Matt, what you’re saying is legally correct, however, the way HSBC have conducted their KYC reviews following the AML flag on the account, has been fundamentally broken.
If they are incapable of carrying out the review in the first place, then the fact that they can’t disclose information is puts them at fault, and they need significant fines for failing to take it seriously. They cannot be allowed to cause this much damage to small businesses who have fully complied with their policy on multiple occasions.
They did not ask the questions which would have allowed them to complete the reviews correctly. When a shareholder’s equity deposit creates an AML flag, and a KYC officer cannot present a question that would enable the customer to explain it, then they need to review their questioning. Not once was I asked about our funding rounds or shareholders, or even asked to provide a shareholder register which would’ve been enough to resolve the issue.
Instead all they repeatedly asked about were customers and suppliers, and going round and round with the same set of questions. Even after suspending our account, they still didn’t have a path to resolution in any reasonable time frame, and it took media involvement before they took any action at all to remedy the frozen accounts.