Posts Tagged ‘banking’

Not content with shooting one foot off with the removal of their banking secrecy, Uruguay’s parliament recently ratified (August 26) an absurd new law that bans all cash transactions over US$5000. In addition, special information will need to be filed if said money originates outside the country.

It’s funny, really, because Uruguay’s main movements in real estate for the past decade have been made by flight capital from Argentina and other countries. A couple of years back, they removed banking secrecy as it pertained to sharing information with Argentina, wherein real estate transactions and large bank deposits had to be reported to the AFIP. That wasn’t good enough, because then the deposits just started to become smaller (duh), so in order to curb this awful activity of foreigners paying Uruguayans for their land and construction labor, something must be done, a nuclear option which will screw even the locals!

Movement of any kind will not be tolerated.

Considering that many Uruguayans probably don’t have a bank account at all, let alone a debit card, and 2/3 of them live in rural areas without banks, it will be interesting to see how this pans out. I am guessing that most stuff will just go black-market, and the areas outside of Montevideo will just separate themselves more and more from the stupidity of the little Tupamaro empire.

On the 5th of February (yes, two days ago; I am starting to become South American. I’ll get to it mañana…) a fire in the Iron Mountain archive building killed 9 firemen and first responders, and injured 7 more. Despite the unnecessary loss of life, this is interesting in several ways.

First, the building had an advanced fire suppression system, built to be able to not only quench fires but keep documents intact. In addition to multiple other methods to prevent and stop fires. Seeing as it *was* an important document archive.

Secondly, this particular archive housed quite a lot of bank documents.

Thirdly, the fire happened at the announcement of new foreign exchange regulations, in which banks are now required to limit FX positions to 30% of their assets, and FX futures to 10%.

So, how convenient that the destruction of official bank balance data (at least *this* copy) coincides with new bank compliance which coincides with Argentina being called out on fudging its Forex numbers, and having the honesty of its bank reserves questioned.

“Well, we would show you, but oops, it all caught fire last night!”

More info here and here.


The news about Chase, HSBC, and others stopping international wire transfers has got quite a few businesses in a bind, including my own. The culprit, after investigation, is the Remittance Transfer Rule Amendment to Regulation E, of the Dodd-Frank Act. This regulation, like all of them, is “designed to protect customers” but in reality, fails miserably.

Summarizing the changes brought about by this crippling legislation:

Banks must now hold outgoing transfers for 30 minutes instead of executing them immediately. During this time, they are required to give the  customer disclosure information in regards to:

  • Exchange rate.
  • Fees and taxes collected by the bank.
  • Fees charged by the recipient bank.
  • The final amount expected to be received abroad, including fees, taxes, etc.
  • Disclaimers on foreign taxes and fees.

In addition, banks must now:

  • Provide a receipt with the same information contained in the 30-minute disclosure, for each transaction.
  • Provide said disclosures in multiple languages if necessary.
  • Devote additional resources to investigation of any problems with the outgoing wire.
  • Be held responsible for botched wires instead of employee incompetence.

This applies to all transactions (not just wire transfers) which:

  • Are more than $15.
  • Made by a consumer in the USA.
  • Sent to a person or company in a foreign country.

This applies not just to banks, but credit unions, money transmitters, etc, any business that sends more than 100 transactions per year. This will affect PayPal, Western Union, even ACH transfers.


…or two days in Uruguayan banks.

Actually that’s not really fair to the title, because after his two years before the mast, Richard Henry Dana was cured of his ills and much better for the experience. I do not feel cured nor better.

I went in early on Monday to deal with wiring some money to someone somewhere. Due to the amount, they wanted me to provide documentation as to the source of the funds. Which were already in the bank. OK, says I, while the girl behind the counter literally takes 2 hours to fill out the form for the international wire. “I will have to come back later with a copy,” I tell her.

“No problem,” she says, “it will be about another 30 minutes before the papers are ready and signed by the manager.”

“You mean that you are going to approve it anyways while I wait, without the papers you are asking for?”


“So why am I going to go and get them, and harass my lawyer to dig up a months-old archived copy of the bill of sale for that apartment?”

“Because we need it,” she answers.

“…to do a wire that you are going to do now, before you get the paper.”


Riiiiight. So off I go to the lawyer who did the sale documentation, and get a copy. This takes another hour or two. By this time I am worried if I will get to the bank before it closes. You see, arriving early to a bank in Uruguay means 1pm. They close at 6.

