We are a small private company trading in South America.
HSBC, in order to comply with the money laundering and drugs legislation, required information on the company directors and shareholders. Months ago, the bank contacted us for this, saying it had lost all the details we supplied some three years previously. We have held an account with HSBC for some 20 years.
I answered a long questionnaire following the threatening letter that, if I did not phone the bank, the account would be blocked or terminated. We had to make a telephone booking. Date and time were set but HSBC did not call.
You recall that this failure to call as arranged was repeated twice. When the bank did get back to you, the answers about this US$ account were completed.
After that, all went quiet for three more months until you had another threatening letter saying, if you did not answer the questions again, action would be taken on the account. At one stage you had asked if the questions could be sent by email and were told they couldn’t be. Now, though, it suggested it sent an email.
The bank required notarised passports of the directors and shareholders and proof of residence. They live in Peru, Venezuela and Miami. Receipt of this information was confirmed. Even so, on the day you wrote to me, the account was blocked.
You could not pay out foreign currency, something which you needed to do for the business. You were now told that the bank’s inquiries were ongoing and it was compelled to do this. Your questions were unanswered. Eleven days after I approached HSBC, your account was unblocked and you had access to your funds again.
HSBC said: “As part of our efforts to stop financial crime, we are conducting detailed reviews of the information we hold about our customers.
“We apologise for the inconvenience this can cause, but if we don’t receive all the information we need from a business customer, we may be forced to restrict their ability to make foreign currency payments until we are able to complete their review.”
This statement leaves some distance between what you and the bank are saying. The impression I have though is that both the business side and indeed the retail arm of HSBC need to brush up their acts regarding these identification demands.
Certainly, if there are deemed to be any omissions the bank should not wait for three months to come back saying it hadn’t got all it wanted.