HSBC Stops Barring Customers From Large Withdrawals Without Explanation

Monday, 27 Jan 2014 12:42 PM

By Dan Weil

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HSBC has rescinded a policy it began in November that wouldn't let clients make withdrawals of 5,000 to 10,000 pounds ($8,288 to $16,576) without providing proof of what they were doing with the money.

The bank didn't inform customers when it originated the policy.

BBC cited the saga of one of the policy's victims, Stephen Cotton. He visited his local HSBC branch this month to withdraw 7,000 pounds from his instant access savings account to repay a loan from his mother.

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A year before, he took out a bigger chunk with no difficulty.

But this time, "when we presented them with the withdrawal slip, they declined to give us the money, because we could not provide them with a satisfactory explanation for what the money was for," Cotton told BBC Radio 4's "Money Box" program. "They wanted a letter from the person involved."

HSBC issued a statement reversing its policy Jan. 25.

According to the BBC, the bank said, "Following feedback, we are immediately updating guidance to our customer facing staff to reiterate that it is not mandatory for customers to provide documentary evidence for large cash withdrawals." The bank said the policy was meant to protect its customers and prevent crime.

Cotton wasn't too pleased with how he was treated. "I've been banking in that bank for 28 years," he said. "They all know me in there. You shouldn't have to explain to your bank why you want that money. It's not theirs, it's yours."

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