WEALTH

ABRUPT ACCOUNT CLOSURES AREN’T JUST VICTIMISING RETAIL CUSTOMERS, WRITES PETER GUY. HIGH-NET-WORTH CLIENTS AND THEIR FAMILY BUSINESSES ARE ALSO FACING GREATER SCRUTINY FROM BANKS

Brought to account

In 25 years of exile, I’ve never had a frozen account, either in Switzerland or elsewhere in the world,” said the late dictator of 0aiti 2ean +la]de ¹*aJy ,ocº ,]^alier aNter AEeeinO to tPe .rencP :i^iera 6o matter Pow di ٻ c]lt it is Nor e^eryone else to access and retain JanSinO ser^ices rest ass]red tPat millionaire despots and tPeir JanSers are sPamelessly oJli^io]s to reO]lations

0owe^er increasinOly strict and arJitrary financial reO]lations since tPe OloJal financial crisis Pa^e prod]ced Snow yo]r client ¹3A+º and anti money la]nderinO ¹)54º policies so strict and m]rSy tPat JanS c]stomers and tPeir relationsPip manaOers ne^er really know where they stand.

)Jr]pt JanS acco]nt clos]res aren¼t merely confined to yo]r a^eraOe retail c]stomer 0iOP net wortP clients and tPeir Namily businesses and assets continue to face more scrutiny from banks’ compliance in^estiOators ;eparate teams cond]ct d]e diliOence on client JacSOro]nds and on JoardinO applications Jeca]se tPe relationsPip manaOer is too emotionally and commercially in^ested to c]t o ٺ l]crati^e clients )nd little to no e`planation will Je

Oi^en Jeca]se JanSs seeS to a^oid arO]ments or laws]its Nrom disOr]ntled clients

PoldinO on to yo]r acco]nt and access to financial ser^ices ?Pen NacinO tPe spectre oN anotPer /reat ,epression or ,arS )Oes tPe last tPinO anyone needs is Nor tPeir JanS to send tPem a pPleOmatic letter anno]ncinO ser^ices Pa^e Jeen witPdrawn and tPey need to find anotPer pri^ate JanS to open tPeir acco]nt

)nd access to JanSinO ser^ices s]cP as tPe aJility to mortOaOe assets as a way to con^ert fi`ed assets into casP is tPe startinO point Nor acPie^inO liY]idity

6o amo]nt oN leOal action will Je aJle to rectiNy or reverse a closed account. No statute or common law entitles indi^id]als and companies to JanSinO ser^ices 1t¼s not a riOPt 1n a diOital financial economy an indi^id]al can’t exist or function without a bank account or credit card Ao] co]ld Je releOated to JeinO a non person

ٺ]s erinO tPe same Nate oN millions oN miOrant worSers wPo Pa^e no access to financial ser^ices

1t¼s a case oN R]dicial o^erreacP wPere too many sPiNtinO and arbitrary laws and rules create traps for unwary and law aJidinO citibens easily t]rninO tPem into s]spected criminals Faced with such personal liabilities, it’s much easier for bank manaOers and financial ad^isors to Rettison clients ratPer tPan fiOPt an ]pPill Jattle witP J]rdensome reO]lations

)nd tPose cParOed witP money la]nderinO will no lonOer Je aJsol^ed witP only fines 1nstead tPey Nace cParOes so onero]s and lawyers wPo cParOe so m]cP tPat it can Je cPeaper to plead O]ilty

*anSs are rel]ctant to talS aJo]t tPe process oN SicSinO o]t clients wPo don¼t meet tPeir cPanOinO internal standards *]t tPey Pa^e no cPoice Jeca]se reO]lators Pa^e sPown no rel]ctance in le^yinO record settinO fines Nor NailinO to detect and control money la]nderinO and suspicious transactions, which is usually a part of a predicate o ٺ ence s]cP as ta` e^asion

:eO]lators Pa^e inAEicted Jillion dollar fines on JanSs and pri^ate JanSs Nor money la]nderinO

Banks will never announce what kind of business or wealthmanaOement acco]nts tPey¼re tryinO to root o]t as tPat wo]ld represent public-relations suicide. Instead, one only hears rumours of tPe acco]nts oN diamond JroSers or art dealers JeinO closed Jeca]se JanS compliance analysis Pas determined a relati^ely PiOP cPance oN money la]nderinO occ]rrinO in tPat area

0iOP net wortP clients are especially ^]lneraJle as tPeir in^estment and business activities can be more complicated. Banks demand a detailed history of the client’s source of money, assets and business JacSOro]nd )nd it doesn¼t end aNter JeinO onJoarded to a pri^ate JanS :eO]lar ]pdates are reY]ired

=ltra PiOP net wortP clients Pa^e complained to me tPat c]rrent reO]lations create ]nreasonaJle delays in settinO ]p JanSinO ser^ices Nor o ٺ sPore companies JeinO ]sed as PoldinO companies

.r]strated pri^ate JanSers e`plain to me tPat reO]lators increasinOly demand tPat JanSs OatPer more Oran]lar inNormation aJo]t e^ery client 7ne relationsPip manaOer said tPat one oN Pis clients succinctly declared her main source of income was “two divorces”. There was little more to add to the report. Then, an

)sian client co]ldn¼t prod]ce or reprod]ce tPe doc]mentation needed to prove that his family business was funded by a personal loan from his uncle, because family members don’t enter into written aOreements witP eacP otPer

1t¼s not Snown wPetPer or not JanSs plan to s]spend tPe c]llinO oN client acco]nts d]rinO tPe pandemic *]t today¼s ]ncertainties maSe it more important tPan e^er to PanO on to yo]r acco]nts