The increasingly more restrictive regulations on AML (anti-money laundering) are being used by less than serious financial institutions to keep the money of some of their customers or to not pay them when they are lacking cash. It happened to many offshore operators that, when requesting a transaction, the financial institution asked them for various documents; the money for the transaction or, at times, the account itself is frozen until the requested documentation is presented. This can, in certain cases, take up to several weeks, while the person requests certificates and has them apostilled, translated and sent. The result is that nowadays commercial transactions made through banks or cards can be slow, tedious and unsafe.
Well, this is the price you have to pay to combat money laundering and financing terrorism and/or criminal activity.
Recently, one of these businesses that use these policies to scam and extort, blocked the transfer of a customer whose remittent was another financial institution. What law gives authority to a company that issues cards to block outside money that originates from another card provider?
Intercash, a MasterCard card distributor on the market for more than 10 years, states on its website www.intercash.com, which is the property of Andaria Ltd, a business supposedly registered on the Isle of Man. Controlling on www.gov.im, Andaria capital Limited and Andaria Limited appear, however no business registered with the name Andaria Ltd. appears. The site itself was registered anonymously to conceal the property, contrary to all of the policies of AML and transparency.
On the site itself, Intercash states that Andaria Ltd. is not and is not required to be licensed by the Isle of Man Financial Supervision Commission Funds. But then, what license are they operating under? None, it would seem because we investigated the United Kingdom’s Financial Ombudsman and they told us that there is no financial business registered under the name Intercash or Andaria Ltd. Nonetheless, Intercash uses London phone numbers for their customer service and implies that it has offices in the Kingdom. It also states in the site that funds must be processed via Complete Solution, MSB registration #M17664559; however, on the site https://www.fincen.gov/msb-state-selector of the Financial Crime Enforcement Network of the U.S. Treasury it says that the registration number must have 14 digits and no registration with the numbers reported by Intercash appear. They also state on the Intercash website that they are administrators of approved MasterCard ISO programs, although Intercash is apparently an offshore business with not-well-identified property and beneficiaries, contrary to AML policies. Also the web name and website are registered anonymously.
Let’s analyze how Intercash developed the extortion of its customers, point by point:
The customer sends the sum of 105,138.81 EUR from his account in a financial institution in Gibraltar. Fifteen days after receiving the sum, Intercash notifies the customer that the entity which sent the money was supposedly flagged (Note: the entity, not the customer; and it doesn’t say where it was flagged.) and Intercash, which has received all of the information, including a six month history of the movements of the money, says that it will open an investigation on the funds. If there was something odd, why didn’t they alert the authorities?
The customer sends the sum of 105,138.81 EUR from his account in a financial institution in Gibraltar. Fifteen days after receiving the sum, Intercash notifies the customer that the entity which sent the money was supposedly flagged (Note: the entity, not the customer; and it doesn’t say where it was flagged.) and Intercash, which has received all of the information, including a six month history of the movements of the money, says that it will open an investigation on the funds. If there was something odd, why didn’t they alert the authorities?
After the three months, Intercash says that they have concluded the investigation, that they are going to close the customer’s account and return the client’s money to him, minus 11,987 EUR for legal expenses for the investigation.
The customer obviously makes a claim arguing that there are no invoices or proof of investigation expenses, that said expenses were not authorized and that there is no clause in the contract with Intercash that authorizes this type of expenses. In addition, that all time and always has immediately provided all of the requested documentation (Note: this is why they didn’t steal everything), that no law allow this and that, in addition, the money sent by the other institution is money that must be reimbursed to theyr client.
At this point, Intercash sends an extortive e-mail in which it states that, if it is must that must be reimbursed to the clients, they could open an investigation on each customer and that this would go into effect if the customer doesn’t accept the legal “expenses” charged by Intercash, who specifies: We have recommended stopping this investigation before it gets more complicated and stopping your fees, so that you can recover most of your money.
What can be done at this point? Begin a legal battle or accept the theft of 11,987 EUR? Obviously, as some of us have done, the customer has accepted the forced discount, has accepted the reimbursement of the difference and has signed an abusive or leonine clause (Note: null and void) under coercion of losing all money in a non-existent investigation that could last indefinitely.
If, on one hand money laundering and financing terrorism and criminal activities must be investigated and battled, honest users must also be protected from abuse of AML policies because of a lack of regulation. What I mean to say is that, for example, a financial institution should close its investigation within a given period, for example, 15 days; and in case it couldn’t reach a conclusion, it should remit everything to the proposed authorities. It’s absurd that a financial entity can make this type of abuses and get away with it. Obviously, no serious bank or integral financial institution abuses Compliance policies, but what can be done in a case similar to that of Intercash? To whom should you turn and when? And, if they are stealing an amount that could equal the legal expenses needed to recuperate it, does it make sense to make a claim?
There is currently no standard regulation for AM procedures; each bank or institution creates its own unwritten policy and regulation, supposedly to avoid letting money launderers from knowing these policies, and this obviously leaves much room for interpretation of the on-duty oversight officer. However, this is becoming more complicated because of “security reasons” there can be no communications between customers and oversight officers. So, communications are always through a third-party: the customer service officer contacts the customer, requesting what the oversight officer requires; the client responds and the customer service officer sends back the information he considers convenient to the oversight officer. Everything is impersonal, without the right to defense and/or replica.
It’s necessary that international financial authorities take urgent measures and regulate these policies that are easy prey to abuses, theft and extortion.
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