Stunning news out of Switzerland this weekend where a Swiss pension fund manager, after calculating that he would save at least 25,000 CHF per year on every CHF 10m deposit due to negative interest rates, decided his clients' money was better off in an insured vault than a bank.
In fact the manager has a fiduciary duty to his clients, and if he can save money based on a technicality, he has to do it.
What happened next is both disturbing and shocking. The bank, which has acquired a reputation refusing to pay out money in such large amounts, told the customer he could not have his money. In a letter to the fund manager the bank stated:
“We are sorry, that within the time period specified, no solution corresponding to your expectations could be found.”
Swiss bank expert Hans Geiger says that this “is most definitely not legal”. The pension fund has a sight account, and has the contractual right to dispose of its money on demand. These types of demand accounts, where all money mus, contractually, be accessible in cash by the client are standard in Switzerland.
To not honor the request exposes deep trouble in both the banking system (which may be much weaker than it appears) and personal freedom (as banks now own your money, not you)
The policy of withdrawing one’s cash is evidently regarded as “interference with the SNB’s monetary policy goals” by both Swiss banks and regulators.
While troubling here at home, where our country has long prided itself on being the land of the free, Switzerland too regularly makes it to the top three on the list of countries with the highest degree of economic freedom.
It seems things both at home and around the world are changing for personal privacy and financial freedom. In short, the war on cash marches on.