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Lawyer here. Every time I have a new client I have to obtain picture ID, check their share registers etc. Doesn't matter that most of my clients are entrepreneu
by flexie 13y ago
Lawyer here. Every time I have a new client I have to obtain picture ID, check their share registers etc. Doesn't matter that most of my clients are entrepreneurs, startups or venture funds. Doesn't matter that all their transactions go through banks that have already checked the transactions and the people involved once and that all transactions are ultimately registered in public registers such as the commerce register.
If I were suspecting that a client's transaction was part of some tax evasion scheme, European Union law would require me to report it to the authorities (although it's not clear that these requirements are in themselves lawful).
All this nonsense costs lots of time and money for me and ultimately for my clients.
Meanwhile, it turns out that the scumbags who actually launder money, do it more or less out in the open and they are not even put to jail.
- midas007 13y agoThis story underscores that anything goes if you get big enough.
- jzwinck 13y agoAs an individual, all these "know your customer" and "anti-money laundering" laws are a massive drag. When I moved to the UK it was nearly impossible to open a personal account (despite already having secured the right to work from the government--which vetting is quite substantial). The bank wanted utility bills with my residential address, but clearly I needed a bank account to get a home and utilities. It took four visits to the bank branch to get this sorted, each time resulting in more excuses about how they couldn't help because of KYC, AML, and CYA. If they want to fight money laundering, fine, give me an account with a minimal cash flow limit or some other restrictions. But the modern regulatory regime has infected retail banking to such a degree that normal humans with good jobs can no longer open an account at all. Clearly professional criminals continue to work the system just fine, meanwhile.
- slashdotaccount 13y agoThat's why cryptocurrencies are so good. Nobody can deny you when creating an account or moving your money.
- jzwinck 13y agoHow would that have helped me pay my electric bill? I mean sure, if the electric company wanted to support it, OK, but they'd sooner support credit cards or PayPal, don't you think?
- slashdotaccount 13y agoI mean, the perspective. I don't like this system when you need a bank account to get a home and utilities. Why can't you use cash? I don't like that the bank wanted your utility bills with your residential address just to create an account for you. What for? They want to control everything. I just don't like that.
- bruceboughton 13y agoYou can just use cash if you have a key meter like millions of people in the UK. You don't need an account.
- makomk 13y agoYou'll pay a hefty premium for that though - it's just one of the ways life is more expensive for the poor than for the wealthy.
- aestra 13y agoI don't need a bank account for utilities in the US. The easiest way to pay is by check my mail or credit card online but if you did not have a bank account you can pay in person or get a money order or maybe even a prepaid debit card?
- waps 13y agoNote that the law requires that all debts, public and private, can be settled using legal tender (ie. cash). In practice this is mostly implemented by demanding the person pay cash at a post office. You do not need a bank account to pay for utilities in the US. I'm not saying not having one will be very pleasant though.
- greghinch 13y agoAs someone who just went through this, an FYI for anyone else in this situation: Lloyds Bank will let you open a current account with just a US passport and a UK work visa, no other docs needed. HSBC has a similar account you can get, but, well, see parent story...
- mseebach 13y agoEven Lloyds is hit and miss. A general strategy that seems to work is to gather as much documentation as you can (work contract, flat lease, any government paperwork, something that documents your address and status where you come from, anything with the address you live at, even if it doesn't have your name on it etc) and hit the main street banks from one end, eventually one will bite. Don't worry which one you get, you can easily change it later - all you need is for any bank to send you a statement.
- greghinch 13y agoI was actually at my 3rd bank trying to open an account, but without any other documentation than my passport & visa. I think it was Halifax. The guy I was speaking went in back for a bit, and per usual said "I'm sorry but without proof of address we can't open an account for you." When I started lamenting my sense of defeat to him about UK banks, he said "okay look, I'm not supposed to say this, but off the record, if you go down the street to Lloyds, they have a special process for US citizens where you can just open an account with a passport." Sure enough I went down the road, and after making yet another appointment (an appointment to open a bank account? really Britain…), they confirmed that indeed they do open accounts for US citizens with just a passport. So I feel pretty confident in recommending Lloyds in this case.
