What Is It With Banks These Days?

HSBC: The World's Local Bank, yeah, right!

This was going to be a tale of the warnings we received about dinosaur British banks, but the ever competitive Americans decided that they wanted to steal the focus.  While it isn't easy to open a simple bank account in the UK (more later), our recent experience with a US bank makes British banks look like the Starship Enterprise.  In fact, I'm beginning to think that unlike their British counterparts, US banks are truly hostile to foreigners and that includes, American citizens living abroad, like me.

When we were in Hong Kong on our way to London there was an HSBC ad running on TV there.  A little girl is selling lemonade from a stand on a residential street.  A Brazilian woman and her child come up to make a purchase.  The little entrepreneur points out she takes Brazilian Real.  The same ad runs here in the UK, but the mother and child are from Hong Kong and the little entrepreneur takes Hong Kong Dollars and even speaks Cantonese.  The ad likely runs in the US and other HSBC markets.  The ad finishes with the message that HSBC is "the World's local bank" and that they're interested in the little guy - or girl as the case may be.

Well, it's all a lie, at least where HSBC America is concerned - I don't want to taint all HSBC operations.  We had an HSBC account in the US since we lived there several years ago.  With family in the States, it made sense to keep it.  It makes gifting easier, saves exchange rate issues for travel home and with elderly parents - well you never know when you might need to move some money fast.

Our latest statement arrived at the end of May.  I opened it and to my surprise I found that we had a zero balance.  WHAT!?!  Identify theft?

No.  Closer inspection showed that all of the funds were withdrawn on 3 May when the account had been closed.  Surely, an identify thief wouldn't have bothered closing the account.

So, I rang Washington DC, where our account had been transferred a few years back for some unknown reason - Homeland Security, perhaps?  It was a direct line to Tim (name changed to protect the innocent).  No, answer.  I left a message.  Two days later still no reply.  So, Rob weighed in.  A few hours later, I picked up the phone to Tim asking for Rob.

I explained.  Tim thought he knew what the problem was but needed to check.  He checked.  Yes, it was a decision by HSBC America in January 2012 to close thousands of accounts of people who did not live in the US and who didn't have a lot of "activity".  I asked why US citizens couldn't hold US accounts anymore.  This confused him.  I don't think they looked past Rob.  Now, we didn't have millions in the account, but I'm sure we had a few thousand more than the lemonade entrepreneur.

Tim explained that someone should have contacted us.  I explained they hadn't.  He said a note on the file showed a cheque had been sent in early May, but he couldn't tell me a date or where it was sent.  I asked how I'd cash it with no US account and wondered if they could transfer it instead.  He could not help.  He started to give me a 1-800 number.  I explained that won't work in the UK and threw in I thought you guys were supposed to be bankers to the World.

He gave me a New York number to call.  They could help cancel the cheque and set up a transfer.  The Washington DC branch couldn't - good to know all you international organisations in Washington.  I called New York.  To my surprise someone picked up first ring, but she explained she couldn't help, because that office worked with branches not customers.  She tried another number.

Customer service was not as fast for customers.  Eventually, the branch woman gave up and said I could continue to hold but gave me the correct number to call - "just in case".  About 10 minutes later (my dime remember), Terri picked up.  She too knew what the problem was, but said she wasn't allowed to give me details.  Suspicious by nature, I asked if it was an HSBC decision or a US Government decision to close thousands of accounts without permission.

She 'assured' me it was an HSBC decision, but then proceeded to pepper the conversation with comment about US Government regulations.  Hey, if she wanted to claim responsibility for her bank, what can I say?  Anyway, all I wanted was my money at this stage.  She told me the cheque was in the mail - sent the day before as a matter of fact.  Was that a joke?  It wasn't.  I asked what address was used fearing they had sent it to New Zealand.  She said the UK one and it should arrive in five or six days.   I asked how I was suppose to cash it, since thanks to HSBC we no longer have a US bank account.

You won't believe it and I kid you not, but she offered to open an HSBC account for me on the spot - all I needed was a one dollar deposit.  I succeeded in not saying what I was thinking, and pointed out that they had just closed a perfectly good account.

I asked how I could get a dollar to her.  That caused a problem for this employee of the World's banker.  She didn't have an answer.  So, I thanked her for her offer and said I'd wait for that cheque that was in the mail.  Well, two weeks later, it hasn't arrived, but we are ever hopeful.

If it does arrive, I'm hoping HSBC UK is a little more aware of the World and will be able cash the cheque.  If not or if it doesn't arrive soon, some poor sod at the offices of the World's banker in New York will be getting an ear full.

Now to the Starship Enterprise (Captain Kirk series) - where the problem with American banks is that they don't want to keep your money, British banks seem not to want to take it in the first place.  We had heard all the horror stories.  One friend told us it had taken three months for her to get an account set up.  She just wanted to deposit money.  She wasn't looking for credit, but until she could provide proof of income from a permanent employer, she was out of luck.  She was temping at the time and that didn't count.

It had been suggested to us that we set up an account before we left New Zealand.  We rang banks in Wellington hoping they could help, but had no luck.  We called a London bank that had been suggested.  They asked for our London address and assorted other questions.  Not surprisingly, since we weren't there yet, we couldn't answer them.  So, the best the guy could do was offer to arrange an appointment for us.

Beggars can't be choosers, so, we arranged an appointment for 9am the day after we landed.  Before we hung up, the guy reminded us that we needed to bring along a power bill, phone bill or the like to prove our address.  No way for that to happen 24 hours after arrival, but no need to explain either.

We arrived at our appointment.  We were taken to a cubical and the inquisition began.  Did you bring a phone bill or something that shows your address?  No, but we have this letter from Rob's employer.  We don't usually accept such letters but I'll check with the Branch Manager.  She went away.  She came back.  It was fine - hurdle number one, cleared.

Next followed a long series of questions about property owned anywhere, jobs in London, salaries, other bank accounts, net worth, etc.  We each had to proved details individually.  Rob went first - he had the job already.  As it went on and on, there was a point where I realised she didn't really care about accuracy.  She just needed something for the online form she was filling in.  As a test when Rob paused for a answer he was calculating in his head for accuracy, I said, "Just make it up, she just needs to fill in the blank."  Her smile confirmed my suspicion.

While you don't want to lie to your banker, it seems other bankers find their bank's rules somewhat silly too.  Some newly arrived friends told me recently of a similar experience, but their banker was even more helpful than ours.  He actually suggested fake employers and salaries and accepted their word for a permanent address.  They had their bank account (no credit cards were requested) in an hour and a half!

Anyway, two hours after our inquisition started, we were told she would have to check with someone else to get approval to open the account.  Reaching that office proved difficult so it was suggested we come back later.  We went for a walk, we had lunch and got called back for another appointment at 3pm.   We returned to the office and seven hours after it all started we had an account - much faster than we had expected!

My advice to new arrivials?  If you can, get a UK bank account before you leave home - get it.  If you can't, you need a bank account to get a phone, rent a place, turn the electricity on and everything else.  So, you won't have the address proof banks want.  All you can do is keep trying branches until you find a banker with a helpful disposition, who recognises the Catch-22 situation you are in and who has a passion for fiction.

Update: 

22 June 2012 - Almost a month since HSBC America promised the cheque was in the mail, we still do not have our money.  Apparently, the cheque was returned to the DC branch (the ones who knew nothing and sent us to the 1800 number), but no one will tell us where it was supposedly sent to begin with.  After more phone calls, emails, letters and many empty apologies, the latest is we have been promised a cheque in about 10 days.  This time the promise is the cheque is going to be in the mail.  The incompetence of HSBC America continues...