Printer Friendly

Why getting it right in British banks is not simply a matter of form.

Byline: Nevill BOYD MAUNSELL

Here is an everyday story of British banking in 2006.

A couple of weeks ago, my daughter went to the Nat-West branch where she has banked since she was 16 - and found sensible and helpful through some years owning and running small private companies.

Now she wanted to withdraw pounds 1,000 in cash from her personal account.

Oh no, they said. The money is in the account, but if you want pounds 1,000 cash you must go upstairs to business banking. There is a form you have to fill in. Up she went and joined the queue of Ozzies and Middle Eastern gentlemen waiting patiently to shunt their money round the world.

When she got to the front the form turned out to be a long one and she was about to miss a train. So she had to took it with her and go back next day to collect her pounds 1,000.

"Another time," said the kindly girl behind the counter, "ask for pounds 999 and they can let you have it straight away."

That is how we stop money laundering.

Al Qaida's paymasters must never get their hands on a four-figure sum unless they stand in a queue and fill in a form.

The same with drug barons - except that their problem is supposed to be paying in tainted cash, not withdrawing it.

That is why opening a new account is such a pain nowadays.

None of it is likely to bother either category unduly. They have their own ways of arranging things, no doubt.

But it is a crass inconvenience for a law-abiding citizen who wants access to pounds 1,000 of her own money - and for the banks, too. So two cheers for the Financial Services Authority as it proceeds gingerly with its "Better Regulation Action Plan", BRAP in FSA-speak, first announced back in December.

The theme is plain and admirable - to shift away from the present array of pernickety box-ticking rules (like those that cause the nonsense at the bank) to regulation based on broad principles focused on the outcome, not the process. And the whole thing is to be done with an eye to the balance between the costs and the benefits. Fine, but not necessarily easy in practice. There is not much of a problem with megabucks. Corporate finance outfits and investment managers running institutional money can take the cost of doing things the FSA's way in their stride. It is a tiny proportion of their expenses, though less tiny for smaller organisations than for their big brothers. But they all benefit from the perception round the world that things are done properly in Britain. The rub comes with the so-called retail side, selling private individuals pensions and investments, explaining just what they are buying, taking trouble to see that it suits their circumstances, then covering your back by keeping a record of everything that has been said and done.

So far the FSA has worked on the basis that prevention is better than cure. The fines it levies are very rarely for hanky-panky, nearly always for failing to have this or that safeguard in place. Quite right, perhaps, but too cumbersome for the purpose.

Making it less so will not be easy.
COPYRIGHT 2006 Birmingham Post & Mail Ltd
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 2006 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Title Annotation:Business
Publication:The Birmingham Post (England)
Date:Jun 29, 2006
Previous Article:Takeover talk helps out music and steel; MARKET REPORT.
Next Article:Sertec founder leads buyout.

Related Articles
A conversation with Cem Arikoler: Regional Director, Promax Middle East, Dubai, United Arab Emirates.
TALKING SHOP: Home punters the losers over 48-hour decs.
Schools frustration.
OEV: "Central Bank not talking to us".
BANKS FAIL TO KEEP PROMISES; Darling hits out at lack of aid for businesses.

Terms of use | Privacy policy | Copyright © 2019 Farlex, Inc. | Feedback | For webmasters