 3:23 PM
    Gifted Deposit - Onerous checking - how necessary? 6th Jul 18 at 3:23 PM
    I gifted my daughter some money last October which she is now using as part of a deposit for a house purchase.
    She declared it as a gift and I have signed a template letter provided by the mortgage advisor stating that it is a gift and that I have no claim on the money.
    He wants to check my identity (passport - I am grudgingly OK with that) and have a copy of my bank statement. I am playing up about that as it contains a lot of information that clearly has no bearing on money-laundering (transactions after I handed the money on, transactions involving my other daughters, my savings account number) and does not provide anything to satisfy him as my gift came from a deposit paid into the account only hours earlier.
    In fact it came from my share account and it appears he may wish to pore through that. Ultimately the money was inherited when my parents passed on - but where did they get it from? (Undoubtedly a Russian Billionaire - not).
    I tried redacting the information he did not need and may have gone one step too far with that as I took out the incoming payment as well as the genuinely irrelevant stuff. He is now saying no redaction is permitted.
    Does the FCA really say that I have to tell the world my financial affairs. (World - himself, anybody who works with him who can access the file, the mortgage company - who knows how many people there, the solicitor, her colleagues etc)
    One minute we are supposed to be being very cautious about our personal information and the next government is insisting we spread it around wildly.
    Any comments, advice, is he going over the top, where does it end.
Page 1
    • sandyk01
    • By sandyk01 6th Jul 18, 3:26 PM
    • 42 Posts
    • 5 Thanks
    sandyk01
    • #2
    • 6th Jul 18, 3:26 PM
    • #2
    • 6th Jul 18, 3:26 PM
    My parents gave me a gift which was used ad a deposit. The solicitor wanted a copy of their bank statement to check that it actually came from their account- we provided this as couldn't see a way around. We did however block out account numbers etc of the statement.

    Perhaps others can share their experiences of similar situations to help.

    All the best.
    • kingstreet
    • By kingstreet 6th Jul 18, 4:20 PM
    • 34,352 Posts
    • 18,659 Thanks
    kingstreet
    • #3
    • 6th Jul 18, 4:20 PM
    • #3
    • 6th Jul 18, 4:20 PM
    It is normal for lenders to request a gifted deposit form/letter and donor bank statement showing the funds going out and recipient bank statement for receipt.

    They may not request this up-front, but often insist the broker obtains and hold such documentation on file against a future request.

    Solicitors also request this, along with ID for the donor.

    The Money Laundering Act isn't FCA. Those of us in the industry set our own interpretation/requirements for its satisfaction, so there is no right and wrong answer, until we find out we've done something wrong.
    I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.
    • Carrot007
    • By Carrot007 6th Jul 18, 4:23 PM
    • 1,727 Posts
    • 1,471 Thanks
    Carrot007
    • #4
    • 6th Jul 18, 4:23 PM
    • #4
    • 6th Jul 18, 4:23 PM
    Pretty much if you want it to bne able to be used as a deposit.


    Your daughte's solicitor will probably charge 100 for having to deal with it too. Gifts are not free for housing purchases!
    • Lauralou79
    • By Lauralou79 6th Jul 18, 5:26 PM
    • 251 Posts
    • 270 Thanks
    Lauralou79
    • #5
    • 6th Jul 18, 5:26 PM
    • #5
    • 6th Jul 18, 5:26 PM
    We had a large deposit 20,000 of which was gifted. We had to provide statements to mortgage from my father in law to prove where it had came from and I'm sure the solicitors wanted one from a few months previous too to show where it had come from.

    I'm under the impression it's all normal proceedings but I did blank out account numbers and personal details not needed
    • somethingcorporate
    • By somethingcorporate 6th Jul 18, 5:30 PM
    • 8,975 Posts
    • 8,702 Thanks
    somethingcorporate
    • #6
    • 6th Jul 18, 5:30 PM
    • #6
    • 6th Jul 18, 5:30 PM
    We gifted a deposit to my sister around 20k, no questions were asked aside from the provision of a letter.
    Thinking critically since 1996....
    • sal_III
    • By sal_III 6th Jul 18, 8:15 PM
    • 653 Posts
    • 667 Thanks
    sal_III
    • #7
    • 6th Jul 18, 8:15 PM
    • #7
    • 6th Jul 18, 8:15 PM
    It's all butt covering exercise on part of the solicitors. The lawmakers in their infinite wisdom decided to make them liable under the money laundering act for any "dirty" money used for property purchases.

