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Diplomats complain about no US bank accounts - Daily News Egypt

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Diplomats complain about no US bank accounts

UNITED NATIONS: Diplomats from many countries complained to US government officials Thursday about the decision by several American banks to close the accounts of their diplomatic missions and their difficulty in finding new banking facilities. Patrick Kennedy, the State Department’s undersecretary for management, and Mark Poncy, director of strategy policy at the Treasury, briefed about …


UNITED NATIONS: Diplomats from many countries complained to US government officials Thursday about the decision by several American banks to close the accounts of their diplomatic missions and their difficulty in finding new banking facilities.

Patrick Kennedy, the State Department’s undersecretary for management, and Mark Poncy, director of strategy policy at the Treasury, briefed about 200 diplomats behind closed doors and then listened to envoys from many of the UN’s 192 member nations.

"We heard their concerns," Kennedy told reporters afterward. "We’ve offered some suggestions on what … alternative approaches they might take to obtain additional banking services."

Kennedy said the US would continue to work with the diplomats and with the banking industry.

"There are not only one, two or three banks in the United States, and we offered a number of suggestions on how approaches could be made to banks based upon factors that we feel would be appealing to the banks to add this nation or that nation as a customer," he said.

Kennedy refused to disclose any details of the suggestions, stressing that US banks are private, and while government-regulated "they are not government directed."

He said the US is committed to working with diplomatic missions not only at the UN but in Washington — where many embassies face the same account closures, adding that Treasury Secretary Timothy Geithner and Secretary of State Hillary Rodham Clinton are working to resolve the problem.

JPMorgan Chase & Co., which held many UN diplomatic accounts and is among the banks closing them, gave no reason for its action.

In a Sept. 30 letter, it assured ambassadors that "this business decision does not reflect on your organization or how you have handled your account(s)." It added that personal accounts would not be affected.

But Egypt’s UN Ambassador Maged Abdelaziz pointed to more rigorous US federal reporting rules.

"Banks are acting on a commercial basis … so they have to calculate every penny they spend," he said. "If you keep asking them to present reports about monitoring and others, then this is one factor they have to take into consideration — and it is a private enterprise."

The United States tightened reporting regulations for overseas transactions after the Sept. 11, 2001, terrorist attacks. The rules aim to prevent the illegal flow of foreign funds for such crimes as money laundering, terrorism and drug trafficking.

American financial institutions already have been required to report to federal authorities all cash transactions over $10,000 — both foreign and domestic — as well as other transactions that look suspicious. But under a Treasury Department proposal, those regulations would be tightened even further, requiring banks to report every week on all electronic money transfers into and out of the United States, no matter how small.

Ambassadors from South Africa, Morocco, Egypt and Iran, and the Palestinian UN observer told reporters they complained at the meeting that they have not been able to find alternative banks.

"We can’t find yet another bank. We shopped around," Egypt’s Abdelaziz said, adding that banks told his mission "they don’t have space."

South Africa’s UN Ambassador Baso Sangqu said "we are looking for solutions," stressing that diplomatic missions can’t operate without banking services.

Iran’s UN Ambassador Mohammad Khazaee said the problem not only threatens the operation of UN missions but the functioning and existence of the United Nations because countries can’t pay their UN dues and contributions to the world body’s peacekeeping missions without a US bank account.

"All missions have been looking … to find a suitable bank to open their account but unfortunately from what I hear from almost everybody, no bank has been cooperating with them," he told reporters.

Khazaee said he suggested that the United Nations Federal Credit Union be authorized to provide banking services to diplomatic missions. He said he also suggested that the United Nations take its money out of Chase "and put it in the bank that is willing to open accounts for missions."

 

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https://www.dailynewsegypt.com/2011/01/14/diplomats-complain-about-no-us-bank-accounts/
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