“[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 payment.in 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.