Money frozen due to anti money laundering
Discussion
Close friend has a daughter aged in early 20s. The daughter is being gifted about half the price of an apartment, over £100k, by her mother/my friend.
The money was legitimately obtained from a property sale in mainland China. It was transferred to the UK from a HK account by a popular money transfer service, starting with "R". Lets say it's name is a bit like revolution.... It is a UK money transfer account.
This £100k+ is now frozen, or at least there is a transfer block for AML reasons. Money can still be spent in shops by an ATM card. There has been no written correspondence about this. Trying to move the money online results in transfer to an online chat which goes nowhere.
My friend and her daughter have demonstrated the source of funds to the satisfaction of the daughter's solicitor (apartment will be in her name only). The same proof of funds has been sent to the R-company. This is not enough for the R-company. They have (via online chat) requested more information which is unrelated to the source of funds, i.e. China payslips and tax returns. Irrelevant as the source of funds was sale of a long held property. Since they have been given proof of the source of funds, but want unrelated information, I can see that this will just end in giving them large amounts of personal information and getting nowhere.
Under what law or authority is this money able to be frozen?
What can be done about it?
The money was legitimately obtained from a property sale in mainland China. It was transferred to the UK from a HK account by a popular money transfer service, starting with "R". Lets say it's name is a bit like revolution.... It is a UK money transfer account.
This £100k+ is now frozen, or at least there is a transfer block for AML reasons. Money can still be spent in shops by an ATM card. There has been no written correspondence about this. Trying to move the money online results in transfer to an online chat which goes nowhere.
My friend and her daughter have demonstrated the source of funds to the satisfaction of the daughter's solicitor (apartment will be in her name only). The same proof of funds has been sent to the R-company. This is not enough for the R-company. They have (via online chat) requested more information which is unrelated to the source of funds, i.e. China payslips and tax returns. Irrelevant as the source of funds was sale of a long held property. Since they have been given proof of the source of funds, but want unrelated information, I can see that this will just end in giving them large amounts of personal information and getting nowhere.
Under what law or authority is this money able to be frozen?
What can be done about it?
Plenty of similar stories on Google about the same thing. I’d have thought sending that sort of money would prompt some research beforehand.
As I understand it when a transfer has been frozen due to AML suspicions it is customary for information about the status of the cash to be rather opaque, so as not to “tip off” a suspected money launderer. So there is a good chance that an investigation is ongoing about the funds, but that they will not give much or any concrete information about it.
As I understand it when a transfer has been frozen due to AML suspicions it is customary for information about the status of the cash to be rather opaque, so as not to “tip off” a suspected money launderer. So there is a good chance that an investigation is ongoing about the funds, but that they will not give much or any concrete information about it.
Exactly this. Legally they are obliged to verify the source of funding, and are similarly obliged not to divulge further information, as this can be construed as "tipping off".
It's a massive pain, but play the game and give them all the info they're asking for. There's no way around it.
It's a massive pain, but play the game and give them all the info they're asking for. There's no way around it.
Durzel said:
Plenty of similar stories on Google about the same thing. I’d have thought sending that sort of money would prompt some research beforehand.
As I understand it when a transfer has been frozen due to AML suspicions it is customary for information about the status of the cash to be rather opaque, so as not to “tip off” a suspected money launderer. So there is a good chance that an investigation is ongoing about the funds, but that they will not give much or any concrete information about it.
This - friend is a bit naïve to think transferring £100k cross-border wouldn't trigger an investigation. Unfortunately you just have to go along with it.As I understand it when a transfer has been frozen due to AML suspicions it is customary for information about the status of the cash to be rather opaque, so as not to “tip off” a suspected money launderer. So there is a good chance that an investigation is ongoing about the funds, but that they will not give much or any concrete information about it.
Big Pants said:
Exactly this. Legally they are obliged to verify the source of funding, and are similarly obliged not to divulge further information, as this can be construed as "tipping off".
It's a massive pain, but play the game and give them all the info they're asking for. There's no way around it.
I think the issue is that they are not able to provide all of the information being asked for.It's a massive pain, but play the game and give them all the info they're asking for. There's no way around it.
I have been through similar pain when funds arrived from Australia for a company share sale.
I am no expert, but from my experience, it's not just the specific source of funds that needs to be shown (very easy in my case), but they have to get to understand the wealth of the person and determine that it is "plausible" that they have that wealth.
So as others are saying, go with the flow. It's not nice but I failed completely with all of my "you have no right to know this" protestations and came close to having my accounts frozen. Well I don't know how close, but the threat of that happening was made to me more and more frequently.
Hope it gets resolved ok.
