Why Burden the Poor in the Name of Compliance?

Sivaramakrishnan A By Sivaramakrishnan A, 3rd May 2014 | Follow this author | RSS Feed | Short URL http://nut.bz/3ti1ol-v/
Posted in Wikinut>Writing>Society & Issues

Instead of targeting the few who are out to exploit the loopholes in law, new compliance requirements in banking make life needlessly difficult for the majority whose needs are basic.The cost burden and time needed make the poor poorer while the rich are hardly touched in the end.

Line of Least Resistance

Being in the finance field I have been facing new rules and regulations that are supposedly aimed at plugging the loopholes but end-up further impoverishing the poor. It is take it or leave it – making them run from pillar to post in desperation. A transaction of few thousand dollars cost much more than for the millions that the rich manage at lower costs or even free of charge! Ironically, I have seen the full range of the spectrum – from paying exorbitant fees for myself while negotiating for zero costs for the already rich. The refrain is always banks compete to get business from the rich while it is take it or leave it for the majority poor; in the end it may well prove the classic adage - killing the goose that lays the golden eggs!

I have paid $50 dollars to transfer $1,000 while it is free if the amount is large enough; then there is the matter of discrimination in exchange rates. While bigger amounts are quoted at almost same buying and selling rates, the majority pay more than one percent rate difference plus the Telegraphic Transfer charges that are waived for larger amounts! Are the super-rich so pathetic that they need freeloading all along? Should it not be the other way around, or at least all are treated equal?

Compliance – Name of the Game

The compliance needs in the banking sector are increasing – in fact everywhere. I remember opening an account with a multinational bank thirty years ago. I pleaded that I did not need it but the customer service officer coaxed me to open all the same as the amount did not matter. Now the same bank has sent a terse letter saying my account has to be closed as there are limited transactions and they have given an ultimatum that they will unilaterally take action to close the same within a certain period! Now I have to produce document after document to maintain the account in the face of ever changing rules and regulations! The officers plead helplessness as they are only meeting the compliance requirements.

The background to the new steps are to prevent money laundering – a goal that I cannot dispute. However, the big guns find a way out anyway – so why go after a soft target and make life difficult for them? The same financial institutions that pay billions of dollars as fines when America nails them thumb their noses at others, especially the poor countries without clout. In fact, they have advisers all along depending on the wealth at disposal to find a way to help the wily ones have their way; anything is possible depending on the amount involved; there are the loopholes in law and the tax havens!

Game Changing Realities

I remember helping an elderly gentleman with his banking request. He was prompting me to emphasize to the bank that he was one of their earliest customers when they opened their banking operations little realizing that times had changed. Now it is only the documents that speak and not the person! I agree to the change but not the discrimination against the majority poor or the blatant favoring of the rich.

It is clear there is a concerted move to disadvantage the poor and it leads to the rich becoming richer at their cost – no wonder the poor are getting poorer by the day when they face such hostile discrimination. I have paid $25 monthly when balance in my account fell below $3,000 and it got to a point I had to close the account. The bankers view is it in uneconomical to have such accounts. Is it not ironical that this lame excuse is proffered when they have computers to generate and maintain the accounts or even to waive the printed statements?

Unconscionable Path

Sadly all these are taken as par for the course but they revolt against conscience, fairness and equality. The society is just unfair if these are not questioned. I always maintain that the rich become richer not through their ability but taking advantage of an accepting poor. I will go to the extent of saying they should hang their heads in shame in exploiting the system and the poorest who bend over backwards to pull through each day. The rich are not smart but just blind to their unfair actions exploiting a believing and forgiving public.

