15 Nov 2013

Trouble Withdrawing Money From Bank Account?

Banking 12 Comments

I know someone who is selling a (modest) house. He is concerned that he won’t be able to take the money out of his checking account and turn it into cash. Has anybody done this recently, who would like to share the experience in the comments? To be clear, he doesn’t want to do anything illegal with the money, he just doesn’t trust it sitting in his bank account because he is spooked by the economic environment.

12 Responses to “Trouble Withdrawing Money From Bank Account?”

  1. Silas Barta says:

    I hate to be the off-topic guy, but, if you’re worried about your money being in a bank, you should also be worried about it being USD…

  2. Greg Morin says:

    There’s no issue taking it out, although taking it out in cash would raise a few eyebrows I imagine (and be unwise… you really don’t want to get pulled over with tens or hundreds of thousands in cash in your car in a civil asset forfeiture state).

    The main issue with banks and cash is putting cash INTO an account. If it’s more than $10k the bank has to report it to the IRS which in and of itself is not a problem, it’s just some people don’t like that. If you try to do it with several less than $10k deposits, well then that’s called “structuring your deposits” and is actually illegal… because it mirrors the behavior of drug dealers who do the same thing… so obviously if drug dealers wear red hats and drugs dealers are criminals, thus anyone wearing a red hat is a criminal.

    Overall they (the system of fiat currency and the government) have us all trapped. We must play by their rules if we want to move our money around. I look forward to the day when we have a bitcoin (or similar) based economy and don’t have to worry about this kind of garbage.

  3. Nathan says:

    I have heard of people being hassled by the bank manager for wanting to withdraw large sums of cash, but at the end they hand it over and file the paperwork for a “suspicious transaction”. The problem comes when he wants to buy a new house, that cash, when he redeposits it in the bank will likely be held as “suspicious” and the bank won’t allow him to use it for the down payment. At least that’s what I have heard.

    • Matt M (Dude Where's My Freedom) says:

      I’m in the process of buying a house, and I had to “justify” 20k that I recently deposited into my checking account. In my case, it was easily done by showing a transfer confirmation from my brokerage account. Not sure exactly how you’d “justify” a cash deposit…

  4. Tel says:

    If he is moving house then maybe buy the new house first (on borrowed money), then when the old one sells use an electronic transfer to throw all the money into the new loan. Should minimise the risk of sitting on cash, if you are thinking of a Cyprus-style bank “bail in” yeah I agree it could happen.

    Taking a box of cash home is pretty risky too…

  5. Anonymous says:

    If he doesn’t mind being a party of bilking the taxpayers: Tell him to open up a few separate accounts at separate banks. Each account will be insured up to $100k.

    • Nathan says:

      Two problems:
      There is a cap on total insurance for any individual.
      The FDIC only has a fraction of the funds necessary to insure bank accounts. In the event of a general bank failure there would be essentially no money to cover anybody’s losses in the banks.

      • AcePL says:

        And one more: few separate accounts will raise much, much higher red flag. And he may be audited or even arrested as a money launderer?

  6. Ken B says:

    I paid with a cashier’s check two weeks ago.
    I think he’s being a bit paranoid.
    I know, I know. TROLL!

    • Tom E. Snyder says:

      Just because you’re paranoid doesn’t mean they are not out to get you. 😉

      • Ken B says:

        The real question is if they’re out to get you *first*.

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