And then I go back to the bank with the documents, to wait in line for another hour or so, and hand them over. The bank closes as I am heading out the door. And I know for a fact that those papers will join others in the compost heap in the basement. What a waste of time, and this is just me, one guy. Imagine the amount of trees being wasted to provide paper which is to be wasted for time which is to be wasted, using tax money which is to be wasted, derived from human effort and wealth which is to be wasted… it’s incredible.

I didn’t have time to re-deposit the money I was going to use to buy that lot in Chile, so I’ll have to do that tomorrow. In the evening I meet with VikingBob and SwingdanceBob for some empanadas, but that place is closed, so we go to the Pizza Empire which is open, and what the hell I order Chivitos. It’s been a while.

The gardeners came this morning, saw my truck in the driveway, and left another Cayote melon they found on its hood. But they took all of my bell peppers. Which were looking nice and red and ripe. I was looking forward to eating them until I went out there to pick them and found all of them gone. Not cool. Seriously. Who the fuck does that?

Next day, I go back to the bank “early” when it opens, and deposit said money. The guy puts on his evil face when the large stack of bills hits the counter. Well, it could be constipation, or gas… either way he looks uncomfortable. Because it is over a certain amount, EvilFaceMan tells me that he needs proof of where it came from.

“You see those receipts rubber-banded to the tops of the stacks of bills?” I ask the man behind the counter.


“They have not moved since I took them from this very desk just a month or so ago.”

“Ahhhh, so they are from this bank?”

“Yes. It says so on the receipts. I decided not to buy the land, so I am putting the money back into my account.”

“OK, no problem,” his evil face flips back into happy mode.

An hour later he is done counting every bill, makes a xerox of the original withdrawal receipts for their official records (which will go into the compost heap in the basement), and hands me my deposit receipt. Then I go to the Mostrador’s desk and ask them for a copy of my entire account history going back to 2007, to be thorough, in order to overwhelm the citizenship nazis with proof that I was here in Uruguay for more than 3 years so I can get my &@^$% passport.

I look for a young, good-looking, seemingly competent person there and find one. You see, I always strike out when I get stuck with the sour, dried-out old prune ladies who view me as everything they could never have (ie: a wealthy, handsome foreigner) and therefore begin pouring on the hate like boiling pancake syrup.

This young lady hears my question, answers it, and reacts. She does so unlike the robotic, “No, you can’t do that,” PruneLady response, and so much to my enjoyment. She actually smiles! What? Her face is still intact? It didn’t break? The world isn’t coming to an end?

No, she actually finds all the back-records and prints it all out for me. Granted it took another hour because none of their machines were working, but because she is such a non-standard Uruguayan, she actually kept trying to get it to work instead of throwing her hands up in the air with an “es lo que hay.”

So there goes another wasted day of sitting in a Uruguayan bank. But my work on this planet is done.

and… “No, you can’t do that.”

I’m on a trip to Uruguay for a week in order to deal with bureaucratic bullshit that absolutely positively cannot be done remotely, like renewing the gun permits for the arsenal. Facetime. Something which I hate doing. 1 week is 1/52 of a year is 2% of a year. 2% of my year wasted dealing with asinine, petty morons in order to maintain that they steal the bare minimum. And this won’t be the only trip, I assure you. Other things are BOUND to come up, guaranteed. There is no such thing as finished business in Uruguay.

The first stop was Banco Republica, which purports to be the hands-off bank, “It’s your money, take it or leave it as much as you please, we care not,” yet fails to live up to the promise. I had a couple of tasks I needed to do: First was to get a second digital-key authentication device so that WifeBob could take care of the bill payments remotely.

“No, you can’t do that. She has to ask for it here in person.”

“Well, what if I then ask you for a second one for myself, as a spare, just in case. As you see, I am sitting here before you,” I offered an alternative.

“No, you can’t do that. You have to order it from the website.”

“So you are telling me that the bank, which issues the devices, cannot issue me the device. As I sit here, right before you, at the bank which issues them.”

Blank stare.


I go to the teller to withdraw some cash for a property purchase I am about to engage in in Chile; every time I have wired money out of the country, it has taken them weeks to get it done despite the fact that they have specific people dedicated to doing bank wires who spend all day doing nothing… a phenomenon which I have literally watched happen, in my own bizarre nature-film experience, like David Attenborough, when I stuck around, curious, and spied.

