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A bank's right to know

including wills and probate
UncleEbenezer
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A bank's right to know

#500324

Postby UncleEbenezer » May 13th, 2022, 6:42 pm

I've started to get annoying and persistent messages from Starling Bank. They need more information from me.

Today I ill-advisedly clicked yes to updating my information. The first question was my tax residency: OK, (probably) fair enough. Though horribly poorly designed: I had to scroll a long, long way through an alphabetical list of countries to select UK. Nothing so sensible as defaulting to the country my address is in (erm, UK), or even allowing me to type "u" to reach that part of the alphabet.

Second question is about my income. How much (in bands), where from (multiple choice, no option for "it's complicated", let alone "mind your own effing business"). I think there were about five subsections to the income question, but in the absence of "none of the above" I stopped at #2. Now the nag has become more persistent :evil:

Do they have any legal right whatsoever to demand this kind of information from an existing customer? I don't recollect what information I gave when I opened the account, but I guess whatever they asked back then seemed fair enough.

tacpot12
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Re: A bank's right to know

#500349

Postby tacpot12 » May 13th, 2022, 9:01 pm

They have a duty to know their customers and this gives them the right to ask for and process any information they might reasonably determine is necessary for this. You could complain about the process for capturing the information being poor, but you can't really complain about them asking the questions that they are required to by their regulator.

Alaric
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Re: A bank's right to know

#500350

Postby Alaric » May 13th, 2022, 9:13 pm

tacpot12 wrote:You could complain about the process for capturing the information being poor, but you can't really complain about them asking the questions that they are required to by their regulator.


Is it not the case that the actual requirements of the regulator are expressed in fairly general and nebulous terms? If that was not the case, all banks would be asking the same intrusive questions. They aren't, which demohnstrates that it's the bank driving the questions.

In any event if that's someone's main or only bank account, the bank can look up what their customer earns net of tax from the payments going through the account.

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Re: A bank's right to know

#500365

Postby elkay » May 14th, 2022, 1:12 am

I was similarly annoyed when I encountered the same questions from Starling. I understand the requirement for income information if borrowing, but I am not borrowing. The regulator certainly does not require this information to be captured. In fact, just thinking about it, I think they are contravening the ICO guidance that they should only store data necessary to provide the service. They certainly do not need to know my income when I am not borrowing from them.

roger4
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Re: A bank's right to know

#500368

Postby roger4 » May 14th, 2022, 3:23 am

One of the bank's responsibilities is to be aware if there are any irregular amounts moving through the accounts it controls, and by asking the customer for their income expectations, the bank can establish what is "normal". Then it is a fairly simple matter to judge if there are any irregular transactions.
The penalties on the banks for failing to advise if one of its customers is likely breaching money laundering regulations are harsh.

Hence the questions.

Roger

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Re: A bank's right to know

#500369

Postby Lootman » May 14th, 2022, 6:06 am

roger4 wrote:One of the bank's responsibilities is to be aware if there are any irregular amounts moving through the accounts it controls, and by asking the customer for their income expectations, the bank can establish what is "normal". Then it is a fairly simple matter to judge if there are any irregular transactions.
The penalties on the banks for failing to advise if one of its customers is likely breaching money laundering regulations are harsh.

Hence the questions.

Define "irregular". There are plenty of people whose incomes or outgoings are "irregular". It does not mean foul play.

Besides, such a pattern of transactions would already be known by the bank. It doesn't explain these questions.

And I suspect the real big-time money launderers are not using small-time institutions like Starling bank. In fact they probably aren't using banks at all. This is just another "tick the box" exercise which achieves nothing other than the delusion of due diligence.

stevensfo
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Re: A bank's right to know

#500372

Postby stevensfo » May 14th, 2022, 8:17 am

UncleEbenezer wrote:I've started to get annoying and persistent messages from Starling Bank. They need more information from me.

Today I ill-advisedly clicked yes to updating my information. The first question was my tax residency: OK, (probably) fair enough. Though horribly poorly designed: I had to scroll a long, long way through an alphabetical list of countries to select UK. Nothing so sensible as defaulting to the country my address is in (erm, UK), or even allowing me to type "u" to reach that part of the alphabet.

Second question is about my income. How much (in bands), where from (multiple choice, no option for "it's complicated", let alone "mind your own effing business"). I think there were about five subsections to the income question, but in the absence of "none of the above" I stopped at #2. Now the nag has become more persistent :evil:

Do they have any legal right whatsoever to demand this kind of information from an existing customer? I don't recollect what information I gave when I opened the account, but I guess whatever they asked back then seemed fair enough.


I've had one or two of these over the last few years and they're very simple. I just give the closest approximate answer and don't worry about it. It's certainly nowhere as bad as some of the new fintech banks that will freeze your account with no warning until you send yet another photo of your I.D.! :evil:

As others have said, it's to cover their backs and avoid any criticism about appropriate money laundering checks etc. I'm pretty sure that the authorities have a pretty good idea of where the corruption is, but just as in airport security, they have to be seen to check everyone.

Steve

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Re: A bank's right to know

#500373

Postby Lootman » May 14th, 2022, 8:29 am

stevensfo wrote:I've had one or two of these over the last few years and they're very simple. I just give the closest approximate answer and don't worry about it. It's certainly nowhere as bad as some of the new fintech banks that will freeze your account with no warning until you send yet another photo of your I.D.! :evil:

As others have said, it's to cover their backs and avoid any criticism about appropriate money laundering checks etc. I'm pretty sure that the authorities have a pretty good idea of where the corruption is, but just as in airport security, they have to be seen to check everyone.

I think it is more likely that these questions are designed to meet "know your customer" requirements, which exist to avoid the mis-selling of inappropriate financial products.

