By Bob Howard
Reporter, Money Box
BBC:
Some HSBC customers have
been prevented from withdrawing large amounts of cash because they could
not provide evidence of why they wanted it, the BBC has learnt.
Listeners have told Radio 4's Money Box they were stopped from withdrawing amounts ranging from £5,000 to £10,000. HSBC admitted it has not informed customers of the change in policy, which was implemented in November. The bank says it has now changed its guidance to staff.
New rules
Stephen Cotton went to his local HSBC branch this month to
withdraw £7,000 from his instant access savings account to pay back a
loan from his mother.
A year before, he had withdrawn a larger sum in cash from HSBC without a problem.
But this time it was different, as he told Money Box: "When
we presented them with the withdrawal slip, they declined to give us the
money because we could not provide them with a satisfactory explanation
for what the money was for. They wanted a letter from the person
involved."
Mr Cotton says the staff refused to tell him how much he
could have: "So I wrote out a few slips. I said, 'Can I have £5,000?'
They said no. I said, 'Can I have £4,000?' They said no. And then I
wrote one out for £3,000 and they said, 'OK, we'll give you that.' "
He asked if he could return later that day to withdraw
another £3,000, but he was told he could not do the same thing twice in
one day.
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As this was not a change to the Terms and Conditions of your bank account we had no need to pre-notify customers of the change”
HSBC customer letter
He wrote to complain to HSBC about the new rules and also that he had not been informed of any change.
The bank said it did not have to tell him. "As this was not a
change to the Terms and Conditions of your bank account, we had no need
to pre-notify customers of the change," HSBC wrote.
Frustrated customers
Mr Cotton cannot understand HSBC's attitude: "I've been
banking in that bank for 28 years. They all know me in there. You
shouldn't have to explain to your bank why you want that money. It's not
theirs, it's yours."
Peter from Wiltshire, who wanted his surname withheld, had a similar experience.
He wanted to take out £10 000 cash from HSBC, some to pay to his sons and some to fund his long-haul travel plans.
Peter phoned up the day before to give HSBC notice and everything seemed to be fine.
The next day he got a call from his local branch asking him
to pay his sons via a bank payment and to provide booking receipts for
his holidays. Peter did not have any booking receipts to show.
The following day he spoke to HSBC again and this time, having examined his account, it said he could withdraw the £10,000.
Belinda Bell is another customer who was initially denied her
cash, in her case to pay her builder. She told Money Box she had to
provide the builder's quote.
Customer protection
HSBC has said that following customer feedback, it was
changing its policy: "We ask our customers about the purpose of large
cash withdrawals when they are unusual and out of keeping with the
normal running of their account. Since last November, in some instances
we may have also asked these customers to show us evidence of what the
cash is required for."
"The reason being we have an obligation to protect our
customers, and to minimise the opportunity for financial crime. However,
following feedback, we are immediately updating guidance to our
customer facing staff to reiterate that it is not mandatory for
customers to provide documentary evidence for large cash withdrawals,
and on its own, failure to show evidence is not a reason to refuse a
withdrawal. We are writing to apologise to any customer who has been
given incorrect information and inconvenienced."
Continue reading the main story
In a sense your money becomes pocket money and the bank becomes your parent”
Douglas Carswell
MP for Clacton
Money Box asked other banks what their policy is on large cash withdrawals.
They all said they reserved the right to ask questions about large cash withdrawals.
But none of them said they would require evidence of what the money was being used for before paying out.
Douglas Carswell, the Conservative MP for Clacton, is alarmed
by the new HSBC policy: "All these regulations which have been imposed
on banks allow enormous interpretation. It basically infantilises the
customer. In a sense your money becomes pocket money and the bank
becomes your parent."
But Eric Leenders, head of retail at the British Bankers
Association, said banks were sensible to ask questions of their
customers: "I can understand it's frustrating for customers. But if you
are making the occasional large cash withdrawal, the bank wants to make
sure it's the right way to make the payment."
