DO NOT Keep Cash/Assets At Banks You Have Credit Cards With

DO NOT Keep Cash/Assets At Banks You Have Credit Cards With


I don’t mind continuing this discussion if you want to start another topic or we can do it over PM. I just feel bad for derailing this topic.

I don’t disagree that some, maybe even most people “think about those things” as they hand over cash instead of plastic. But I am not one of those people. I have no special attachment to cash and have always treated plastic the same way I treated cash – it’s my money. I even often pre-pay my card balances before the statement comes out, so just take my word when I say that there’s no disconnect in my brain between plastic and cotton.

As far as my example of not looking at the price of groceries – it hasn’t always been that way. I was broke in college and had to seriously budget for food. If I had $150 in my checking account for food that month, then I couldn’t and didn’t spend more than $150, and it didn’t matter at all whether I paid cash or credit. But now my wallet is fat and I can afford to eat whatever I want (except maybe Whole Foods, although I haven’t been there since the takeover). The small price fluctuations in the price of groceries don’t make much difference in the long run – my average food expenses have been pretty stable since I started tracking. I won’t buy lower quality or soon-to-expire food (yeah, I’ve shopped at Food4Less a few times) or spend my time couponing, because I value my time more than the few bucks I might save (and because the things I buy don’t have coupons).

  1. Keep my other cards fresh
  2. I do a lot of low interest rate BTs. I like to use my non-2% cards “fresh” with at least a little bit of normal usage. IDK if that is really needed or not, but it doesn’t take a lot of effort
  3. As others have said, benefits other than cash back
  4. Maxed out credit limit (may or may not include cycling the credit limit within the statement period), so need to expand to other cards


Guapo – Maybe not a meaningful data point, but my largest CC limit is $75K – with BOA, with whom I have no other relationship. The “may not be meaningful” part is that this is an old MBNA card I got back in the pre-crash days.

With other FIs, I have several $25K to $30K lines with no other relationship – some of these obtained in a post-crash timeframe. I know of many others with much larger lines than that without other relationships.

SOME banks are known to look for a relationship for higher limits. It also helps on recon at CUs. “Oh, I see you have eight gazzillion dollars with us”, the CU CSR says as you ask for a higher CL…


“[quote=“teeman, post:43, topic:555”]
Banks cannot take money from your other accounts without a court order, so it’s nothing to be concerned about unless you’ve gone through a bankruptcy and a court is giving orders about your finances.

I would appreciate a good accessible legal discussion.

The situation I am in is that CITI has frozen my bank account which has only a social security it.
This has included not honoring bill payment instructions (to Discover card and American Express). An attempt to use their internal transfer to pay a CITI card was blocked.

As far as I can tell there is no legal dispute about my ownership of the funds, their source, or who I am (I have been a customer for at least a decade and am known to their “Gold” client representative).

The problem started when I tried to open a new CITI Wealth Management account for a brokerage, and gave honest answers to what my wealth was. There was followed by intrusive question about my last salary, how much I had inherited from my father, my investment strategy, etc. which I tried to answer from memory. They concluded (correctly) that I had earned higher than average returns from investing and could not prove all my wealth was legitimate (many records have been destroyed in a natural disaster or lost during the last half century, and I never had access to my father’s financial records). It is not implausible that someone who was an internationally known expert in stocks might be successful in his investing. Their wealth management people refused to accept my request to open an account with somewhat over $100,000.

Months later there was a call from some representative elsewhere with intrusive questions again about my financial affairs, but she could not explain just why they needed to know this (or why she had been asked to find these things out). Much time was consumed in a good faith effort to answer her questions, and some records were even consulted

Eventually, I noticed on my statement that the amount on deposit was higher than expected (being the full amount of my social security check) and the reasons was that instructions to pay Discover card and American Express) had not been carried out.

After a chat and a phone calls, I was told there was no problem with my account, but further calls revealed it was frozen on orders of the “know your customer” unit (anti-money laundering). I had Gold Customer status (those with large assets with CITI, including their brokerage unit) with CITI, but the very polite representative who knew who I was and had met me once at the branch (as had others with this title before he was hired) could not resolve the issue.

Fortunately my losses have not been large. Discover and Amex got paid and my credit rating remains. When CITI’s web site refused to let me transfer money from my CITI bank account to pay the minimum on my CITI card, it was paid from another source.

I believe the agreement with the CITI subsidiary which issues my cards is government by the uniform commercial code, which states that if payment of a debt is tendered in legal currency and the debtor refuses the accept the payment, the debt in unenforceable. I would argue an attempt to pay a CITI card’s minimum via a transfer from a CITI bank account was a tendering of payment in a legal currency (and one CITI had previously accepted). In practice, the CITI card was paid from a non-CITI bank account (I did not want to ruin a long term perfect payment record by having a small payment be late and CITI report it that way).

From a constitutional basis it is clear that the US government cannot seize property and conduct searches without reasonable cause, and that someone has assets is not a valid reason for demanding he account for all the money he has, much less for seizing assets (whose legitimate source, a direct deposit of a social security check) is not in dispute.

In practice, I suspect that what is happening is that the “Know Your Customer” group is busy with big anti-money laundering issues, and does not give high priority to freeing up the account of a customer who cannot access his social security check.

However, if anyone knows a good source for the law in this area I would appreciate knowing more, in case I decide to invest more time in this issue, or even to take legal action.


IMO “citibank refused to release the funds” is not the same as “citicards refused to accept payment”. Same parent company, different divisions, probably different legal entities.

If your soc.sec. payment is still frozen, you should probably consult a lawyer familiar with the subject. Some “enhancements” to KYC rules took effect in 2018, so they started asking more questions than before. Maybe they’re allowed to do what they’re doing, but IMO not releasing your soc.sec. payment is unconscionable, KYC or not.



Ahh, a classic mistake.

FYI: when you talk to companies and start talking about how what they’re doing is unconstitutional, you immediately lose a lot of credibility. I’m not saying what they did is or isn’t constitutional, but I would leave that part out except in debates or theoretical discussions.


Legally you are correct that CITI bank being a different entity than the subsidiary than issues the credit cards is correct, and this would probably be their defense if the case went to court. However, they present themselves as one organization, and they should be able to use fund on deposit them them to offset debts to another part of the organization.

The unconstitutional remark is aimed at whether government rules actually require this, and whether they are subject to such rules.

You are of course right that this argument is best not used in discussions with a bank, except indirectly. If they have interpreted some rule as requiring this, a reminder that laws are normally interpreted as consistent with the constitution is relevant.

I am hoping the assigned “Gold” client representative will eventually solve this. Legal action or appeals to consumer protection agencies, or making their bad behavior public through the media are possible.

At this time, ordinary customers like me do not have a way of determining who ordered their accounts frozen, or who has the power to get this reversed.

In organizational terms I suspect there is someone who believes the top priority is preventing money laundering. Serving customers, or even complying with the laws regarding returning money on deposit is probably viewed as not his job.

I am not even certain which agencies are responsible for enforcing the laws regarding not taking money on deposit that I should be complaining to.

An indirect consequence of this is that cash with their Wealth Management unit is effectively frozen since my usual way of withdrawing it would be transfer to my CITI bank account and then on to a final destination. I fear any money going into the bank will be frozen, so I am reluctant to do this.