Whereas anti money laundering checks are more likely to operate off the actual transaction flow in your account such that, if there is normally 2 grand going in and out of your account every month, and then suddenly 100K passes through, then that might be flagged to an authority. In fact I think read somewhere that any transaction over 10K is reported to the authorities, which may perhaps lead to a lot of 9K transactions?

Also, your bank has no idea about what other bank accounts you have, so they only ever see a partial view of your financial activity. People up to no good would presumably spread their activity across several or many institutions, so that each individual bank sees nothing abnormal.

As for specifically asking about income, I would agree with someone upthread who said that makes more sense if you are borrowing. And I have been asked that when applying for a credit card. I give them a random number which easily qualifies me for the credit limit I am seeking.

Anyone who was setting out to launder money would presumably, if asked that question, give a very high income amount, so that their subsequent transactions would all appear to be "normal". The only money launderers likely to be caught from their answer to such a question are very very bad ones!

DrFfybes
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Re: A bank's right to know

#500376

Postby DrFfybes » May 14th, 2022, 8:54 am

UncleEbenezer wrote:I've started to get annoying and persistent messages from Starling Bank. They need more information from me.
.


As mentioned, there could be all osrts of reasons for the request. I don't recall anything much from Lloyds when I switched earlier this year, but there might have been some general tick a box of income bands type thing. Not had any problems moving large chunks when sorting mum's estate so I must have given them the info they wanted.

However, if you aren't happy with their service, there are other options :)

Maroochydore
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Re: A bank's right to know

#500578

Postby Maroochydore » May 15th, 2022, 2:28 pm

stevensfo wrote:freeze your account with no warning until you send yet another photo of your I.D.!

I had a variation of this with sending currency to Australia via World Remit. I normally use Currency Fair but thought I'd give World Remit a go, must have been some advantage but can't remember what.

First couple of transfers went OK but on the third they suddenly sent an e-mail which said:

As a valued customer who has transacted over £11,000, we now need to collect some additional information from you as part of our obligations as a regulated company and, above all, to keep your money safe

Please can you provide us with the following information:

1. Proof of Identity – Please provide us with a photographic proof of your identity, which can be one of:

Passport (photo page only)
UK/EU Driver’s License (front and back images, which must incorporate your photo)
UK/EU National Identity Card (front and back images, which must incorporate your photo)

The document provided will need to be valid (not expired), original (no photocopies), unedited and showing all four corners.

2. Source of Funds – Please let us know how you are funding your WorldRemit transactions, by providing at least one of the following:

Bank statement in your name showing a salary payment to you
Evidence of savings (or other incomes) supporting your transactions
Loan Agreement Document with evidence of loan being paid

The documentation provided must show how you have funded the transactions you are sending through WorldRemit. Any documents you provide must be dated within the past three months, complete, unedited and will need to clearly show your current residential address.

3. Additional Details – Please can you also confirm the following information:

Occupation and Employer - Please state your job title and employer name.
Purpose of Transactions - Please confirm the reason for sending your transactions.
Intended Use of WorldRemit - Please provide an estimate of how much you are planning to send via WorldRemit within the next 12 months.

Please provide the above details by replying to this email.


My response to them was that this appeared to be an identity thief's Christmas gift and there was no way I would be sending such data to them. Also, as they don't know me personally what good would a photo be?

I closed the account. Currency Fair, on the other hand, have handled much more for me, both out-going and in-coming, without a hint of concern.

stevensfo
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Re: A bank's right to know

#500586

Postby stevensfo » May 15th, 2022, 3:40 pm

Maroochydore wrote:
stevensfo wrote:freeze your account with no warning until you send yet another photo of your I.D.!

I had a variation of this with sending currency to Australia via World Remit. I normally use Currency Fair but thought I'd give World Remit a go, must have been some advantage but can't remember what.

First couple of transfers went OK but on the third they suddenly sent an e-mail which said:

As a valued customer who has transacted over £11,000, we now need to collect some additional information from you as part of our obligations as a regulated company and, above all, to keep your money safe

Please can you provide us with the following information:

1. Proof of Identity – Please provide us with a photographic proof of your identity, which can be one of:

Passport (photo page only)
UK/EU Driver’s License (front and back images, which must incorporate your photo)
UK/EU National Identity Card (front and back images, which must incorporate your photo)

The document provided will need to be valid (not expired), original (no photocopies), unedited and showing all four corners.

2. Source of Funds – Please let us know how you are funding your WorldRemit transactions, by providing at least one of the following:

Bank statement in your name showing a salary payment to you
Evidence of savings (or other incomes) supporting your transactions
Loan Agreement Document with evidence of loan being paid

The documentation provided must show how you have funded the transactions you are sending through WorldRemit. Any documents you provide must be dated within the past three months, complete, unedited and will need to clearly show your current residential address.

3. Additional Details – Please can you also confirm the following information:

Occupation and Employer - Please state your job title and employer name.
Purpose of Transactions - Please confirm the reason for sending your transactions.
Intended Use of WorldRemit - Please provide an estimate of how much you are planning to send via WorldRemit within the next 12 months.

Please provide the above details by replying to this email.


My response to them was that this appeared to be an identity thief's Christmas gift and there was no way I would be sending such data to them. Also, as they don't know me personally what good would a photo be?

I closed the account. Currency Fair, on the other hand, have handled much more for me, both out-going and in-coming, without a hint of concern.


I have mixed feelings about this. If someone had really got hold of your details and was happily transferring your money to their temporary account in Australia, you wouldn't have been too pleased.

On the other hand, I agree that they didn't need to ask for so much info and it would have rung alarm bells for me as well. PSS (Privacy, Safety, Security) has to be observed at all times!

I've had similar requests, but simply received instructions to send a photo of my ID AND a selfie of me holding the ID. That seems to solve the problem.

Steve


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