Personal Finance

Bank is closing my account for no reason

  • Last Updated:
  • Oct 18th, 2020 8:53 pm
Deal Fanatic
Apr 16, 2007
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Financial District B…
Poutinesauce wrote: Tell me Mikey of a single good reason why banks should be allowed to harm people's financial lives....

...a company like Equifax is allowed to lord over the personal data and financial future of hundreds of millions of people against their will.
Wow you still don't get it do you? You're as bad as Wayne where you can't understand that Equifax and Trans Union are nothing more than posting portals for data furnishers to report financial payment performance data. EQ is NOT to blame for your poor credit. The bank you defaulted on is the entity that reports your delinquent behaviours.
If you want to keep on with that "credit bureaus are parasites and ruins people lives" then go on right ahead. No one is listening.


If you were found guilty of a moving violation, impaired driving, speeding and a reportable accident I bet you would probably blame the Province of Ontario and Service Ontario for supplying a Drivers Abstract to any insurer you apply for auto insurance. They are the ones that cause those super high premium rates and is ruining your life.
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Aug 29, 2012
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mikeymike1 wrote: Wow you still don't get it do you? You're as bad as Wayne where you can't understand that Equifax and Trans Union are nothing more than posting portals for data furnishers to report financial payment performance data. EQ is NOT to blame for your poor credit. The bank you defaulted on is the entity that reports your delinquent behaviours.
If you want to keep on with that "credit bureaus are parasites and ruins people lives" then go on right ahead. No one is listening.


If you were found guilty of a moving violation, impaired driving, speeding and a reportable accident I bet you would probably blame the Province of Ontario and Service Ontario for supplying a Drivers Abstract to any insurer you apply for auto insurance. They are the ones that cause those super high premium rates and is ruining your life.
My credit score is in the mid to high 700s on those bureaus, so that is not what bothers me. What does bother me is that the system is overseen by two for profit corporations that makes a fortune every year of selling access to people's data against their will, as they have no choice to be involved with a for profit corporation that will sell their financial data if they want to partake in modern society.

There is absolutely no reason why the government is not the one handling this, with actual due process and accountability, as is the norm in most industrialized countries. The current system is literally a holdover from the Far West era.
Deal Addict
May 12, 2014
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Montreal
mikeymike1 wrote: No it will not be an unequivocal yes ...
Furthermore, I'm not sure I would say one case supersedes all other cases ...
The end result is they will get a heavily redacted summation ...
The answer is indeed an unequivocal yes. The judgement made that rather clear. You can show this to your bank's legal department if you need further clarification.

And yes, an appellate case controls and supercedes previous lower level cases. That's how the legal system works in Canada. In this case by the way, they didn't throw out your previous credit score case they just said it wasn't really applicable.

And finally the judgement made clear what the bank was allowed to redact, and what they must not redact.

Bottom line: a PIPEDA request is highly likely (but not certain) to get some or many (but not all) useful documents which will very probably (but not certainly) let the client know why he was dumped.

Oh and it's almost free in time, effort and money, and without risk to the client. And if the bank refuses now that there is clear caselaw on it, damages may indeed be awarded next time. Case closed.
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Jan 27, 2004
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you guys are making it too complicated.
Making it seem like the banks are doing this just for fun and to increase profits.
its anti money laundering and terrorist financing regulations. This is mandated by the government. Its also mandated by all the world governments in a way... Its a a geopolitical thing. IT helps us maintain the integrity of our banking systems and economy.

The penalties are huge... even just for mere exposure to AML.

here is a bank that got fined $1.3 billion
https://www.abc.net.au/news/2020-09-24/ ... d/12696746

this fine is in CAnada... not even for something as basic/blatant as letting a drug dealer have their bank accounts there. but JUST FOR REPORTING IT INCORRECTLY.
https://www.cbc.ca/news/business/fintra ... -1.3999156
CBC News sources confirmed the case involves Manulife Bank and its failure to report 1,174 international electronic money transfers, 45 cash transactions involving at least $10,000 each, as well as one suspicious transaction.
Thats a tiny bit of transactions for a huge fine .
thats just reporting. These transactions might not have led to anything illegal either.
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May 12, 2014
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UrbanPoet wrote: Making it seem like the banks are doing this just for fun and to increase profits.
I know that the banks have unfortunately been transformed, unwillingly, into agents of the state. It's not their fault.

I also know that they're not allowed to reveal if they file a SAR.

