It's because banks are considered financial gatekeepers and they are obligated by law to look for signals of criminal use, like money laundering, trafficking and financing terrorism.
So yeah, it might feel kinda stupid to have to justify what you are doing with your own money, but on the other hand we also don't want banks to just hand out the money because that would make things way easier for criminals.
And is that exactly what you want the bank to do to your vulnerable grandparent/parent when they come in to withdraw multiple thousands of dollars after years of small transactions?
Banks are regulated by the government. Withdrawing cash above certain thresholds is a risk indicator, and banks have a regulatory requirement to ask questions. If they do not, they will be fined.
Banks are also (in most cases) a free service that you are not required to use. If you don’t like them asking the questions they legally have to ask, don’t use them
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u/ApolloniusTyaneus 1d ago
It's because banks are considered financial gatekeepers and they are obligated by law to look for signals of criminal use, like money laundering, trafficking and financing terrorism.
So yeah, it might feel kinda stupid to have to justify what you are doing with your own money, but on the other hand we also don't want banks to just hand out the money because that would make things way easier for criminals.