Get Priorities Right

I truly wish our leaders set right the grotesque daylight robbery of the poor than losing sleep over issues that matter little to the 99%. Leaders should fight injustice to the extent of favoring the poor and the returns will be reflected in the general uplifting of society. A society that closes its eyes to the travails and injustices will fight to exist, leave alone find meaning. Banking is a basic requirement and the needs of the common citizens should not be exploited for profit motive. They may not have a separate voice but the injustice perpetrated will leave a scar in the collective conscience. It is time the law shows its bite by controlling those who are out to exploit and the poor are nowhere in this game of outsmarting the law leave alone doing anything to harm the society they depend upon. The lawmakers should know who should be their targets and not lose time and money going after those who want to be left alone in every way. When every financial crisis is brought about by greed but ends up impoverishing the poor who also foot the bill ultimately and even enriching the already rich, is it not time to open our eyes?

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Tags

Burden, Compliance, Equality, Fairness, Financial Crisis, Grotesque, Pathetic, Poor, Priorities, Reality, Resistance, Robbery, Rules And Regulations, Society, Spectrum

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author avatar Sivaramakrishnan A
Professional accountant. General take on life, business, international news comments

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author avatar Sivaramakrishnan A
3rd May 2014 (#)

Thank you Johnnydod for your moderation - siva

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author avatar Stella Mitchell
3rd May 2014 (#)

It sounds very much like ...Biting the hand that feeds you ...dear Siva . The only trouble is though , the ones who can do the biting now , can own their own Supermarkets . ...the same places where the ' hand-less ' ones have to sleep outside . It's all so wrong .
Thank you for sharing this with us my dear friend .
May God always bless you
Stella ><

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author avatar Sivaramakrishnan A
3rd May 2014 (#)

Thanks Stella for your support. The majority law abiding citizens are treated as a nuisance when greed takes its toll on society - siva

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author avatar cnwriter..carolina
3rd May 2014 (#)

oh so right on is this Siva...i have run into all the stuff banks need or so they say and it is ridiculous..also the interest on our money compared to that which they charge to borrow from them (which is not their's anyway) is beyond comprehension except for their greed factor..but when the big bang comes they will be very sorry I am sure...many thanks for this

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author avatar Sivaramakrishnan A
3rd May 2014 (#)

Thanks Carolina for your input. I am witness to how ordinary folks are treated as non-entities as if they are responsible for the various scams. It is clear injustices are rampant and the reverse Robin Hood syndrome plays havoc especially in the banking sector. Ordinary accounts do not bring in profit according to their flawed theory but at least they don't bring down the house like by those few who play with others' money and take to their heels when the chickens come home to roost! siva

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author avatar wonder
3rd May 2014 (#)

So much information shared, thanks.They threaten to close our accounts without prior information sometimes.They are the ones who are creating so much imbalances in society, I see.

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author avatar Sivaramakrishnan A
3rd May 2014 (#)

Thanks Wonder. Banking is impersonal when ordinary folks are involved. Rules are changed mid-way and slanted against them with take it or leave it attitude - siva

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author avatar Connie McKinney
3rd May 2014 (#)

Unfortunately, our government always sides with the rich. Their greed nearly brought down the entire U.S. economy in 2008.Yet, no banker was ever prosecuted; instead, they got a nice, generous bailout. Yet there is never any money to help people at the bottom and the middle of the economic ladder'.
As always, this is well written and thought-provoking, Siva.

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author avatar Sivaramakrishnan A
3rd May 2014 (#)

Thanks Connie. Paper profits are en-cashed by few but the losses are on public account. There was a case filed in Asia by a well known multinational bank against a big player (punter?) in foreign exchange on various deals claiming $1 billion on account of losses incurred by the bank. The client counter sued that the bank was responsible for the losses as they had misled him. Finally it was settled out of court and the bill was finally on you and me! siva

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author avatar Delicia Powers
3rd May 2014 (#)

In this unbalanced treatment the gap ever widens- financially and emotionally...thank you Siva for this heartfelt report...

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author avatar Sivaramakrishnan A
3rd May 2014 (#)

Yes Delicia, many take these as par for the course but it revolts against my conscience. When a transaction of $1,000 costs $50, it should translate to $50,000 on $ 1 million but the rich gets it free! Some have to do many transactions for smaller amounts at a time and do they not add up? siva

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author avatar Randhir Bechoo
3rd May 2014 (#)

Interesting article.Its really sad the poor and working class society have to face these fees.