But they are allowed to say why they're terminating their relationship with you. And it seems to me to be basic due process that they would let you know why, and give you a chance to set the record straight.
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Jun 19, 2001
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I would say the troll is back making thread like this, and this help-td-locked-my-account-2411082/, and 65 replies it is working. Oh and this one too tangerine-bank-refused-my-bank-account- ... n-2410968/


MoF125 [OP]
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Oct 13, 2020
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Last edited by zoro69 on Oct 18th, 2020 6:01 pm, edited 2 times in total.
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Apr 16, 2007
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Financial District B…
UrbanPoet wrote: its anti money laundering and terrorist financing regulations. This is mandated by the government. Its also mandated by all the world governments in a way... Its a a geopolitical thing. IT helps us maintain the integrity of our banking systems and economy.
We just went through extensive review and training about how to identify and report suspicious transactions and how to report them.
If a client walks up to the teller and makes a deposit then asks how does FINTRAC work or what does it do the teller is mandated to report that person for asking that question. Many such behaviours are grounds for account cancelation.
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Aug 1, 2006
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Toronto
UrbanPoet wrote: you guys are making it too complicated.
Making it seem like the banks are doing this just for fun and to increase profits.
its anti money laundering and terrorist financing regulations. This is mandated by the government. Its also mandated by all the world governments in a way... Its a a geopolitical thing. IT helps us maintain the integrity of our banking systems and economy.

The penalties are huge... even just for mere exposure to AML.

here is a bank that got fined $1.3 billion
https://www.abc.net.au/news/2020-09-24/ ... d/12696746

this fine is in CAnada... not even for something as basic/blatant as letting a drug dealer have their bank accounts there. but JUST FOR REPORTING IT INCORRECTLY.
https://www.cbc.ca/news/business/fintra ... -1.3999156



Thats a tiny bit of transactions for a huge fine .
thats just reporting. These transactions might not have led to anything illegal either.
Some FIs , especially strictly digital ones like Revolut, Transferwise, and others are implementing faulty AML algorithms which are freezing people's accounts for trivial reasons. They insist they can't tell you why your account is frozen, but often they hold your money for quite a long time while they do their investigation. Unfortunately, some people keep all their money in that one digital bank, and their lives are drastically upended while they have no access to their own money. In Canada there is absolutely no official body to complain to, besides the bank's Ombudsman or a financial industry Ombudsman, so you are actually better off dealing with a FI who is regulated in a different country. At least UK and USA have official bodies who can help you get your money back.

The solution is to not hold your money with one FI. Have at least a couple months' worth of money at a different FI.
Deal Addict
May 15, 2013
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Alberta
UrbanPoet wrote:
its anti money laundering and terrorist financing regulations. This is mandated by the government. Its also mandated by all the world governments in a way... Its a a geopolitical thing. IT helps us maintain the integrity of our banking systems and economy.
If that is true, then why when they close someone's account the information is not shared with other financial institutions?
If they already have the information about someone who may be laundering money and deserve his account to be closed, why not share that data with the rest of the system to "maintain its integrity"?
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Mar 21, 2010
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iamthebest wrote: If that is true, then why when they close someone's account the information is not shared with other financial institutions?
If they already have the information about someone who may be laundering money and deserve his account to be closed, why not share that data with the rest of the system to "maintain its integrity"?
Because, privacy issues aside, individual banks don't care about that, they care about not getting fined. Most of the global banks for the super wealthy built their books of business through "discretion", i.e. looking the other way. Their culture is to close one eye and definitely not to help any of their competitors. In fact, compliance teams don't want your other banks to close your account because it increases the risk that you flip out at them if you can't get another account. This is one of the reasons why money laundering laws and regulations are so draconian, because the banks definitely aren't going to pitch in and collaborate and try their hardest to stop criminals using the banking system by themselves.

