Garfield Goulbourne | Cash is not sexy
Who likes money? The actual physical thing. What if I were to say, "Cash is not sexy!"
There was a time when men loved to impress their women by just stuffing their wallets and pockets with wads of cash. Who still does that? Don"t you have thieves in your area? Aren't you afraid of someone forcefully relieving you of same and threatening your life?
Walk with your plastic. Cash is not sexy! Here's why.
Anti-money laundering and Proceeds of Crime Act regulations set impositions on financial institutions to become fiscal police. So, dare you bring a million dollars in cash and attempt to deposit it and see what happens! As a matter of fact, as an individual, try to do a million-dollar cash transaction with any establishment such as a car mart. See what will happen! For example, travel with your millions to buy a car and see if you might not just get arrested.
Cash is not sexy! Anti-money laundering and POCA regula-tions seek to impact especially organised criminals who conduct business outside the formal financial system but then ultimately seek to wash and clean money earned through drug smuggling, prostitution, human trafficking, and lottery scamming through the banks and other financial houses. It is for the reason of hindering money-laundering activities why officers of financial institutions seem to be investigative reporters when you visit to open accounts and deposit monies. Cash is not sexy!
Financial companies are mandated to establish proper KYC (know your customer ) procedures, wherein non-adherence to this requirement could land officers of an institution in jail (usually three years upwards) and a shutdown of same institution.
The truth is, it doesn't even have to be a million dollars you are depositing for financial houses to refuse your deposit. Once you are making a cash transaction that is inconsistent with your normal deposit activities, same can be considered a suspicious transaction, wherein, again, first, the financial institution may choose not to accept the deposit, or the same institution may take the deposit, and through the organisation's nominating officer to the Bank of Jamaica (BOJ), file a suspicious report. A suspicious transaction report may even be filed for as small as Jamaican $50,000. Cash is not sexy!
What about foreign-currency notes? Same problems? Well, have you tried depositing more than US$500 at your commercial bank? What were you told?
I know of a case where a customer pulled US$6,000 in cash from her bank to do a US-dollar investment with an officer at another institution. She got the cash against the officer's recommendation to take a cheque on the premise that she wanted to avoid the charge for the cheque against no fee for cash withdrawal. Naturally, Proceeds of Crime Act (POCA) & Anti-Money Laundering (AML) regulations required the officer to request of the customer evidence of source of funds, which she had to provide.
In addition to deposit-threshold impositions, as an individual, one would be charged a percentage fee for banking above US$500. Financial institutions will tell you that they levy a fee on US-dollar deposits by virtue of US funds collected having to be returned to the US Treasury, which is a cost to the financial institution; same cost is subsequently transferred to the customer.
Here's an example of fee calculation.
If you have US$6,000 cash deposit.
US$500 is the amount allowable without a fee levied.
Hence, the difference of US$5,500 will attract a 2.66 per cent fee at a particular institution.
5500 @ 2.66% = US$146.30 fee (approximately J$19,000 for depositing US$6,000).
It would have been cheaper to get a cheque or do RTGS (real-time gross settlement)/ bank-to-bank transfer. Doesn't this make you also think that cash is not sexy?!
Some of you may then say you will go back to saving under your bed/mattress, but what about the kleptomaniac family member who can't wait until you are gone to 'fingle' your money?! Likewise, what if there is a fire and your monies get burnt up? There is no recourse for cash destroyed or stolen in those situations. Therefore, I would encourage you to use point-of-sale machines, bank and credit cards, cheques, bank-to-bank transfers instead because indeed, cash is just not sexy!