Noel Whittaker is the author of Wills, Death & Taxes Made Simple and numerous other books on personal finance. Email: [email protected]​

There’s a nasty weed disrupting the world of finance: KYC. It’s pervasive, affecting more people every day, yet most people have never heard of it. The letters stand for 'Know Your Client' and, like many obstacles in our modern lives, it was born with the best intentions. It’s an international problem intended to stop villains by ensuring that institutions know who their clients really are, but it is now running wild in all developed nations. It seems to me that KYC does nothing much to stop the bad guys, and it causes a huge expense and loss of productivity for the rest of us.

This month, we sold the last of our residential investment properties, having learned the hard way that residential real estate requires a lot more effort than shares for a much lower return. Of course, I asked our family solicitors to do the conveyancing. As part of the KYC rules, they told me they would have to identify us. When I asked why they would need to 'identify' two people they know well, who have been clients for 30 years, the response was, 'It’s a legal requirement'. So we had to produce passports and driver's licences and jump through all the other hoops associated with getting ID signed off.

Then, I talked to the bank about where it is best to deposit the sales proceeds and mentioned the possibility of opening an account to keep the money separate from our other funds. I wanted to put some into a 12-month term deposit, ready to pay the capital gains tax (CGT). We all know that easily accessible money tends to get spent, and the last thing I want is to get a bill for CGT with no money ready to pay for it. Guess what? The bank, of which we are also long-term customers, said that when opening a new account, they had to formally identify us under the KYC rules.

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[BellaB18]

My goodness Noel is pointing out the obvious that l have not thought about. As in the scammers how they get away with so much as he pointed out all the identity we have to go through. I am going through that now applying for my husband to be my full time carer, with Centre Link. I have been on DPS payment for quite a few years and my husband has been receiving the carers allowance for the same amount of time. Now he has stopped working to be my full time carer we are applying for the carers payment. Even though they have all our ID. We still have to present our driver's licences marriage certificate birth certificates and Medicare cards also his tax assessment for the last financial year. How do the people who do the wrong thing and steal from centre Link do it.
I suppose because we are honest people we would not even think about doing the wrong thing let alone how to go about it. I am so grateful we are able to apply for the financial help we need. There is no guarantee my husband will be accepted even though we have dr's reports and so on.

Kind regards to all Vicki

 

[Cathyann]

I have been concerned for a little while about all of this, in many area's. It has been so easy to purchase on line and we give away our details without a thought at the time - but now as an after thought "How stupid have I been?"especially with these recent information leaks of very large company's we have trusted with so much dedication , (and still do?). However it is done now and we cannot take back the records held by these companies -who may and could get hacked at any time. Do you buy on line??

 

[BellaB18]

I have been concerned for a little while about all of this, in many area's. It has been so easy to purchase on line and we give away our details without a thought at the time - but now as an after thought "How stupid have I been?"especially with these recent information leaks of very large company's we have trusted with so much dedication , (and still do?). However it is done now and we cannot take back the records held by these companies -who may and could get hacked at any time. Do you buy on line??

You are so right Cathyann,
Yes l do buy on line. I have never done anything with financial companies and never will.
But yes purchases. I stayed away from a mobile phone for years until my husband insisted l have one because of falls fair enough. No e-mail for years then finally gave in and no shopping on line but then of course with my lack of mobility found it a blessing. Sadly it's really a huge risk now. We can only do the best we can and be on guard keep our security up and be suspicious of things that pop up. Sad world we live in. All the modern stuff does have its draw backs.
Kind regards Vicki

 

[Andrew]

I went to the bank to withdraw cash from the ATM using my wife's card. The machine broke down and kept the card. An assistant came over to help and asked for my I D. She then retrieved the card, but would not return it to me. I had to go home, get my wife and her passport to prove who she was and owned the card. This was despite some staff knowing me and us having the same surname.

 

[BellaB18]

I went to the bank to withdraw cash from the ATM using my wife's card. The machine broke down and kept the card. An assistant came over to help and asked for my I D. She then retrieved the card, but would not return it to me. I had to go home, get my wife and her passport to prove who she was and owned the card. This was despite some staff knowing me and us having the same surname.

Unreal you poor man you would feel like a criminal. Even though the teller knew you.

 

[June E]

I went to the bank to withdraw cash from the ATM using my wife's card. The machine broke down and kept the card. An assistant came over to help and asked for my I D. She then retrieved the card, but would not return it to me. I had to go home, get my wife and her passport to prove who she was and owned the card. This was despite some staff knowing me and us having the same surname.

