Expats Left Frustrated as Banks Cut Services Abroad
This article brings to light the challenges expats are facing as a result of more stringent regulatory laws. Financial institutions are weighing the profitability of a client relationship against compliance risk and deciding that the increased reporting scrutiny and regulatory costs are not worth the relationship. As a result many institutions are refusing to open new accounts with foreign addresses and even going as far as terminating existing relationships. Many expats are being forced into finding creative ways to work around these issues.
The traditional challenges of expatriate life—adapting to a new culture, separation from family and friends—are being complicated by the tougher U.S. laws and more aggressive scrutiny of customer accounts.
It isn’t what William Hart expected when he moved to Berlin from North Carolina nearly four years ago. This spring, the 24-year-old e-commerce analyst said he was rejected for an online brokerage account by Deutsche Bank AG, although he has a checking account there and worked as an intern at the company. In addition, a smaller local bank turned him down for an online checking account, and he says Wells Fargo & Co., his U.S. bank, closed his brokerage account when it learned he lives in Germany.
The German banks gave U.S. regulatory changes as the reason, he said. A spokeswoman for Deutsche Bank and a spokesman for Wells Fargo declined to comment.
“I seem to exist in a no-man’s-land,” said Mr. Hart. “Can it really be that expats are facing such massive obstacles in basic financial matters?”
Full Wall Street Journal article here.