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author avatar Sivaramakrishnan A
3rd May 2014 (#)

Thanks Randhir. Banking is no more a service extended to the poor as they are supposed not to bring in revenue. Agreed to an extent but they do not cause losses either. My point is for fair treatment - siva

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author avatar M G Singh
3rd May 2014 (#)

Dear Siva, this is capitalism. Sometimes I feel a spellof communism ids good for a nation

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author avatar Sivaramakrishnan A
4th May 2014 (#)

Yes Madan, I was in charge of a company in Kerala when the communists rode roughshod and 99% of my time was spent on appeasing the trade union leaders! We do not appreciate our sun when it shines and take the hard-earned democracy and freedom for granted especially those who are out to exploit the trusting majority. China is putting away the small fish so that the biggest will be exposed soon, but the act of voting is considered democracy in India and other countries while the levers of power remain with few whoever is in power. Suharto was considered a dictator in Indonesia but he built great infrastructure - now they enjoy the festival of democracy, but many yearn for his iron-clad rule!

When the system allows few to enrich themselves at the cost of the poorest of the poor it is time for overhaul lock,stock and barrel - siva

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author avatar Steve Kinsman
3rd May 2014 (#)

This is such a sad state of affairs when the rich are pampered and coddled while the banks try to extract every last dollar belonging to the rest of us. Madan is right - this is the nature of capitalism, and the selfishness and greed of the elites is like a drug to them. Capitalism must end and be replaced by an economic system that works for everyone, or both we and the planet are doomed.

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author avatar Sivaramakrishnan A
4th May 2014 (#)

Thanks Steve. When the system fails to curb unbridled greed, it is time to take a hard look. It has survived more due to the forgiving nature of the majority despite injustices heaped on them by the greedy few and nothing seems to satiate them! When power is equated with wealth, as the media tries to highlight, then that is not democracy in action. Nine cannot keep enriching the one - siva

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author avatar cnwriter..carolina
3rd May 2014 (#)

just shared on Twitter and Linkedin

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author avatar Sivaramakrishnan A
4th May 2014 (#)

Thanks Carolina - I appreciate your support as always and for going the extra mile - siva

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author avatar cnwriter..carolina
3rd May 2014 (#)

carolina ‏@cnwriter
http://nut.bz/3ti1ol-v/ Why Burden the Poor in the Name of Compliance? by Siva #poverty #rich #banks #thieves #corruption #poor

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author avatar Sivaramakrishnan A
4th May 2014 (#)

Noted. Thanks again Carolina - siva

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author avatar SS Kumar
3rd May 2014 (#)

nice read!

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author avatar Sivaramakrishnan A
4th May 2014 (#)

Thanks Kumar for your support - siva

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author avatar Carol
4th May 2014 (#)

Banks make so much money out of all of us, and sometimes when I want to access some of my savigs, they make me feel as if it's not my money at all. Thanks Siva for another very interesting write.

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author avatar Sivaramakrishnan A
4th May 2014 (#)

Thanks Carol for your input. My banking accounts started over forty years ago and I assumed I could just deposit and withdraw anytime. Now they ask for identity documents all the time to update their records. Since I have a joint account I had to plead that the utility bill comes in my name only and I do not have a separate bill in my wife's name. Finally it went to their legal department to sort out this issue. Why doubt old timers - accounts that existed before the dreaded 9/11?

My pleading is to leave out small timers like me who want to maintain account just to meet basic requirements - no assets, no liabilities - the perfect balance to leave this world in peace! siva

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author avatar Carol
4th May 2014 (#)

sorry I meant savings.

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author avatar Sivaramakrishnan A
4th May 2014 (#)

Thanks - noted - siva

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author avatar Ptrikha
6th May 2014 (#)

And why not all us commoners(and middle class folks, if we come in that category) meet up, stand up , and raise voice against such practices?