Your wife’s card could have been stolen ! I’d have been glad the bank was on the ball stopping a thief emptying her account

 

[Veggiepatch]

I went to the bank to withdraw cash from the ATM using my wife's card. The machine broke down and kept the card. An assistant came over to help and asked for my I D. She then retrieved the card, but would not return it to me. I had to go home, get my wife and her passport to prove who she was and owned the card. This was despite some staff knowing me and us having the same surname.

That's strange! I had my card swallowed by a CBA ATM and when I asked for my card to be retrieved, no staff were permitted to access the ATM, including management. Only people from Armaguard, Chubb, Prosegur, etc, have access to the internal workings.

And I am a CBA customer!

 

[Tootie]

I sold my previous property and purchased my current one in the past 8 months, and yes, when I queried my lawyers who did the conveyancing, I was told they legally must identify us by way of passports, driver's licence, voice, appearance both photo and video, all done online, reportedly secure. I was also very apprehensive about financial details being given online, for settlement funds to be paid into. PEXA is the way it is done nowadays when you sell and/or buy real estate. Ah, for the good old days when cheques were the norm for these transactions!

 

[GillyH]

I went to the bank to withdraw cash from the ATM using my wife's card. The machine broke down and kept the card. An assistant came over to help and asked for my I D. She then retrieved the card, but would not return it to me. I had to go home, get my wife and her passport to prove who she was and owned the card. This was despite some staff knowing me and us having the same surname.

I would be happy they followed procedures.

 

[ARL]

Identification requirements are excessive and unnecessary. A single photo ID should be sufficient. I have had one organisation enter my birthdate incorrectly I cannot get it corrected because all my ID has a different birthdate to that the organisation recorded. All attempts have been ignored.
Privacy requirements ate also ridiculous, as I have been refused my own information.

 

[Phantom55]

My goodness Noel is pointing out the obvious that l have not thought about. As in the scammers how they get away with so much as he pointed out all the identity we have to go through. I am going through that now applying for my husband to be my full time carer, with Centre Link. I have been on DPS payment for quite a few years and my husband has been receiving the carers allowance for the same amount of time. Now he has stopped working to be my full time carer we are applying for the carers payment. Even though they have all our ID. We still have to present our driver's licences marriage certificate birth certificates and Medicare cards also his tax assessment for the last financial year. How do the people who do the wrong thing and steal from centre Link do it.
I suppose because we are honest people we would not even think about doing the wrong thing let alone how to go about it. I am so grateful we are able to apply for the financial help we need. There is no guarantee my husband will be accepted even though we have dr's reports and so on.

Kind regards to all Vicki

its possible the scammer has a better chance of success with c'link....I sometimes think that sometimes honesty is not the best policy

 

[Towing]

People who get caught have to pay the money back, are hit with hefty fines and go to gaol.

My goodness Noel is pointing out the obvious that l have not thought about. As in the scammers how they get away with so much as he pointed out all the identity we have to go through. I am going through that now applying for my husband to be my full time carer, with Centre Link. I have been on DPS payment for quite a few years and my husband has been receiving the carers allowance for the same amount of time. Now he has stopped working to be my full time carer we are applying for the carers payment. Even though they have all our ID. We still have to present our driver's licences marriage certificate birth certificates and Medicare cards also his tax assessment for the last financial year. How do the people who do the wrong thing and steal from centre Link do it.
I suppose because we are honest people we would not even think about doing the wrong thing let alone how to go about it. I am so grateful we are able to apply for the financial help we need. There is no guarantee my husband will be accepted even though we have dr's reports and so on.

Kind regards to

 

[ARL]

its possible the scammer has a better chance of success with c'link....I sometimes think that sometimes honesty is not the best policy

The security measures of government agencies sre not good.

 

[Ezzy]

Computers & all the programming that go with them was suppose to make life easy for us but has now become the bane of our everyday lives with scamming & people stealing identities just to mention two.

 

[marni]

I have been concerned for a little while about all of this, in many area's. It has been so easy to purchase on line and we give away our details without a thought at the time - but now as an after thought "How stupid have I been?"especially with these recent information leaks of very large company's we have trusted with so much dedication , (and still do?). However it is done now and we cannot take back the records held by these companies -who may and could get hacked at any time. Do you buy on line??

Even showing your licence or putting it through a machine just to enter a club in nsw. We are so gullible

 

[BellaB18]

Even showing your licence or putting it through a machine just to enter a club in nsw. We are so gullible

So true.
Kind regards Vicki

 

[ARL]

Computers & all the programming that go with them was suppose to make life easy for us but has now become the bane of our everyday lives with scamming & people stealing identities just to mention two.

Computers are not the problem. The problem is lack of regulation and consumer education. The same is happening with AI, our government is doing nothing, and will wake up when it is too late, with the genie out of the bottle.