Tony Hetherington is Financial Mail on Sunday’s ace investigator, fighting readers corners, revealing the truth that lies behind closed doors and winning victories for those who have been left out-of-pocket. Find out how to contact him below.
S.M. writes: I tried to buy Bitcoin using my online account with First Direct, which is part of HSBC.
Not only was the transaction declined, but the bank froze all my online payments and insisted I had to phone them instead.
I was then told I could make online payments again, but only to previously existing accounts. So, is it illegal to buy Bitcoin?
Concern: Bank staff did not want to facilitate the purchase of medicinal cannabis
No, it is not illegal to buy Bitcoin. You were told more than once by First Direct that it would not make the payment you requested and that this was for your own protection. But as you have told me and the bank, you have more than £3 million in assets and were only switching £1,000 into Bitcoin, so you hardly needed protecting.
What then was the reason for First Direct’s refusal to let you spend your own money as you wish? When I discussed this with you and the bank, the answer gradually became clear.
The account to which you were sending your £1,000 was flagged as suspicious on the bank’s systems, which is why the transfer was blocked and you were questioned. You explained that you are in your 60s and your wife is in her 70s and ill.
Here is the problem. You were honest enough to explain that you were going to buy medicinal cannabis online from a dealer who would only accept Bitcoin as payment, presumably because it would be hard for the authorities to trace.
You let matters lie for a week and then tried again, giving a different reason for the deal. But the bank again turned you down, repeating that this was for your own protection.
Frankly, I think it was more for the bank’s protection. Without intending it, you had put the bank in the position of being a potential money launderer, handling funds for your drug deal.
I am not making any judgment on the uses or misuses of cannabis, but I can understand completely that if your cannabis was intercepted in the post, and you told the police that HSBC knew all about the deal, then that would cause the bank more than a little embarrassment.
Officials were reluctant to talk about this. Eventually they told me: ‘We take the financial security of our customers extremely seriously and have advanced safeguards in place to deter and detect financial crime.’
A bank spokesman added: ‘We fully appreciate Mr M’s position, but we also cannot knowingly facilitate any activity which is potentially illegal.’ Your honesty means the bank will be watching for unusual transactions, but I am sure that after a while you will find that normal services are resumed. Probably after bank staff have stopped grinning at the fact that you and your wife have a joint account.
You can escape tax on your pension lump sum
G.H. writes: I have deferred my state pension as I am still working but will retire shortly. In the tax year 2019-20, my income will be below the tax threshold, so I will pay no tax.
When I claim my state pension, even with my other income, I will still be below the tax threshold. I was told I would only pay tax on my state pension lump sum if my total income is above the threshold in the year claimed.
So, I was alarmed last Sunday to read in your column about a gentleman who had to pay tax on his lump sum.
Worried: G.H. was alarmed to read last week in Tony’s column about a gentleman who had to pay tax on his lump sum
The lump sum is taxable when you stop deferring your state pension and begin to claim it, but this only applies as long as your other income makes you a taxpayer.
You can even claim the state pension but postpone the lump sum until the following tax year. This means that if your income drops and you become a non-taxpayer, the lump sum escapes tax.
What went wrong for the reader whose letter we published last week was that he received his lump sum in a year when he had still been earning.
He was therefore a taxpayer, so the lump sum was quite correctly taxable.
WE’RE WATCHING YOU: Loan note duo shut down in land scandal
I wrote last week about the risks involved in investing in unregulated loan notes – or IOUs – issued by Certain Bridge Limited, headed by Gary Hall, and promoted by a separate company, ASP Consulting, which is run by Abdool Saleem Peerbux.
Now I can reveal that by an almost X-Files coincidence, companies that had been headed by Gary Hall and Abdool Saleem Peerbux ended up in the High Court on the same day, before the same judge, and with the same result – they were shut down.
That was in January 2010, when the Insolvency Service won court orders to wind up nine companies it had investigated, all of them ‘part of a land-banking scheme’, officials said.
At the time, land-banking investment schemes were a scandal. Companies bought fields without planning permission and then sold house-size plots at vastly inflated prices, often with false claims that planning consent was just around the corner.
Hall had been a director of four of the nine companies. Peerbux was a director of one. Hall’s lawyers say his four companies never dealt with the public, but provided land for others to sell on. In a remarkably worded statement, they told me: ‘These sales were not WEAPONS or DANGEROUS materials or PROTECTED wild animals, it was Cheshire and Lancashire LAND. What these purchasing companies did with their purchases was their business.’
So why did the court close down all four companies? Equally remarkably, Hall says the Insolvency Service lied: ‘The statements made under oath were riddled with perjured statements which included downright lies, untruths, falsehoods and manipulated events bearing no resemblance to true facts.’ Nonetheless, the four companies committed a string of offences while Hall was a director. Every one failed to file accounts at Companies House or to give details of its owners. Although legally responsible for the running of the companies, Hall says he relied on someone else.
Similarly, Peerbux now says that although he was a director of Impact Marketing.com Limited, and described himself in official documents as a ‘property broker and land portfolio manager’, he also left responsibility for the company to someone else.
Peerbux was also behind a company called Prime Acquisitions Resources. I warned in 2010 that it was marketing a dubious scheme that offered an estimated 15 per cent yield and 50 per cent capital gains, all through growing rice in Sierra Leone.
Although Peerbux sold the scheme, it was run by a Cheshire property developer, Robert McKendrick. Four weeks ago I reported that McKendrick has now been jailed for six months for contempt of court after trying to sidestep an order to repay investors more than £15 million.
Lawyers for Peerbux told me Prime Acquisitions Resources was dissolved because overheads and expenses became too high against revenue. In fact, it failed to ever file any accounts and was compulsorily struck off in 2013.
When I raised questions about claims made by his current company ASP Consulting, Peerbux took down its website. His lawyers refused to discuss this because, they said, Peerbux is seeking approval as a representative of a firm licensed by the Financial Conduct Authority.
The regulator refuses to comment, but has said that any firm that appoints a representative takes full responsibility for seeing that they stick to the rules and must be able to prove that they carry out close monitoring.
If you believe you are the victim of financial wrongdoing, write to Tony Hetherington at Financial Mail, 2 Derry Street, London W8 5TS or email email@example.com. Because of the high volume of enquiries, personal replies cannot be given. Please send only copies of original documents, which we regret cannot be returned.