- mseebach 13y agoLloyds is probably better than average since at least at some point they had a formal process for getting an account without proof of address. But my wife was asked for proof of address there (which she was able to provide) and my friend failed to get an account , but got one at Halifax. I have a few more secondhand anecdotes about other people who was turned away at Lloyds, but taken on at Barclay or HSBC. I think the case is that it's a rather non-deterministic process and the outcome depends a lot on exactly which manager you talk to and what their mood is like that day.
- jotm 13y agoYou need to prove where you lived for the last 3 years. Oh, you don't have paper bills? Your country is very progressive, too bad. Moved around? Well, you need a UK address or at least a rental agreement. Also showing your current bank account statements will help. But we'd rather refuse to open this simple checking account just because (...we're busy laundering money :-)...). And no one gives you the exact goddamn reason or a simple solution.
- mjblack 13y agoPaperless billing still has a bill that you can print out, it just means that you wont be mailed a statement every month.
- michaelt 13y agoDocuments produced on a home printer are meaningless for identity or address verification. Anyone can open the PDF in inkscape and make it say any name, address or date they like. Isn't it more fraudulent to give the bank home-made documents than to give them nothing? At least when you give then nothing you're being honest about what you're giving them.
- arjie 13y agoYeah, but that modification is forgery and fraud. In all honesty, I could probably replicate a paper bank statement by doing the same thing. The crime is in the manipulation. As for me, I continue to print out bank statements on university printers and have everyone from embassies to landlords accept them. No one I've met believes that going to your bank's website and printing out the PDF they give you is fraudulent.
- thisone 13y agoI was on the phone to British Gas complaining that I suddenly stopped receiving paper statements. The agent on the phone got really helpful all of a sudden when I told him I needed the paper bills for proof of identity. Turns out he had just gone through the whole debacle himself. He had to show a bank statement, but he only has an online account. Went to the bank to get a statement printed and stamped, and whoever he went to turn it in to still refused it because it hadn't been mailed. Personally, I don't want to give the BA any easy reason to reject my visa applications, I get all the mailed proof of address I can.
- lgeek 13y agoYou don't really need a bank account to rent a home. In fact, at my first place I've only paid rent with cash or by debit card for almost one year, and it was an agency. Private landlords tend to be even more flexible, basically the ones I've had only cared about being paid on time, not how.
- walshemj 13y agoYeah its bizarre I had to jump through hoops in the UK to open a new ISA account (tax free savings) even if I am a customer of the bank all ready. Its not like I turn up with with 50k in 500 euro bills and want to open an account that day.
- memracom 13y agoWhen I did this I got a letter from my employer and then took that to the same branch of the same bank where my employer did their banking. It worked.
- bowlofpetunias 13y agoJust a nitpick: there is really no such thing as "EU law". EU directives bind nations and force them to implement them in the local context, but any law you are bound to is the local law. (The distinction is important in the current political climate, since the excuse "it's EU law" is abused by politicians to steamroll the local electorate into believing they have no say in the matter, and pretend they can not be challenged locally. That's how we got screwed with for instance data retention "laws" that are blatantly unconstitutional in several EU member states.)
- rmc 13y ago(a) There are "EU Regulation" which are actual laws. But "Directives" are more common. (b) Regardless, an EU Directive is essentially an "EU law". It's a distinction without much of a difference. (c) Some countries' constitutions say "All EU law/directives/whatever are binding and constitutional, unless the country leaves the EU". The Irish constitution has this sort of clause. (d) EU law/directives/regulation is created by the EU. Which we vote on. European Parliament elections are coming up in 2014. If you think you have no say in the EU, vote in the EP elections and vote in your national elections. Those 2 directly elected bodies control EU law.
- flexie 13y agoEU law is a term used for all regulation from the EU and sometimes for EU court rulings as well. Most EU legislation is issued as "directives" (such as the EU directive on money laundering), which are to be implemented by the member states in their local laws, or "regulations", which apply directly without any need for national implementation. Now, this distinction is blurred by the fact that directives also have direct effects in certain situations (so that the provisions of the directive can be invoked even if they are not implementer), for example when a member state fails to implement it on time or correctly.
- stef25 13y agoSo you can't have a client who's illegally in the country, like asylum seekers, or any ID will do fine? I always thought defending someone in court was like being a doctor, you should help them no matter what.
- legutierr 13y agoAs a lawyer you are required to report on your clients? Whatever happened to attorney-client privilege? Does that not exist in your jurisdiction?
