Comment by do_not_redeem
1 year ago
That blog has a lot of choice quotes along the same lines. Another favorite:
https://www.bitsaboutmoney.com/archive/money-laundering-and-...
> This [KYC/AML] will affect the typical user of the financial system precisely zero times during their lives.
I've been affected by this nonsense, and so have friends and family. Quite inconvenient when you're trying to buy a house and trying to keep things moving on time. I may not be "typical" but my mother certainly is. I can tell that patio11 is highly invested in the finance industry, not wanting to burn bridges, and I think he is incentivized to try to make people believe that KYC is beneficial and highly effective, but it's just not the case. It reminds me of the people inside Google working on their auto-banning systems who won't admit that it doesn't always work perfectly.
Per the article:
"Debanking will also not infrequently swiftly cascade to accounts in the same household, regardless of title (non-specialists can round this to “name on the account”; industry can’t). Banks institutionally consider those accounts in the same household to be highly likely to be under common control, regardless of what paperwork, account holders, or politically influential subcultures believe."
My parents live 1000 miles away and we haven't been in the same household for 20 years. Either our troubles were independent and uncorrelated events, or banks are crawling through people's family trees like they're 23andMe. Maybe my cousin who I haven't seen since we were kids did something shady and tainted our whole family tree in the eyes of the banks, who knows anymore.
> or banks are crawling through people's family trees
I work in securities. Our KYC screens aren’t as sophisticated as the banks’. We absolutely see family relations. (They’re typically gleaned from public records and social media. It's unfortunately not uncommon for kids to open accounts in parents' names and vice versa, even after a long time.)
3 replies →
Of course they are crawling through people's family trees. They have no idea who talks to who, but see formal relationships.
Same here. I think one must be occupying very nice couch in a nice house in a 1-tier country to say that AML/KYC doesn't affect 'typical' users
If people have actually read the article, they will have spotted the bits where patio11 himself has been adversely affected by this at least twice!
> I think he is incentivized to try to make people believe that KYC is beneficial and highly effective
I don't think the article is arguing that at all. It's describing the "system", not endorsing it (and explicitly complaining about it in several places).
If nothing else having to do more paperwork is very common.
British banks tend to not open accounts for people abroad because of the cost of KYC, and they even close accounts if you move abroad. Difficult if you have assets or a pension in the UK but live abroad. As you say, it makes it very hard for people who move around.
There are definitely political biases in closing bank accounts in the UK, and many cases of accounts being closed because banks did not like someone's politics. Not even fringe political views, associations with the previous government's part has caused problems in some cases, and definitely association with smaller but significant parties.
People also avoid taking on jobs that might make them "politically exposed persons" because the rules are too broad, and that (although it affects only a few people) does a great deal of damage because it reduces the number of people from outside in organisations, which worsens governance and corruption.
> If nothing else having to do more paperwork is very common. British banks tend to not open accounts for people abroad because of the cost of KYC, and they even close accounts if you move abroad.
How are their so many non-dom retirees if that's the case? They have to have some sort of income.
As patio11 made abundantly clear in his article, banks are not homogeneous in their preferred customers, their ability to serve specific needs or their tolerance for risk. It may well be true that some banks don't like non-resident customers, but many banks offer products specifically tailored for these customers.
https://www.expat.hsbc.com/international-banking/products/ba...
https://www.santanderinternational.co.uk/international/produ...
1 reply →
The term "non-dom" usually means foreigners in the UK making use of the tax dodge. In that case, British banks are happy to open accounts for them, especially as they are rich.
Some accounts will be opened for other foreigners in the UK - sometimes the "basic" accounts .
Lots of British people who have retired abroad on more modest incomes have had their accounts closed: https://www.telegraph.co.uk/money/banking/barclays-to-debank...