In order for somebody resident in Russia to open an account on the Isle of Man, they need to have an opening balance of 60,000 Pounds Sterling, which despite my status as cigar-puffing oilman, I do not have. The reason why they demand such a high opening balance for Russian residents (the normal requirement is 5,000 Pounds Sterling) is because of the risk of “money laundering”. And that is about as detailed an explanation as I could get.
What is interesting is that HSBC do not advertise this requirement anywhere, it is simply a decision which gets made at the application stage. Personally, I think the explanation is bollocks. Anyone wanting to launder money from Russia is probably not going to be doing so in small amounts, and I can’t see how a 60,000 GBP opening balance is going to do anything to discourage such activities. If anything, putting a maximum balance on the account would be more of a control on money laundering rather than a minimum balance.
They\’re not putting that minimum on so as to insist that only rich bastards who are going to money launder open and account.
They\’re doing it because the costs of doing the checking of who you are, of monitoring what you\’re laundering or not laundering (yes, even to the laughably inadequate levels that HSBC have been doing so), as so high that only someone who is putting £60k or more into an account makes any money for the bank.
What you\’re seeing here is the costs of the money laundering regulations.