Banking Horror Stories

[Delight]

My friends purchased a house -back in 2005(via a Company).

Recently they sold it

 

The procedes ended  up in their Thai bank account

 

Their request to transfer the money out of Thaiand was  refused.

 

The bank Manager cried 'Money Laundering'

He referenced the fact that they had no Bill  of Sale.

 

Clearly this would apply if a sold condo was in Company

 

Q.

Are  organisations such as Western Union  more co -operative?

 

Any other ideas  please.

 

 

 

[simoh1490]

This is fairly black and white:

 

If the property was sold and the transfer of ownership was made via the Land Office, the seller will have received a blue sales tax paid receipt which will allow the proceeds to be remitted overseas, anything other than that and it can't be, banks, western union, pigeon, it doesn't matter.

[ukrules]

Bitcoin

[scubascuba3]

The bank manager has a point, it does look ify. Currently in the Integration stage

[Delight]

9 hours ago, scubascuba3 said:

The bank manager has a point, it does look ify. Currently in the Integration stage

 

 

The purchaser  of the property  brought funds in from his homeland to his Thai bank

That Thai bank would not accept 'Iffy' money.

Given that -then the money is not 'Iffy'-the way that I see it.

Please explain  how it is 'Iffy' ?

 

Edited February 22, 2018 by Delight

[scubascuba3]

 
 
The purchaser  of the property  brought funds in from his homeland to his Thai bank
That Thai bank would not accept 'Iffy' money.
Given that -then the money is not 'Iffy'-the way that I see it.
Please explain  how it is 'Iffy' ?
 

You said it was purchased by "a company" and put in their personal name. This may be seen as the "layering stage" did they get a FET? I'm not sure if you can if the money wasn't transferred in by the same person

[Delight]

27 minutes ago, scubascuba3 said:

3 hours ago, Delight said:

 
 
The purchaser  of the property  brought funds in from his homeland to his Thai bank
That Thai bank would not accept 'Iffy' money.
Given that -then the money is not 'Iffy'-the way that I see it.
Please explain  how it is 'Iffy' ?
 

You said it was purchased by "a company" and put in their personal name. This may be seen as the "layering stage" did they get a FET? I'm not sure if you can if the money wasn't transferred in by the same person

The regular way that  foreigner buys a house is via Company. This  can also apply to a condo

 

The Company is transferred to a new owner. This is a transaction  that a lawyer sorts out. In essence the new owners name replaces the name of the current Managing Director. That's it. About a 10000Baht of a job

 

Of course the house is owned by the Company. The new MD now has the house.

 

The land office is not involved. FET 's are irrelevant

 

So  an exchange of MD's names and an exchange of money-simple

As I said before the new buyer brought funds,from overseas, into his  Thai bank account -then simply transferred to the seller's bank account

 

However no Bill of Sale-there lies the problem

 

Do you still think that this is 'Iffy'

If so please explain

 

 

[scubascuba3]

The regular way that  foreigner buys a house is via Company. This  can also apply to a condo
 
The Company is transferred to a new owner. This is a transaction  that a lawyer sorts out. In essence the new owners name replaces the name of the current Managing Director. That's it. About a 10000Baht of a job
 
Of course the house is owned by the Company. The new MD now has the house.
 
The land office is not involved. FET 's are irrelevant
 
So  an exchange of MD's names and an exchange of money-simple
As I said before the new buyer brought funds,from overseas, into his  Thai bank account -then simply transferred to the seller's bank account
 
However no Bill of Sale-there lies the problem
 
Do you still think that this is 'Iffy'
If so please explain
 
 

The bank manager seems to think its "Ify" so best you ask him about the suspected money laundering. Personally if i was buying a house in company name (which i wouldn't anyway) i wouldn't take on the company, only the house and form a new company. Old company can be closed once all taxes etc have been paid.
Anyway like i said, ask the bank Manager to explain

[simoh1490]

1 hour ago, Delight said:

The regular way that  foreigner buys a house is via Company. This  can also apply to a condo

 

The Company is transferred to a new owner. This is a transaction  that a lawyer sorts out. In essence the new owners name replaces the name of the current Managing Director. That's it. About a 10000Baht of a job

 

Of course the house is owned by the Company. The new MD now has the house.

 

The land office is not involved. FET 's are irrelevant

 

So  an exchange of MD's names and an exchange of money-simple

As I said before the new buyer brought funds,from overseas, into his  Thai bank account -then simply transferred to the seller's bank account

 

However no Bill of Sale-there lies the problem

 

Do you still think that this is 'Iffy'

If so please explain

 

 

It's "iffy" because it's illegal (1) for a foreigner to control a Thai company, (2) it's also illegal where the sole purpose of the company is to own a single property. Sure some people still own property this way but the Land Office has been cracking down on these company structures for many years, I can understand the bank managers point of view I'm afraid because it could be viewed as money laundering.

[Delight]

25 minutes ago, simoh1490 said:

It's "iffy" because it's illegal (1) for a foreigner to control a Thai company, (2) it's also illegal where the sole purpose of the company is to own a single property. Sure some people still own property this way but the Land Office has been cracking down on these company structures for many years, I can understand the bank managers point of view I'm afraid because it could be viewed as money laundering.