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author avatar deepa venkitesh
6th May 2014 (#)

Right now in Kerala, all workers are mainly from West Bengal or Orissa. They earn high daily wages and remit huge amounts weekly to their respective states. As for Kerala natives, most of them are too egoistic to work. The new generation is too fashionable. The people have had to stop agriculture because no native is available to work and those from outside are not reliable. A very sad state of affairs but this was brought about by these so called union leaders whose next generation are now too educated to work as laborers.
As for banks, we know only too well, we had applied for an agriculture loan and to remit it, I had to pawn my gold because of the huge interest rates in spite of remitting it in due time.

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author avatar Sivaramakrishnan A
6th May 2014 (#)

Thanks Deepa - my main plea was to leave out the 99% and go after the 1% who are the real culprits everywhere. What has the 99% to do with the looting going on and to meet compliance after compliance? Many are like me, pay more than needed - plain karma in action!

I know the condition in Kerala very well. Kerala had the first elected communist government. While in charge of a company nearly forty years ago, all my time was consumed by dealing with union leaders from the local mafia to the very top. To stay relevant they put relentless spokes. Finally, many workers had to leave for Middle East countries to work in hostile environment with zero labor protection! And many stayed their adult years alone and returned as strangers to own families!

The communist leaders are dreaming talking of a hoary past while their master, the Chinese, have moved on even ahead of America. As per some calculation they are on the brink of overtaking America as the largest economy of the world. If our communist and union leaders visit China, they will be given black tea and sent packing. They just have no time for idle talk.

We talk about democracy but it is ironical Chinese leaders have their ears to the ground and respond with kindness but also ruthlessness when needed. Muslim countries like Indonesia and Malaysia counter terrorism without mercy while we fight with hands tied behind our backs due to crippling politics and appeasement. It is true - we get what we deserve but the 99% deserve much more provided they assert than losing themselves in trivial pastimes. We need the right sense of national pride to progress but we expect a higher force to intervene on our behalf to clear up the mess we create - plain wishful thinking. We are not teenagers expecting our mothers to back up for our foolishness! siva

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author avatar vandana7
10th May 2014 (#)

Will you believe, similar thing is also happening in the East Coast, more specifically in Godavari basin? And we are all not too highly educated either.

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author avatar Sivaramakrishnan A
10th May 2014 (#)

Thanks you Vandana. It is now reverse Robin Hood. The powerful negotiate at the highest level while for the 99%, it is to sign on the dotted line! siva

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author avatar Sivaramakrishnan A
6th May 2014 (#)

Yes Ptrikha, we should make a united stand cutting across country borders through use of technology like social networking. French economist, Thomas Piketty, has highlighted the inequality of the capitalist system thus opening the eyes of the world to the fact how wealth begets wealth. It is high time our leaders fixed the flaws before it is too late. There should be rewards but they should be just for sustainability and equity - good that the awareness is spreading - siva

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author avatar Kingwell
6th May 2014 (#)

This is so sad Siva but it seems to be happening everywhere. There was a time when we had statesmen, now we have politicians.and the latterhas

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author avatar Kingwell
6th May 2014 (#)

Sorry about that, I was saying that politician has become a dirty word. Maybe what we need in democratic socialism, but in any case we need honest people in government not someone who can be bribed by big business. Blessings.

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author avatar Sivaramakrishnan A
7th May 2014 (#)

Yes Kingwell. We need leaders who have the honesty to stand by their promises and to fulfill them. They have a mandate from the common citizens, so why kowtow to others including those who are defeated in the elections? siva

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author avatar WOGIAM
6th May 2014 (#)

I feel your passion in your writing. A pity that those who are supposed to be in authority misuse their powers and position while the masss experience hardships.

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author avatar Sivaramakrishnan A
7th May 2014 (#)

Thanks Wogiam. Few take a stand it has always been like this, but everything has a time and place. The common citizens are running out of patience as the rich are getting richer at their cost. It is just not right by any yardstick, totally unjustifiable - siva

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author avatar vellur
7th May 2014 (#)

It is always the same story the rich become richer by exploiting the poor, when will things change for the better? I really wonder. Great article, as always.