“No, you can’t do that. You can only withdraw $10,000 per day unless you are at the bank which issued the account.”

“Yes. I am at Banco Republica, right here, right now, as I stand here before you. Is my account not at Banco Republica?”

“Yes, but you can’t do that. You need to be at the specific branch which opened the account.”

“Is this a different company?” I ask.

“No, señor.”

“Is this a strange franchise of Banco Republica which has different rules?”

“No, señor.”

“Well then why does one rule apply here and another in Montevideo, where I don’t want to go, which will take another entire day of my life if I decide to torture myself through it?”

“Sorry, señor, those are the rules.”

“OK, then give me $10,000. And I’ll be back tomorrow, and the day after that, and the day after that, and the day after that, and the day after that… your rules, not mine. And I’ll have my money anyways, and all you did was make the whole process supremely annoying and inconvenient. Good thing I came here for a week and not just a couple of days.” Bumbling knuckledraggers. Other BROU customers, take note.

So, that brings me to something I realized on the way back to the old bunker… what exactly *does* $10,000.00 look like?

It looks a little something like this:

2013-03-13 17.01.01So, it’s a stack about a centimeter high. Not terribly impressive, considering all the work that went into it.

Something strikes me, and that is: as commonplace as this is to me, most people will never get to see this, let alone hold it in their hands. Many people might work through this severalfold during a year but will never accumulate it. All that work, distilled into this volatile, evaporating paper.

What will 10k buy you?

  • A really crappy new car.
  • A decent used car.
  • Two basic trail horses.
  • 78 cows.
  • A whole set of household furniture.
  • A whole set of household appliances.
  • Food for a couple of years.
  • 6 gold coins.
  • 333 silver coins.
  • A year’s worth of rent payments, maybe.

As you can see, it’s not a whole lot in the big picture.

Yet, this is the amount that most governments in the world will limit you to carrying across an invisible line in the dirt, and, in fact, will take from you if you do not tell them (and they find out about it), and/or throw you in jail for daring to scoff at their rule. This is the limit at which red flags are sent up if you wire as much or more from one place to another. A stack of paper no bigger than a notepad. A single year’s worth of rent can have you put in jail. The price of a pair of horses, or a used car.

Most countries participate in this financial shakedown. And in many, if you announced that you had this small amount with you, you would never make it out of the airport before you found that someone, or several someones, have forcibly traded your money for knives in all of your major organs.

And as if that is not enough, the “know your customer” rules have banks spying on any transaction larger than $3000, and it was even proposed that all transactions greater than $600 require both buyer and seller to file a form with the IRS.Has the world really truly become so petty?

According to this article, Paraguay’s Banco Central recently increased its reserves from 33.8 to 426.5 million dollars (nearly 400 million more) worth of gold to expand their precious metal reserves and diversify from the US dollar.

Rafael Lara, a director of the Banco Central, explains, “We aim to diversify our assets with currencies which provide no risk to the parent bank, and also because Dollar investments are kept close to 0% interest, a trend which will continue until the United States decides to withdraw stimulus to its economy, which markets predict will not happen until 2015.”

In the subway today I saw a guy reading the Spanish edition of Orwell’s 1984. I kept trying to wave and get his attention so as to ask him his thoughts on it, but he was so engrossed that he failed to notice me. Which is a good thing, I think.

Then I took some time to people-watch as I was waiting outside a station to meet someone. One guy dropped a 500-peso coin, worth about USD$1, and a stranger passing him picked it up, turned around, and chased the other man down to give it back to him. Then shortly after that a street vendor alerted a woman that she had dropped her subway card while putting something into her pocket.

All good stuff. On a cold day when folks are wrapped up and in a hurry to get back inside.

To balance out my good-deed-absorption of the day, I spent untold hours in line waiting to cash a check at Santander’s “Super-caja.” What a joke that place is. Literally more than 100 people waiting, my number was 120+ beyond the displayed ticket in line, and 2, count them, 2 cashiers to handle it all, with some 10 empty windows. Super-caja my pale white ass! Banking in Santiago is still pretty much third-world. It’s a shame, really, because you can receive excellent personalized banking service for everything else but to cash a damned check is a monumental task. I went out for a burger and came back 20 minutes later, and the queue had only advanced by 12 numbers or so. Screw that. If Super Caja isn’t super tomorrow morning, I’m going to reject the check and demand cash. Or break some kneecaps!