 The bank manager has no idea why the foreigner has new  funds in his bank account.  Not his business.

The point being that the funds entered Thailand via the Thai banking system (from the buyer) legally

If the original sorce was suspect then those funds would not be allowed in.

The bank manager is very happy for my friends to leave the money in the account and spend  the money in Thailand.

 

The only place I hear about 'Illegal 'this and 'Illegal 'that is on this forum -no where else

 

Condos are openingly advertised   as sold in Foreign ownership and Thai Company ownership

An obvious target for the government

 

Truth  is they  sit on their hand and do nothing

 

Why?

 

Money makes te world go around.

 So a foreiger controlling a Thai Company is clearly acceptable.

 

 

 

 

 

[KittenKong]

Is this really a banking horror story? I dont think so.

This a company-name property purchase horror story and as such it comes as no surprise to me.

[simoh1490]

4 hours ago, Delight said:

 The bank manager has no idea why the foreigner has new  funds in his bank account.  Not his business.

The point being that the funds entered Thailand via the Thai banking system (from the buyer) legally

If the original sorce was suspect then those funds would not be allowed in.

The bank manager is very happy for my friends to leave the money in the account and spend  the money in Thailand.

 

The only place I hear about 'Illegal 'this and 'Illegal 'that is on this forum -no where else

 

Condos are openingly advertised   as sold in Foreign ownership and Thai Company ownership

An obvious target for the government

 

Truth  is they  sit on their hand and do nothing

 

Why?

 

Money makes te world go around.

 So a foreiger controlling a Thai Company is clearly acceptable.

 

 

 

 

 

Whether something is acceptable or not depends on the point in time, just because something is acceptable or possible does not mean it's legal. Prostitution is also illegal yet it is tolerated and blind eyes are turned towards its existence, MOST of the time, but not always, it depends which way the wind is blowing, who is doing the looking and the phase of the moon. - sorry you didn't like the answer, don't shoot the messenger........why not confirm with a lawyer that it's correct and true, sounds like you'll probably need one anyway to help get the funds moved! Here's a thought: a Thai company requires five directors, three must be Thai in order to give them a majority, why not ask one of your fellow Thai directors to wire the money overseas for you, they can do it and that's legal......of course, you'd have to give them the money first in order to do that, do you know them well or even at all!!!

[scubascuba3]

Whether something is acceptable or not depends on the point in time, just because something is acceptable or possible does not mean it's legal. Prostitution is also illegal yet it is tolerated and blind eyes are turned towards its existence, MOST of the time, but not always, it depends which way the wind is blowing, who is doing the looking and the phase of the moon. - sorry you didn't like the answer, don't shoot the messenger........why not confirm with a lawyer that it's correct and true, sounds like you'll probably need one anyway to help get the funds moved! Here's a thought: a Thai company requires five directors, three must be Thai in order to give them a majority, why not ask one of your fellow Thai directors to wire the money overseas for you, they can do it and that's legal......of course, you'd have to give them the money first in order to do that, do you know them well or even at all!!!

Prostitution isn't illegal but people keep repeating this myth. Last time i read the law it was specifically running a brothel and street solicitation. This is why the bib have such a big thing about not having short time rooms on the premises

[simoh1490]

3 minutes ago, scubascuba3 said:

7 hours ago, simoh1490 said:

Whether something is acceptable or not depends on the point in time, just because something is acceptable or possible does not mean it's legal. Prostitution is also illegal yet it is tolerated and blind eyes are turned towards its existence, MOST of the time, but not always, it depends which way the wind is blowing, who is doing the looking and the phase of the moon. - sorry you didn't like the answer, don't shoot the messenger........why not confirm with a lawyer that it's correct and true, sounds like you'll probably need one anyway to help get the funds moved! Here's a thought: a Thai company requires five directors, three must be Thai in order to give them a majority, why not ask one of your fellow Thai directors to wire the money overseas for you, they can do it and that's legal......of course, you'd have to give them the money first in order to do that, do you know them well or even at all!!!

Prostitution isn't illegal but people keep repeating this myth. Last time i read the law it was specifically running a brothel and street solicitation. This is why the bib have such a big thing about not having short time rooms on the premises

Rubbish, prostitution has been illegal in Thailand since 1960.

 

https://en.wikipedia.org/wiki/Prostitution_in_Thailand

[scubascuba3]

Rubbish, prostitution has been illegal in Thailand since 1960.
 
https://en.wikipedia.org/wiki/Prostitution_in_Thailand

Key points i was referring to are below:

"Under the act, persons who solicit sex "...in an open and shameless manner..." (a phrase that is not clearly defined), or who are "...causing nuisance to the public..." are subject to a fine. Persons associating in a "prostitution establishment" with another person.