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author avatar Sivaramakrishnan A
7th May 2014 (#)

Thank you Vellur. No harm in getting richer but not by exploiting the already poor who are the most vulnerable and trusting - siva

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author avatar vandana7
10th May 2014 (#)

I think rich remitting monies should be charged at considerably higher rates because they are depleting national reserves.

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author avatar Sivaramakrishnan A
10th May 2014 (#)

Thanks Vandana for your take. At every level the smaller amounts attract more in terms of percentage of amounts involved. Sadly, the cost of compliance works higher for the poor as they have to pay fees that cannot be negotiated unlike the rich - siva

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author avatar Subra
7th May 2014 (#)

One of the serious misgivings of capitalism and banking regulations is that, as you have correctly put it Siva, the rich get richer and the poor poorer! Yes too many procedures and regulations stifle the common man as he goes about his bank transactions. The bank justifies its actions by saying that it's done to thwart computer frauds, hacking etc. True the big rich guns are let loose and I suppose this is one of the cruel anomalies of the banking system throughout the world.

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author avatar Sivaramakrishnan A
7th May 2014 (#)

Thanks dear Subra for your understanding. Accounts opened decades ago, with few thousand dollar transactions, are also treated with suspicion; but why go after them to produce documents after documents, some even notarized, at regular intervals? Now letters come unsigned with notation - signature not required - that they will take action to protect their interests by closing the accounts unilaterally! It is only fair that the efforts should be to go after the big fish as behind every fortune there is a crime!

Thomas Piketty, the French economist, has highlighted the injustices of the much touted capitalist system. His book, Capital in the Twenty-First Century, highlights increasing concentration of wealth among few. I pay $50 to transfer $1,000 in foreign exchange while the rich get it free for millions! What choice does a common person have with even one account proving a luxury. I have paid $25 monthly when the balance fell below $3,000! It is sad when society closes its eye on these patent injustices and financial institutions are after those who extract their pound of flesh every time! It is like he who pays the piper calls the tune but the irony is - payment is made by the most deprived squeezing blood out of stone! Why should higher exchange rates be applied for smaller amounts? After all there are many such transactions though I agree there are charges for transfers but why waive them for the rich? I had highlighted these for many years but now Thomas Piketty has taken my argument to a higher level for the whole world to listen to and applaud. Let us not gloss over these fault lines - siva

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author avatar Md Rezaul Karim
8th May 2014 (#)

In simple words.. the society is saying 'go poor people go to hell'. The rest the rich will enjoy the world. But without the poor what is the value of the rich? Seem like countries are trying to be rich by killing all the have-nots.

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author avatar Sivaramakrishnan A
8th May 2014 (#)

Thanks Karim. No one begrudges the rich for their success but the rewards should not further deprive the poor. Being in the finance field I see gross injustices like American foreign account holders are divulged to their tax authorities readily while the same financial institutions will not do it for other countries! Do I have to say more about their double standards? Greed will lead us to our doom if not checked now - siva

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author avatar Helen Thomas
9th May 2014 (#)

Thanks ~ Siva ~ for another thought-provoking, well written article. What initially comes to my mind is the statement in 2 Timothy 3:16 which says all Scripture is given by inspiration of God and is profitable for correction and instruction". Also 1 Timothy 6:10 which says that "the love of money is the root of all evil."

Accepting those two references as absolute truths, I'm convinced that until the leaders in business, government, and academia, have a change of heart, those injustices will likely remain.

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author avatar Sivaramakrishnan A
9th May 2014 (#)

Thank you Helen for your input. Wealth should be our slave but, sadly, it soon becomes the other way around as greed clouds our vision. Greed begets greed in a world that tags a price for everything including justice.

