it all has to do With AmL and anti-terrorist laws.

folks dealing with a lot of cash transactions, f/x, crypto, casinos etc. while it all May be legal, banks don’t want to get caught with suspicious activity flowing thorough their accounts.

 

You forgot OnlyFans, Fansly, Patreon, YouTubers etc

Banks really hate OnlyFans girls, digital nomads and basically anything to do with the internet such as crypto.

Which is only speeding up their post boomer demise

 

The challenge is that only one side of the argument/reasoning is ever heard.

The banks are bound by confidentiality nor are they about to open themselves to litigation. They remain silent. As they should.

 

I had family in senior 'big bank' branch banking positions for over a decade. There are good reasons to de-bank certain customers as noted by post #2, and the occasional customers were de-banked.

 

Let's also remember that there is a ton of real estate fraud and money laundering in our country.

Plus digital nomads dodging taxes, crypto people doing illegal things all over the place... these are some of the red flags for banks.

 

The banks are trying to enforce boomer-era rules on a zoomer-era economy.

This is why we need younger people in government in a world changing exponentially faster.

Yes there needs to be rules but stop applying horse era logic to the automobile.

 

They have no obligation to provide service to those that do not respect the law or meet the terms and conditions of their account agreements.

Correct, but if you're not breaking the law, or the account agreements, they should not be allowed to debank you.

There is a lot of scummy/nefarious folk around,

yes, and that's why the law should be enforced.

Let's also remember that there is a ton of real estate fraud and money laundering in our country.

Plus digital nomads dodging taxes, crypto people doing illegal things all over the place... these are some of the red flags for banks.

Yes, and that should be prosecuted.

 

Correct, but if you're not breaking the law, or the account agreements, they should not be allowed to debank you.

I don't entirely agree. Some customers can be risky from a regulatory POV and/or toxic in other ways such as verbal abuse of staff. They do have to document internally reasons why for their own risk management depts and I suspect the regulator would want to know why if there is a pattern of such situations with a particular bank, or a bank branch.

The story is incomplete. I am willing to bet that most individuals who have been de-banked have a pretty good idea why they have been de-banked but are not provding an entirely accurate picture.

 

The CRA is cracking down on crypto tax evasion so the banks may be avoiding having to deal with problem accounts that would be frozen by the CRA anyways.

 

If true better sell your bank stocks - because the zoomers are here to stay and the boomers are dying off everyday

 

Some of the present accounts with bad actors speculation I surmise comes from how easy it is/was to open a bank account in Canada.

It was a while ago, but in 1999 I was working in Queensland Australia. I was there for at least 2 years. It ended up being 3.75 years.
I needed a local account for paycheque deposit from our local subsidary that was paying me, and day to day utility bill payments. And to get a debit card.

I went in to a local branch of one of their national banks.
With my lease to establish a local address.
And my passport, which held my work permit/visa to document who I was, and that I was there legally.
These alone did not qualify for enough 'points' to open an account.

I end up getting a letter written by the project boss, an Australian with good rank in the civil service.
I stood at the counter while they called him to verify the letter was real.
Only then could I open a bank account.

I dont think Canada's banking regulations are as stringent.
So that could be part of the present de-banking discussion.

 

Some of the present accounts with bad actors speculation I surmise comes from how easy it is/was to open a bank account in Canada.

It was a while ago, but in 1999 I was working in Queensland Australia. I was there for at least 2 years. It ended up being 3.75 years.
I needed a local account for paycheque deposit from our local subsidary that was paying me, and day to day utility bill payments. And to get a debit card.

I went in to a local branch of one of their national banks.
With my lease to establish a local address.
And my passport, which held my work permit/visa to document who I was, and that I was there legally.
These alone did not qualify for enough 'points' to open an account.

I end up getting a letter written by the project boss, an Australian with good rank in the civil service.
I stood at the counter while they called him to verify the letter was real.
Only then could I open a bank account.

I dont think Canada's banking regulations are as stringent.
So that could be part of the present de-banking discussion.

