Bank begins closing and blocking transactions for Hong Kong and Jersey accounts

HSBC has taken the decision to avoid further tax evasion scandals by adopting the process of “de-risking” and closing bank account of customers that may be considered high risk. In the latest round of recovery actions taken by the bank, HSBC Jersey have sent letters to customers saying “we’ve taken the difficult decision to close all Jersey accounts for customers who don’t live there. This is to comply with HSBC Group standards.” This comes after HSBC Hong Kong has been systematically sending out Transactions Blocking Advice, blocking users for all transactions since end of 2014 informing them “In order to ensure authorize use of your account(s), we regret to advise that the above mentioned account(s) have been blocked for all transactions. In accordance with our general terms and conditions governing the account(s), we shall proceed to close the account(s)."

HSBC is not the only bank that is expected to be implementing contingency plans such as this, we expect other banks will follow in what could be viewed as a long term change in how we do business.

How it may affect your business

Having a company’s bank account terminated without notice can be disruptive to a business. Customers are often given only days to obtain a new bank account to have the exiting funds transferred otherwise all funds will be returned to the original remitters. Notifying existing customers on changes in online payment system as well as payment method and account can be both a frustrating and painstaking exercise.

How can ALCPA assist

ALCPA is a regulated professional firm with more than 35 years of track record in assisting clients in compliance and related activities. We are specialised in advising and assisting clients to establish corporate structures as well as opening and maintaining corporate bank accounts. Through various agreements with banks, on recommendation by ALCPA, we may be able to reduce or waive account opening fees costing as much as US$1,100 even before a bank account number is provided.

Please feel free to contact us should you require more information on the above.


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