Bert
I am no expert, but from my experience, it's not just the specific source of funds that needs to be shown (very easy in my case), but they have to get to understand the wealth of the person and determine that it is "plausible" that they have that wealth.
So as others are saying, go with the flow. It's not nice but I failed completely with all of my "you have no right to know this" protestations and came close to having my accounts frozen. Well I don't know how close, but the threat of that happening was made to me more and more frequently.
Hope it gets resolved ok.
Bert
bobbysmithy said:
I think the issue is that they are not able to provide all of the information being asked for.
Yes, there is proof of funds. The solicitor has accepted this as complying with AML regulations. They have asked for payslips and tax records which are not the source of funds. They are also in Chinese.
It doesn't matter what the solicitor thinks or says really, regards what the onward purpose of the funds are. The solicitors opinion doesn't trump the AML obligations of the bank/R.
I would suggest that if friend's Mum can't evidence the source of these funds to the satisfaction of the bank/R then its going to remain frozen, or get unwound.
It sounds harsh but the reason they're asking for payslips, tax returns, etc is to try and understand how it is both parties are in a position to transact £100k in cash. I presume this is not a typical transaction for either party, hence the red flags.
I would suggest that if friend's Mum can't evidence the source of these funds to the satisfaction of the bank/R then its going to remain frozen, or get unwound.
It sounds harsh but the reason they're asking for payslips, tax returns, etc is to try and understand how it is both parties are in a position to transact £100k in cash. I presume this is not a typical transaction for either party, hence the red flags.
I had something very similar with one bank moving a little over £50k to another bank in the UK. It was shortly after doing another transfer for more money.
Regardless of them accepting the transaction on the phone and calling me back to confirm, they refused to actually send the money.
Instead I was able to transfer £20k per day so over the course of 3 days transferred all the money to the other bank over faster payments on the assumption that the more money I moved the smaller the issue may be.
Regardless of them accepting the transaction on the phone and calling me back to confirm, they refused to actually send the money.
Instead I was able to transfer £20k per day so over the course of 3 days transferred all the money to the other bank over faster payments on the assumption that the more money I moved the smaller the issue may be.
Iminquarantine said:
bobbysmithy said:
I think the issue is that they are not able to provide all of the information being asked for.
Yes, there is proof of funds. The solicitor has accepted this as complying with AML regulations. They have asked for payslips and tax records which are not the source of funds. They are also in Chinese.
Big Pants said:
Exactly this. Legally they are obliged to verify the source of funding, and are similarly obliged not to divulge further information, as this can be construed as "tipping off".
It's a massive pain, but play the game and give them all the info they're asking for. There's no way around it.
That's exactly the case, where the money is inconsistent with the recipients income. It's a massive pain, but play the game and give them all the info they're asking for. There's no way around it.
Op, all that is required is for your friends Daughter to answer the questions truthfully with what she has got information for, until they get to a position where proof is sufficient, for China.
Iminquarantine said:
bobbysmithy said:
I think the issue is that they are not able to provide all of the information being asked for.
Yes, there is proof of funds. The solicitor has accepted this as complying with AML regulations. They have asked for payslips and tax records which are not the source of funds. They are also in Chinese.
If you don't supply the information they request then it will definitely take a lot more time to resolve than just doing it.
We faced similar issues when we sold a house in France and wanted to repatriate the Euros. "R" need to do money laundering checks before they will let you transfer large amounts of money (I do not know what the threshold for large is) and in my case the process was smoothed by contacting them first and providing the necessary information before the transfer. The real difficulty is that making contact with R is quite difficult and even the contact area on the app hard to find. It seemed to get easier when I upgraded my account but also made some sort of contact on Twitter. All was resolved quite easily in the end.
Iminquarantine said:
bobbysmithy said:
I think the issue is that they are not able to provide all of the information being asked for.
Yes, there is proof of funds. The solicitor has accepted this as complying with AML regulations. They have asked for payslips and tax records which are not the source of funds. They are also in Chinese.
there are 3 stages of money laundering - placement, layering (doesnt apply here) and integration. By selling of the property is the integration phase, they are interested in the placement stage i.e. bying of the property.
They cannot tell you if they are investigating or anything.......asking for proof could be genuine or it could be stalling (i.e. hiding whats going on in the background). If all your proof is in Chinese they will probably expect you to get translations at your own cost.
Nothing you can really do apart from go along for the ride it is a legal requirement of financial institutions to investigate such transactions, unless it would seem if you are a world leader and definitely a high risk money laundering person, when rules dont seem to apply to them. Funny how all their ill gotten 'assets' are suddenly frozen when they are deposed,........ but not before?
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