Bank accounts are basically considered a “right” in Canada. If you have one or two pieces of decent ID, you’re good to go. There are less stringent requirements too….mostly geared to the disenfranchised.

 

I sometimes overhear the "disputes" that happen at the counter of my bank. I have been hearing these a lot lately.

Just the other day, a young woman walked up to the teller and tried to deposit a large amount of cash. She was a visitor with a visa.

The teller asked her where the money is coming from. The woman said that she's on a work visa and that this is cash from her restaurant work and tips. The teller remarked that this is quite a large amount of tips. Asked her if there are other sources for these funds besides just tips. The young woman started to become angry, and asked for a manager. The supervisor came and had the same dialogue ... what is the source of this cash?

I was finished with my banking by then, but it looked like the bank was not going to accept her deposit.

 

This would be highly unusual a few years ago. That deposit would be accepted in seconds…..unless we’re talking amounts around $10,000 or more.

i suspect the banks have been told to scrutinize cash deposits a little more closely.

 

A number of years ago we opened an account with RBC in London, England. City branch.

Went into the branch to see if the funds had been transferred from RBC Canada. Then it started....how did you get this money yata yata yata. We had our passports, the lot. Along with a local London address. Never worked so hard to make a $5k or so deposit tranferred in. Hate to think what would have happened if we had tried to depost $5K in cash.

 

I believe that the answer for some people may be to ensure that their banking relationship is not limited to one institution.

Over the years have always dealt with two, a bank and then either a trust company, bank, or a large credit union. It started years ago when we were shopping for our first mortgage.

We do not want to be tied to any one financial institution for any service or product. It is easier for us because both B&M banks that we deal with have senior accounts that do not incur service charges. We maintain joint and individual accounts at each institution. And we have credit cards in each of our names as the primary cardholder.

 

They are not denying people their right to bank albeit I do believe the debanking bank should* give the customer a reason. I will guess there are something like 20-30 or more unique deposit banking choices based on the CDIC Member List. Then one can also consider credit unions. If one FI debanks a customer, then that customer moves on to the next bank and so on.

I honestly do not think any FI takes any great pleasure in terminating a relationship due to the admininstrative costs in doing so in addition to reputation risk. I suspect where there is some smoke, there is at least some hot coals.

* I say should but that might just create a 'he said, she said' argument between bank and customer. It is easier just to show the customer the door.

 

A question for you @Money172375 since you know what kinds of things they watch out for.

I shuffle cash around between different accounts, often chasing high interest promotions, or trying to jump on a good GIC rate, or keeping a balance of where my cash is available and idle. For example, one bank's high-interest promotion just ended, so I transferred out large cash balances. But then a few days later, I decided to transfer a couple thousand back in (reverse direction).

In the account activity, this results in seemingly circular / unnecessary transfers. For example I might send 15K from BankA -> BankB, then a couple weeks later, transfer 9K from BankB -> BankA.

Do you know if this can raise flags? Should I avoid doing too many transfers? These transfers are always between the same domestic banks, all accounts in my name, electronic (EFT) transfers.

 

I wouldn’t worry about it. Transfers to your own accounts are not usually deemed unusual.

The two scenarios I would see in particular are numerous cash deposits and multiple transfers to 3rd parties. When you see the actual transactions being investigated, it’s almost painfully obvious that something unusual is going on. I’m talking a half dozen or more transactions a day, 3-4 times a week.

Or transactions involving foreign exchange companies, white label ATMs, casinos, money marts etc.

Although I never quite figured out why the bank was so concerned with one particular reoccurring issue. People who ”ran a business“ through a personal account and not a small business banking (sbb) account. The obvious answer is loss of potential service charge revenue, but it always felt deeper than that. Like there was some enhanced scrutiny of SBB accounts.

 

I am not close to this but anecdotally from family members, I believe that kind of activity is not a particular issue because the funds are EFTs between known domestic banks. It gets more dicey with incoming International wire transfers, cash deposits et al that the Canadian bank sees as 'black holes'.