Second part of the answer is that it wouldn't really help much, because banks can rarely, if ever, "prove" that the money comes from crime. All they do is have a list of things they don't tolerate or that increase their perceived risk of having you as a customer. Some banks will get rid of you for things like using your bank account to make crypto trades, gambling, receiving money from countries they don't like. Each bank has their own things they look out for and a different level of risk that they will tolerate. So unless they literally share your entire customer file and all their reasoning - which will never happen - it's not really very useful to other banks. Bank A may be perfectly happy to serve customers that Bank B won't touch. Bank C may not really want that customer but is willing to close one eye if the customer has a butt ton of investments with them. It's not a clean cut thing at all.
Last edited by Manatus on Oct 18th, 2020 4:37 pm, edited 1 time in total.
Deal Addict
May 15, 2013
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Alberta
Manatus wrote: Because, privacy issues aside, individual banks don't care about that, they care about not getting fined. Most of the global banks for the super wealthy built their books of business through "discretion", i.e. looking the other way. Their culture is to close one eye and definitely not to help any of their competitors. In fact, compliance teams don't want your other banks to close your account because it increases the risk that you flip out at them if you can't get another account. This is one of the reasons why money laundering laws and regulations are so draconian, because the banks definitely aren't going to pitch in and collaborate and try their hardest to stop criminals using the banking system by themselves.
Perfect, then the Government can easily obligate Banks to share that info. So by law, they HAVE to do it or they are fined too.
What is the logic of fighting against laundering if they close my account in one Bank and I keep laundering money through the other Banks?
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Mar 21, 2010
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iamthebest wrote: Perfect, then the Government can easily obligate Banks to share that info. So by law, they HAVE to do it or they are fined too.
What is the logic of fighting against laundering if they close my account in one Bank and I keep laundering money through the other Banks?
One of the issues is security - i.e. if banks are sending everything they know about you to a bunch of other banks, holy smokes that could end badly. Like if you thought the Equifax leak was bad. And don't forget these aren't people who have been accused or convicted of any crime. There are parts of the world (I think Singapore is one) where banks are exploring using blockchain in order to do things like this (more) securely, I think.
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Jan 27, 2004
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iamthebest wrote: If that is true, then why when they close someone's account the information is not shared with other financial institutions?
If they already have the information about someone who may be laundering money and deserve his account to be closed, why not share that data with the rest of the system to "maintain its integrity"?
Red tape. Privacy laws. Info you collect, you must protect. You can’t just give Away info .
Deal Addict
May 15, 2013
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UrbanPoet wrote: Red tape. Privacy laws. Info you collect, you must protect. You can’t just give Away info .
They can share that info with FINTRAC (they do it anyways all the time) and FINTRAC can then share the filtered info with the rest of the financial system.
Deal Addict
May 15, 2013
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Manatus wrote: One of the issues is security - i.e. if banks are sending everything they know about you to a bunch of other banks, holy smokes that could end badly. Like if you thought the Equifax leak was bad. And don't forget these aren't people who have been accused or convicted of any crime. There are parts of the world (I think Singapore is one) where banks are exploring using blockchain in order to do things like this (more) securely, I think.
Not anyone, just FINTRAC.
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Mar 21, 2010
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iamthebest wrote: Not anyone, just FINTRAC.
That's already done with STRs, no? They send FINTRAC a bunch of information and FINTRAC can ask for more. It's pretty unlikely that a bank would close an account for strict ML/TF reasons (as opposed to business risk reasons) without filing an STR. Similarly once a bank files an STR on someone, they're automatically a high risk customer and almost certainly considered for exit.

I suppose the issue (in addition to tipping off concerns that if you tell more people, there's a higher chance it will leak) is that the bar for filing an STR is actually very low. All it requires is a "suspicion" that a crime may have been committed, not any form of evidence or proof. Suspicion could be anything from "buddy there gambles a lot of money for a garbage truck driver". Most banks file a lot of defensive STRs to protect themselves, i.e. they file on everyone who could potentially be a problem just so the regulator doesn't turn around and question them for not doing it. I'm not sure if the regulator has enough resources to not only triage and action all/some of these, but also determine which ones meet the bar for disclosure to the reporting sector as a whole.

To put it into perspective, almost 900,000 STRs were filed across Canada between April 2018 and March 2019. Even if it took only an hour to investigate each one (and it takes a while just to read them), it would need 350 people working full time every day of the year to clear them.
Last edited by Manatus on Oct 18th, 2020 8:54 pm, edited 1 time in total.
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Apr 16, 2007
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Manatus wrote: That's already done with STRs, no? They send FINTRAC a bunch of information and FINTRAC can ask for more. It's pretty unlikely that a bank would close an account for strict ML/TF reasons (as opposed to business risk reasons) without filing an STR. Similarly once a bank files an STR on someone, they're automatically a high risk customer and almost certainly considered for exit.

I suppose the issue (in addition to tipping off concerns that if you tell more people, there's a higher chance it will leak) is that the bar for filing an STR is actually very low. All it requires is a "suspicion" that a crime may have been committed, not any form of evidence or proof. Suspicion could be anything from "buddy there gambles a lot of money for a garbage truck driver". Most banks file a lot of defensive STRs to protect themselves, i.e. they file on everyone who could potentially be a problem just so the regulator doesn't turn around and question them for not doing it. I'm not sure if the regulator has enough resources to not only triage and action all/some of these, but also determine which ones meet the bar for disclosure to the reporting sector as a whole.
A total revision was just implemented this summer. We are all going through new qualifying measures right now and we're all trained to recognize and identify suspicious behavior and file a report. STR's have been expanded beyond what anyone knows.
As-like your gambling example, if a persons original acct opening claims his employment is with McDonalds but the person deposits 7k every 2 weeks then there's going to be issues.
Even if you're observed to be fidgety or nervous can trigger a report.
And ones activity does not have to be a bonafide crime. If any money is transferred to known extremists groups your acct may be closed.


While it is not a crime to be on the list, the designation allows law enforcement to go after the finances and assets of the groups. It also becomes an offence to support them financially and prohibits anyone from knowingly participating in or contributing to the activities of listed groups.
https://globalnews.ca/news/5789881/how- ... atch-list/
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