Are the 8,000 or so Jersey-based accounts frozen by Lloyds fonts of dirty cash?
The bank has been trying for three years to get their holders, largely longstanding customers whose details require checking, to prove their identity in compliance with international standards.
Having made multiple failed attempts to contact them since January 2016 it has now pressed the button. Their accounts will be in the deep freeze until such time as the documents required to confirm their identities are submitted.
Lloyds’ move comes against a backdrop of tighter “know your customer rules” that banks across the world are grappling with. Others have been similarly rattling their customers’ cages and it would be no surprise to see similar stories to this one emerging over the coming months.
The answer to the first question is, in all likelihood, no. In the vast majority of cases the money will be from legitimate sources and held in one of Lloyds’ Jersey accounts for legitimate reasons, such as the holder working abroad.
But the hoops banks are having to jump through to establish and confirm their customers’ identities and source of funds are becoming greater, and the measures they are having to take to tick the regulatory boxes required of them more onerous, as watchdogs seek to put the squeeze on international money laundering and tax evasion.
What really makes this story interesting, however, is how it comes just a week or so after Facebook announced the launch of libra, its new cryptocurrency, into the world.
The big selling point with libra is that it will be a means through which the teeming masses of unbanked will be able to access the digital economy. Got a phone? Get Facebook and you’re good to go.
It’s a new form of money, that will, unlike bitcoin, have a stable valuation through being linked to a basket of international currencies, which will make it far more useful as a means of buying goods and services and a handy, and cheap, means of transferring funds from person to person.
GW: Don’t touch it with a bargepole folks.
ukgovernmentwatch 