    Many of them do not fully understand the regulations and are going overboard just to be on the safe side.

    I had a massive row over this with my solicitor but at the end relented and just handed over the information to meet the exchange deadline.

    It's all completely useless and ridiculous, they only focus on lump sums in your account in the past 3-6 months. So if you make/receive the gift 6 months in advance, no one will ask you about it, it's just savings... It's the same bloody money.

    And how can you suspect someone that is scraping a 5% deposit and borrowing the other 95% of money laundering...

    Then it's public secret that half of central London is in the hands of foreign individuals and off-shore companies with unknown owners, but like so many other things it's much easier to go after the little guys.
    • Thrugelmir
    • By Thrugelmir 6th Jul 18, 9:22 PM
    • 61,075 Posts
    • 54,294 Thanks
    Thrugelmir
    • #8
    • 6th Jul 18, 9:22 PM
    • #8
    • 6th Jul 18, 9:22 PM
    It's all butt covering exercise on part of the solicitors. The lawmakers in their infinite wisdom decided to make them liable under the money laundering act for any "dirty" money used for property purchases.
    Originally posted by sal_III
    Not all solicitors adhered to the rules in the past. Collusion between parties was part of the reason behind the downfall of the Chesea Building Society.
    Financial disasters happen when the last person who can remember what went wrong last time has left the building.
    • sal_III
    • By sal_III 6th Jul 18, 9:37 PM
    • 653 Posts
    • 667 Thanks
    sal_III
    • #9
    • 6th Jul 18, 9:37 PM
    • #9
    • 6th Jul 18, 9:37 PM
    Not all solicitors adhered to the rules in the past. Collusion between parties was part of the reason behind the downfall of the Chesea Building Society.
    Originally posted by Thrugelmir
    All UK banks are already on the hook for money laundering, I have worked for several banks and they are really taking it seriously on every level. If the deposit monies are coming from the UK bank account this should be a sufficient reason to consider them "clean" and if they turn out to be dirty the banks are already liable. So why involving another layer of checks? At least limit the double checking to large amounts, say 100k+, there are much easier ways to launder 20-30k than using them as a deposit for residential mortgage.
    • julicorn
    • By julicorn 6th Jul 18, 9:56 PM
    • 389 Posts
    • 1,430 Thanks
    julicorn
    If I remember right, my in-laws just blacked out all other transactions in the copy of the bank statements they provided.
    • AdrianC
    • By AdrianC 7th Jul 18, 9:20 AM
    • 19,101 Posts
    • 17,509 Thanks
    AdrianC
    Yeh, why on earth do solicitors need to do any kind of money-laundering checks on that gift from Uncle Pablo in Medellin, Uncle Vito in Palermo, or Uncle Vladimir in Moscow, anyway?
    • RetiredandHappy
    • By RetiredandHappy 8th Jul 18, 12:28 PM
    • 11 Posts
    • 0 Thanks
    RetiredandHappy
    Yeh, why on earth do solicitors need to do any kind of money-laundering checks on that gift from Uncle Pablo in Medellin, Uncle Vito in Palermo, or Uncle Vladimir in Moscow, anyway?
    Originally posted by AdrianC
    Well yes, but as the OP was about a Mortgage Broker collecting data (on a statement) that had no relevance to the gift, involving money that had sat in a British Bank for over 8 months so plenty of time for money-laundering checks there and the gift was from a British Father rather than foreign uncle - is your comment useful, helpful or worthwhile?

    Thank you to the others for their experiences.
    • AdrianC
    • By AdrianC 8th Jul 18, 12:29 PM
    • 19,101 Posts
    • 17,509 Thanks
    AdrianC
    If it's sat in a UK bank for 8 months, then it's probably legit. Which is why they need to see the bank statements which the kind donor is reluctant to provide.
    • RetiredandHappy
    • By RetiredandHappy 8th Jul 18, 4:22 PM
    • 11 Posts
    • 0 Thanks
    RetiredandHappy
    No - it sat in my daughters bank for 8 months - her statements prove that which she supplied - October to July. And it got there from the current account of a major british bank - the sort codes show that.