- waps 13y agoLawyers are not priests, nor doctors. You are misunderstanding what it means. Attorney-client privilege (in theory) only lasts up to the point where the attorney is sure that something is illegal. If that line is crossed, there is a theoretical reporting requirement (that is not specific to lawyers). A lawyer most certainly does not have the duty to hide the crimes or confessions of his client(s). Not in the EU, not in the US (nor does a priest or doctor, but they can legally choose to do so in most jurisdictions. Anyone who is not a priest or doctor cannot make this choice : you have to report. In practice I've never seen anyone get sued for not reporting anything outside of financials). Now as for the interpretation of this ... You have the US way (it's not illegal until a court says it is ... there's something to be said for that), and the EU way. The problem in the EU is that a lot of tax collection agencies are less than subtle and have legal rights that mean you simply don't want to even appear to cross them. In Western Europe, a tax agent has the right to shut down any business without specifying a reason, lock any account without specifying a reason, and take anything from any premise without a reason (or lock it down). Does this violate the relevant constitutions ? Nobody's successfully challenged it as far as I know. (Yet another reason EU criticism of NSA data collection is ridiculously hypocritical). That doesn't change the basic principle though. If you go to a lawyer saying "I killed this guy, get me out of it", he may go to the police and report you. While the lawyer is unlikely to get sued for not warning the police, when asked a lawyer MUST testify that this has indeed happened (same thing applies to anyone else for that matter).
- stdbrouw 13y agoEhm, you're being pretty vague here. As far as I can tell, none of what you're saying applies to Belgium, a Western European country if any is, and our tax collection agency is not even close to the IRS when it comes to bullying people and businesses. And the European Union really has very little say over tax collection practices, so I imagine it's different everywhere. So what countries and what practices are you talking about exactly?
- chmars 13y agoWhich EU regulations are applicable? I'm asking because I work with lawyers in the EU from time to time and I've never had to provide ID etc. It was always a telephone call or email plus sometimes a retainer.
- cynicalkane 13y agoThe regulatory environment HSBC is operating in is more or less the regulatory environment you're complaining about. The law requires HSBC to monitor billions of wire transfers, to breathe down the neck of suspicious persons using their banks, and monitor all of its branches for criminal activity, and they basically did that--but not as much as the US demanded. You don't send an executive to jail because a guy several layers down did something wrong, and popular outrage feels the executive should, somehow, be personally and criminally responsible for that. The idea that HSBC executives are guilty of... violating the article author's feelings about how anti-drug law should work, or something... is why you don't get your financial news from an unbalanced liar in Rolling Stone magazine. But even Taibbi can't seem to identify what precisely the executives are guilty of, an important prerequisite to prosecution in a nation governed by the rule of law. As for the regulations, they are the reason why you can't open an account or move large amounts of money without giving the bank enough information to know a substantial portion of your entire financial history, and giving the bank permission to freeze your accounts approximately whenever they feel like it or whenever the government demands. You can think this is a good thing or a bad thing, but since you, Mr. Lawyer, complain about you having to burden yourself with the responsibility of knowing your client, surely you feel it's unfair that banks have to do the same thing? Not to mention the privacy implications.
- justincormack 13y agoAnd the law makes the executives responsible for implementation of this, which they clearly did not do effectively. The executives are not guilty of an anti-drug law, but a money laundering law, and the liability is pretty clear. The current maximum sentence is 5 years, although the "Holding Individuals Accountable and Deterring Money Laundering Act" is trying to raise this to 20. All these types of regulation about money laundering and bribery have executive liability.
- cynicalkane 13y agoPlease point me to the law that the executives broke that would send them to jail. Cross-reference it with the government's charges. If you read the DOJ's side of things, HSBC is guilty of things like "we said Mexico is high-risk, HSBC disagreed and so failed to automatically monitor a bunch of transactions," in more legalistic language.
- larrys 13y ago"All this nonsense costs lots of time and money for me and ultimately for my clients." Perhaps you could clarify how it costs both your clients money and you money as well? I'm assuming you are billing your clients for the work that is necessarily in one way or another for having to do this. Or it's part of your overhead and you base your rates in part on your overhead. For sure it's a pain but there are many things that need to be done in order to be in business. They are necessary evils like filing tax returns or collecting social security numbers and making employees fill out various government required employment forms. It's called "the cost of doing business". Little minor bs that isn't anywhere close to going away.