Taking Money Laundering Checks Too Far

Money laundering is an international crime and the Treasury and the Financial Services Authority are quite right to lead the charge to try to stamp it out. Fortunately, most UK-based Independent Financial Advisers like myself don't expect to be targeted – particularly if we don't advise on mortgages – and when most of the names on the regular Treasury hit list seem to be well-tanned with numerous aliases – and we don't see many well tanned people in East Anglia.

But there is another side to this coin and that is what I perceive is increased harassment of older people by large institutions. Take, for example, the recent takeover of the Henderson (formerly New Star) International Property unit trust by Aviva. Probably a good move in itself and, not surprisingly, Aviva needs to doublecheck details of their new clients’ identities and addresses. So they go to Experian which is the main credit card scoring agency. Unfortunately, not everybody has a credit card these days and not everybody – particularly older people even have a current passport or driving licence. Quite often it’s not easy to obtain verifiable information about a person. So why did bright Aviva not try something else rather than sending anonymous style letters to several of my clients – one of whom is almost blind!

Several of these clients have other Aviva investments so why could there not have been some internal cross-checking and then if Aviva knows that there is a Financial Adviser, why not contact that Financial Adviser rather than worrying ageing clients about official looking letters?

It is also rather interesting that in the list of “evidence of address” documents, it appears that bank statements are no longer allowed even when issued within 3 months whereas utility bills issued in the same time frame are allowed. Very strange!

There is no doubt, as said at the beginning of this article that money laundering is a serious offence. However, I do worry that older clients are being harassed to provide evidence that they may not be able to do so easily. The worst nightmare is often the person going into a nursing home because all their utility bills are part of the nursing home charge. Then one has to very nicely ask the nursing home owner or matron to provide a letter indicating that said client is now a resident of the home.

The next task is to try to convince Aviva that another client is kosher. Aged 85, she has never had a passport and gave up driving when her husband died many years ago. She is virtually housebound so does not even have a bus pass. The only photo ID I could find is a disabled blue badge ID sticker when is still – just – current.