Saturday, October 19, 2013

Just How Nefarious Are the New Wire Transfer Restrictions at Chase Bank?

An EPJ reader responds to my advice to pull money out of the banking system as a result of Chase bank's new restrictions on international wire transfers:
I'm a fan and lewrockwell reader. Just wanted to let you know that I received one of these notifications from chase for my small business account. I called my banker and asked him what the deal was. I was told it was due to a new government regulation and that they could upgrade my account (for $95/month if my balance falls to under $100k with 4 four free international wire transfers per month). No restrictions on cash or wires. I told him to upgrade me. That's all it took (no email verification or signature). Basically it looks like this new gov regulation just requires the banks to verbally verify the account upgrade and once you do the restrictions are lifted.

I don't trust chase or any of the large banks and I try to keep as little cash in those banks as I can, but it seems like this is not as nefarious as I originally feared.

Anyway, just thought you might be interested. I really enjoy your posts and appreciate the info you get out to the public.
I would argue that it is more nefarious than just blocking accounts from international wires. Keep in mind that President Obama brought into his administration during his first term the very smart but very evil Cass Sunstein.

This is what I wrote about Sunstein back in August 2011:
 Cass Sunstein, author of Nudge, believes in, well, "nudging" people in directions the government wants you to go in, through limited "choices". 
He is not in favor of "forcing" people in any one direction but providing limited "options" that push people in the direction he wants them to go. The TSA experience at airports  is an example, you do have the "option" of opting out of going through a body scanner, but this doesn't mean TSA harassment stops, it just becomes more aggressive. First, they make a big scene about your opting out, then they grope you. Sunstein set the TSA program up to nudge people to choose the scanner.

As far as the Chase account changes on wire transfers and cash withdrawals, they are right out of Sunstein's playbook. They do give you an option to change your account, but the default option is for things to stay the way they are, that is, the option that will prevent you from sending international wires and making large cash withdrawals.

Here is Sunstien in his book, Nudge, on default options:
Many organizations in both the public and the private sector have discovered the immense power of  default options[...]note that not all defaults are selected to make the chooser's life easier or better.
Most account holders probably aren't thinking about some panic period when an international wire may be desired. Some busy account holders probably never even read the letter.

I doubt the Chase letter resulted in more than 1% of account holders changing their status, certainly not more than 10%.  If this regulation is to prevent withdrawals overseas during a mass panic, then it is a major Sunstein-type "success." Because during such a panic, most account holders will have to, as the EPJ reader notes:
Basically it looks like this new gov regulation just requires the banks to verbally verify the account upgrade and once you do the restrictions are lifted.
Good luck trying to get Chase on the phone during such a panic. Government officials will come in during such a period and tell bank employees to go very slow and make sure everything is in order with an account, everything before they can go on to the next account. That's why you see lines at bank panics. Think about it: Does it really take so long for a tellers to count out money that people need to bring lawn chairs to wait for their own money?

I have talked to bank managers at banks that have experienced runs and the government comes in and makes sure the bank employees are going very slow and making sure account holders fill out all forms in front of them in their entirety before they go on to the next customer.

If people really start to panic and attempt to send international wires via their online accounts, they will have to change their account status via phone and that is going to be when the phone lines will be jammed.

But Chase, will be able to say, to avoid lawsuits:
 Hey, we sent you a notice about changes in your account status in October, 2013.
Two more points. In my initial post, I wrote:
There are apparently some workarounds relative to these policies[...]Totalitarians don’t take away all your freedoms at once. They do it in incremental measures. 
My warning was not so much that all avenues of money withdrawal are being cut off now, but that they are starting to be cut off. It is only in the early stages of such cut offs that you still have enough freedom to make the necessary moves. I again suggest viewing, especially the first half of, the movie The Pianist,  to understand how many Jews ended up in gas chambers by shrugging off early totalitarian measures. Instead, of adapting to the new measures, they should have been long gone.

Second, I note the EPJ reader makes a distinction between big banks and small banks in the United States.  Don't be lulled into a false sense of security because  you are not dealing with a major bank. The USG, through various agencies, has all US financial institutions under its thumb. There is no special safety because you are dealing with a small bank or credit union, your money needs to be outside the system.


  1. Bob - that all makes sense but I will simply point out that in a panic the govt. Will likely ban all transfers regardless of account status.

    1. That is exactly my point. Things will only get worse from here, take precautions while you still can.

  2. Further to your reference to "The Pianist", I worked for many years in the early eighties for an older Dutch Jewish man, whose family had owned a hat factory in Holland pre WW2. They saw what was coming and started to try to sell the factory but it took much longer than anticipated since so many people were selling companies. Finally the factory was sold for an reasonable amount based on lowered expectations and all assets were given to my boss as a young man to smuggle out of the country and start a new business in Lima, Peru. His job was to get situated as soon as possible so that all the other relatives could begin traveling to Lima in small groups and have a place to stay and begin a new life. His young wife followed him to Lima shortly after he arrived but, unfortunately, he never saw any of his other relatives again.

  3. The image in your post shows a line of people waiting to get their money out. I suspect there will be equivalent lines to buy gold, silver and bitcoin when this happens.

  4. And in keeping with the crony capitalist playbook, the new regulation offers banks a new revenue stream: ". . . they could upgrade my account (for $95/month if my balance falls to under $100k with 4 four free international wire transfers per month)."

  5. Another interesting aspect of this is that Chase is not going to any great lengths to make this upgrade option known to people. This is the first I have heard of it.
    It would not be surprising if they intended to limit the amount of time a person could upgrade their account to say, Nov 17th. Since most people might not know about the new limitation on their accounts and won't until they attempt to make a wire transfer after Nov 17 and it fails. Then the bank can claim they informed the customer and allowed for upgrades for a period of time thereby shifting the responsibility to the customer for the reason they can't move their money the way they want.

  6. Most people will retain their assets in Federal Reserve Notes not understanding that the elimination of cash transactions has already begun with the enforcement of "money laundering" laws and regulations.

  7. Anyone citing Jews and gas chambers may want to view the following documentary to make sure their citation is indeed in-line with history:

    1. "No Longer Available". I'm shocked. Shocked, I tell you.


    New foreign wire transfer regulation will be kicking in soon -- this may be the reason why Chase made its decision.

    I tried contacting Infowars, who broke this story, but my email fell on deaf ears.

    "There’s upcoming regulations that banks will face for foreign wire transfers coming up in about a month. Our little bank had to find a new provider because our correspondent left that part of the business."

  9. There’s upcoming regulations that banks will face for foreign wire transfers coming up in about a month. Our little bank had to find a new provider because our correspondent left that part of the business.

    This may be the same reason Chase is doing what their doing.

  10. Bank FREE since 91' and I'm doing just fine with CASH ONLY and the US Postal Money Order now and then.

  11. Another thing to consider: By making this the default option, people who might consider international wire transfers are forced to identify themselves to the banks and, in turn, to the U.S. Government. From a law enforcement perspective, this might be an ingenious way to thin the heard of potential money launderers. Starting with data on everyone who opted-out, you could exclude people and certain businesses who have a regular, legitimated pattern of such transfers. What remains might be a thinned out target list for increased surveillance based on someone's belief that irregular wire transfers portend criminal behavior.