So police focus on those two. Anyway its off topic so will probably get deleted

[simoh1490]

1 minute ago, scubascuba3 said:

Key points i was referring to are below:

"Under the act, persons who solicit sex "...in an open and shameless manner..." (a phrase that is not clearly defined), or who are "...causing nuisance to the public..." are subject to a fine. Persons associating in a "prostitution establishment" with another person.

So police focus on those two. Anyway its off topic so will probably get deleted

Prostitution is illegal in Thailand, dress it up any which way you want and it still remains illegal.

[Delight]

 This post has got somewhat out of hand

 

Not helped by yours truly

 

Can I respectfully suggest that we return to the original  Q

 

Which as a summary is:-

 

The bank Manager cried 'Money Laundering'

He referenced the fact that they had no Bill  of Sale.

 

Clearly this would apply if a sold condo was in Company

 

Q.

Are  organisations such as Western Union  more co -operative?

 

Any other ideas  please.

 

 

[simoh1490]

The Bank of Thailand regulation are somewhat complex but they are very clear when it comes to foreign currency transfers and bank accounts and all companies capable of making funds transfers are governed by them, including Western Union.

 

Funds that have been earned here can be remitted overseas, funds that have been brought into the country from overseas can also be remitted, proof is required in both cases. Thai nationals can remit funds overseas given the purpose of the transfers meets closely defined criteria. The rules are here, click on the centre tab for the overview: https://www.bot.or.th/English/FinancialMarkets/ForeignExchangeRegulations/FXRegulation/Pages/default.aspx

 

You might want to try a larger branch of Bangkok Bank, they used to carry cashiers cheques drawn on their branches in London and New York which could be purchased in USD or GBP and then mailed/couriered to the home country for deposit to a local account. The exchange rate used is the TT rate so it's the best you can get plus the cheque is cheap to buy, maximum of USD 20k per cheque as I recall - it's a long shot and I wont be surprised to learn they've stopped issuing them since again, it's an aid to money laundering..

 

EDIT: what sort of scale are we talking about here, under 5 mill, 5 to 10 mill, over 10 mill?

 

 

Edited February 23, 2018 by simoh1490

[lkn]

21 hours ago, Delight said:

The bank manager has no idea why the foreigner has new funds in his bank account.  Not his business.

The point being that the funds entered Thailand via the Thai banking system (from the buyer) legally

In this case, where the foreigner wish to transfer the money out of Thailand, it is the bank manager’s business to learn the source of the money.

 

The bank manager only knows that someone deposited x million baht into the account, they do not know how the depositor obtained this money, or what exactly it is payment for.

 

If the money was legally earned, inherited, or profit from a sale, there should be documentation that can be shown to the bank manager.

 

If your friend has been with the same bank since 2005, ask to find the records for the money that was transferred from abroad to buy the house, and say that it is these money, that your friend now wish to repatriate. Although this would not allow them to send back any potential profit.

 

[Delight]

5 hours ago, lkn said:

In this case, where the foreigner wish to transfer the money out of Thailand, it is the bank manager’s business to learn the source of the money.

 

Thanks lkn for your input

 

 I have thought long and hard about the apparent anomalies in relation to the issue of Thai companies with Thai  nominee directors .

It boils down to ‘why are condo developers blatantly advertising Condos via Companies ?’ 

And why are developers building houses that only Farang can afford?

This is the way I see it.

 

It is impossible for a Farang to buy just  land via a Thai Company.

 

However the Thai authorities are very happy for both condos and houses to use the Thai Company work around

Both bring in substantial  money to Thailand and create many jobs. Both  in construction and general economic activity beyond the sale

The rub for the owners of both these dwellings is that the money can never be repatriated-as my friends have discovered.

It reminds me of a line in the song Hotel California-'You can check your money in any time –but it can never leave'.

I,ve modified it a bit

 

This arrangement  is perfect from the Thai perspective. They would be crazy to stop it.

In relation to my request for ideas

I have just spoken with my friends and they have found a solution

In the form of a Farang who wishes to exchange Sterling for Thai Baht

Sterling  will be transferred in the UK and Thai Baht will be transferred in Thailand.

Everybody is happy.

 Thanks to all those who contributed.

 

[simoh1490]

I hope the person in the UK who is buying the Thai Baht from your friend doesn't want to use it to buy property in his own name because he won't be able to since the THB he's going to use hasn't been issued via the Thai banking system hence there is no FTE or equivalent - that's his problem I suppose.

[lkn]

9 hours ago, Delight said:

It boils down to ‘why are condo developers blatantly advertising Condos via Companies ?’ 

 

And why are developers building houses that only Farang can afford?

I’d say that developers who advertize or even suggest a company package, are developers to be avoided, because if they’re willing to disregard this part of Thai law, they are probably willing to do many other questionable things as well.

 

I looked for condos a few years ago (Chiang Mai) and no-one presented me with a company package, even for projects where all foreign quota was sold out on the floor I wanted. The response was generally to ask if I had a Thai wife, because then I could buy in her name.

 

That said, I have certainly seen developers who advertise company packages, but those have been developers who I looked at only after reading bad things about them, so it only validated my belief…

[simoh1490]

And there's zero need to use a company to buy a condo since the 49% foreign quota exists.