    However it is good to know that 8 months is reasonable evidence for you that it is legit - thank you for that
    • JuicyJesus
    • By JuicyJesus 8th Jul 18, 4:50 PM
    • 3,345 Posts
    • 3,710 Thanks
    JuicyJesus
    If the deposit monies are coming from the UK bank account this should be a sufficient reason to consider them "clean"
    Originally posted by sal_III
    That doesn't make any sense. In your reading of things, no money that has ever been in a UK bank account could possibly be laundered.

    You know what placement, layering and integration is, right?
    urs sinserly,
    ~~joosy jeezus~~
    • kingstreet
    • By kingstreet 8th Jul 18, 5:04 PM
    • 34,352 Posts
    • 18,659 Thanks
    kingstreet
    You know what placement, layering and integration is, right?
    Originally posted by JuicyJesus
    Quite.

    The whole point is that every link in the chain of a financial transaction can/should add to the audit trail/evidence should a future money laundering case be investigated.
    I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.
    • AnotherJoe
    • By AnotherJoe 8th Jul 18, 5:13 PM
    • 11,517 Posts
    • 13,330 Thanks
    AnotherJoe
    Quite.

    The whole point is that every link in the chain of a financial transaction can/should add to the audit trail/evidence should a future money laundering case be investigated.
    Originally posted by kingstreet

    Right but at what point do they stop \'



    The OP put the money into his account from a share transaction.

    How does he prove where the money to buy the shares came from, etc.


    As another poster said its stupid **** covering that doesnt actually stop any "real" money laundering but its easier to go after the little people than actually do soemthing about overseas accounts etc. What happens when mr abromovitch buys a penthouse in Chelsea for 20M. Anyone think he has to show his bank account details?


    I guess the answer is, for anyone contemplating this in the future as its too late for the OP, xfer the money via a bank account you dont use for your main banking, just for incidental transactions.
    • JuicyJesus
    • By JuicyJesus 8th Jul 18, 6:45 PM
    • 3,345 Posts
    • 3,710 Thanks
    JuicyJesus
    Right but at what point do they stop \'



    The OP put the money into his account from a share transaction.

    How does he prove where the money to buy the shares came from, etc.
    Originally posted by AnotherJoe
    Who's said he had to?


    As another poster said its stupid **** covering that doesnt actually stop any "real" money laundering but its easier to go after the little people than actually do soemthing about overseas accounts etc. What happens when mr abromovitch buys a penthouse in Chelsea for 20M. Anyone think he has to show his bank account details?
    Yes.

    I guess the answer is, for anyone contemplating this in the future as its too late for the OP, xfer the money via a bank account you dont use for your main banking, just for incidental transactions.
    I mean yeah suddenly running huge sums of money through an account that isn't used for anything doesn't look dodgy or out of character at all and will definitely avoid scrutiny.
    urs sinserly,
    ~~joosy jeezus~~
    • RetiredandHappy
    • By RetiredandHappy 8th Jul 18, 7:30 PM
    • 11 Posts
    • 0 Thanks
    RetiredandHappy
    In this case, AnotherJoe's suggestion it would probably have been acceptable as it would demonstrate the link through that account between the money going in from the share sale (a recognised British broker) and out to my daughter. That is all he claims to want to be able to do.
    All the rest of the information on the main account statement is apparently of no interest to him - but if his security is not as good as he thinks then it could be to others. But he will not agree to it being redacted.
    • AnotherJoe
    • By AnotherJoe 8th Jul 18, 8:31 PM
    • 11,517 Posts
    • 13,330 Thanks
    AnotherJoe
    I mean yeah suddenly running huge sums of money through an account that isn't used for anything doesn't look dodgy or out of character at all and will definitely avoid scrutiny.
    Originally posted by JuicyJesus
    It will avoid scrutiny of unrelated transactions that are no business of the person checking.

    They aren't meant to be vetting the whole account, just the transfer. So there is no scrutiny needed or done other than to check money went from father to daughter.
Welcome to our new Forum!

Our aim is to save you money quickly and easily. We hope you like it!

Forum Team Contact us

Live Stats

192Posts Today

2,342Users online

Martin's Twitter