Still the majority plays by the rule despite the odds stacked against them like what I have written in this post. Our leaders prove toothless constrained as they are by the system - siva

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author avatar n.c.radomes
12th May 2014 (#)

I pray to God to help you be in a place in government where you can help the small, poor and downtrodden rise from the filth and squalor to a much better life of 3 square meals each day. I appreciate your expose. Kudos and keep up!

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author avatar Sivaramakrishnan A
12th May 2014 (#)

Thank you Radomes for the sentiments expressed. There is no virtue in becoming rich from a poor country. It only shows they have looted the gullible and trusting and they are the 99%. One finds God in the smiles of the poor people. We need to keep at this expose so that the tipping point of wisdom is reached soon - siva

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author avatar Mariah
18th May 2014 (#)

I endorse nc's comment, you are indeed a voice for the unfairly treated and the downtrodden.
Money is indeed the root of all evil..the banks are all on the same page now, if you are not a major investor then your business doesn't mean a hoot to them.. but of course they are happy to charge us for the privilege.
Excellent presentation as always Siva, and my apologies for the delay in reading my friend.

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author avatar Sivaramakrishnan A
18th May 2014 (#)

Thank you Mariah. I have seen the slant against the ordinary people in banks' dealings with them and how they kowtow to the whims of the rich. Finally, the 99% foot the bill when the 1% leave them in the lurch! The way they ask repeatedly Know Your Customer forms etc is downright insulting to the poor who have measly accounts and occasional transactions for their bare needs. I have received letters (threats?) that they will close my account if I do not provide them the documents forthwith. And this account was opened thirty years ago. Why not just leave us alone and probe further when the transactions are of such value to merit such suspicion? Why not just exclude the small fish and ask the rich how come their amounts keep increasing by the year? siva

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author avatar Teila Tankersley
19th May 2014 (#)

You are a brilliant writer.

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author avatar Sivaramakrishnan A
22nd May 2014 (#)

Thank you Teila for your support and encouragement - siva

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author avatar Phyl Campbell
28th May 2014 (#)

So true, Siva! I rail against this problem all the time!

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author avatar Sivaramakrishnan A
28th May 2014 (#)

Thanks Phyl for your support as always. The 99% have very basic needs and it is waste of time and money not only for them but also for the banks to go after them - siva

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author avatar vandana7
29th May 2014 (#)

I know how it is...we opened an account for aadahar. According to rules, we need to pay just 1000 bucks, but the lady made me pay 2000 bucks saying rules have changed...like hell they have, the following week I took my maid for opening a bank account for her and they took only 1000. Now we are in limbo...should we close the account or continue it...will aadhar thing come..have about 4000 bucks there, but does seem unfair that bank will pocket it if the account is not being used. Or trouble me till i give up.

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author avatar Sivaramakrishnan A
29th May 2014 (#)

Most are like you Vandana, caught in a trap. I just cannot understand the logic behind such rules. Why trouble those who have only basic needs? It is so easy to have a basic account without all these detailed Know Your Customer forms and they apply to only those with large transactions or those having high volume dealings. Just because of 1%, why burden the rest? Commonsense is not common with those who make these rules - siva

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author avatar Retired
15th Jun 2014 (#)

Banks in my opinion have always been unfair. They show more favor to the rich by making them richer.

In the past, banks shout it out that you need a collateral to get a loan.

Now I have the collateral, they have given me another excuse why I can't get a loan. Pathetic!

Thanks for voicing your opinion.

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author avatar Sivaramakrishnan A
23rd Jun 2014 (#)

Thank you Hotnicey. Sorry to read you are also a victim. Sadly, banks bite the hands that feed them. Being in the finance field I have seen it all - how they bend backwards to please the mighty - those with power and money but lack compassion and empathy. And on top, the rich wonder how the poor can be happier than them! Compliance is more for the poor. It is so much better for all if financial institutions leave out those with basic needs from all these rules and regulations than what they do now - targeting them with iron fist - siva

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author avatar LOVERME
11th Jul 2014 (#)

sad how did they miss ur STAR???
spoilt your hats tricks continuity ...
suggest you modify and resubmit it
...my LORD

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