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Wise during KYC asks me about money sent from my company account to...my mother.

K

karishi

well-known Member
Jan 11, 2020
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#1
I have a San Vincent and the Grenadines LLC, previously IBC, with Wise as the only bank, since 2019. Every year Wise does KYC and they always asked me about contracts and stuff for money coming into the company, which I never had problems providing. This year they are asking me about my documents and...Your company's service agreement with XXX where XXX is my mother. It's the only person besides me who received money from the company, I have been sending out money to my mother as I owed/owe her money for a long time, so there is no service agreement. Since an IBC or a LLC has no accounting, I simply sent money from the company account witouth transferring it to my personal account for ease.
What should I tell wise?My idea would be simply to tell them the truth, that I was using the company money as my money to pay old debts and to send money to my mother, faking a service agreement to me seems worse than what I did. What's your opinion?
 
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#2
I wonder what your mother’s bank will do when it sees a payment from a St. Vincent company :eek:

Seriously, it will take less time and effort to teach your mother how to use crypto than dealing with psycho monkeys in any bank’s compliance department.
 
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#3
JohnnyDoe said:
I wonder what your mother’s bank will do when it sees a payment from a St. Vincent company :eek:

Seriously, it will take less time and effort to teach your mother how to use crypto than dealing with psycho monkeys in any bank’s compliance department.
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My mother has been receiveing money for 4 years with no problems. For me it's not an issue to send money from the company Wise account to my Wise account and send money to my mother, it would be the same thing. and I can fake a property rental or a consultant contract for wise, but I don't like doing fake stuff just for the sake of it.
 
#4
shikari said:
My mother has been receiveing money for 4 years with no problems. For me it's not an issue to send money from the company Wise account to my Wise account and send money to my mother, it would be the same thing. and I can fake a property rental or a consultant contract for wise, but I don't like doing fake stuff just for the sake of it.
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Welcome to the present world, where you are not allowed to send money to your mother.
Legally speaking, it is not right to use a company as your personal piggy bank though, so Wise this time is not completely wrong. You should first pay yourself a dividend or a salary, then from your personal account send to your mother as a gift. In the process, you need to pay (and later show to the bank that you paid) taxes on dividends/salary, and your mother taxes on the gift.

Or just buy crypto and do what you like.
 
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#5
JohnnyDoe said:
Welcome to the present world, where you are not allowed to send money to your mother.
Legally speaking, it is not right to use a company as your personal piggy bank though, so Wise this time is not completely wrong. You should first pay yourself a dividend or a salary, then from your personal account send to your mother as a gift. In the process, you need to pay (and later show to the bank that you paid) taxes on dividends/salary, and your mother taxes on the gift.

Or just buy crypto and do what you like.
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I totally agree with what you say, I'm a UAE resident so I don't have many issue sending me a dividend, And I have 2k USD in wise which I can lose without issues and probably move out before the 14 days grace period ends. The point is, what should I tell Wise?Stupid mistake or make up a fake document?The proof of residence they have for me is for Albania....which is definitely not my country of birth. and all docs for the company points to the UAE.
 
#6
shikari said:
I totally agree with what you say, I'm a UAE resident so I don't have many issue sending me a dividend, And I have 2k USD in wise which I can lose without issues and probably move out before the 14 days grace period ends. The point is, what should I tell Wise?Stupid mistake or make up a fake document?The proof of residence they have for me is for Albania....which is definitely not my country of birth. and all docs for the company points to the UAE.
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Not being honest and feed banks with what they want to see is always the right thing to do.
 
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#8
Or maybe your mom has done some secretary works for you, who knows ;)
Like filtering out all spam emails you get and mark your important emails or stuff like that.
Who works for free anyways during these times.
 
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#11
dlttrading said:
Other idea would be:

You sent the amount what wise asked for as a Loan out to your mum. You show them a loan agreement with 5-10% interest.
Your mother pay it back in crypto some day later.
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Compliance department: “explain the rationale of the loan. How does the loan fit into the company’s business model? Show your mother’s credit worthiness.”
Client: “gasp”.
Compliance: “we regret to inform you that the account has been closed. The decision is final. We will not provide any information on our decision. Please provide a personal bank account where to send the balance once our due diligence has been completed”.
 
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#13
JohnnyDoe said:
Compliance department: “explain the rationale of the loan. How does the loan fit into the company’s business model? Show your mother’s credit worthiness.”
Client: “gasp”.
Compliance: “we regret to inform you that the account has been closed. The decision is final. We will not provide any information on our decision. Please provide a personal bank account where to send the balance once our due diligence has been completed”.
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Facts...lol!!!!!

I would tell them the basic truth then take the L and move on from them. You got to see Wise's point of view. It all looks very dodgy and does not pass the sniff test.
 
#15
Martin Everson said:
Facts...lol!!!!!

I would tell them the basic truth then take the L and move on from them. You got to see Wise's point of view. It all looks very dodgy and does not pass the sniff test.
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Well I can simply make a service agreement where my mother provides consultations about business development or business mentorship. I mean, they don't know it's my mother, it's simply money going out of the account every 3 months. Printed and signed on paper so I can back date it. Which is believable. So far I have had zero issues in 4 years with wise, I guess the only thing they could ask for in KYC was this one as I provided contracts for every single penny that entered the account. I will try that approach, if it doesn't work for some reason I will open a UAE company and close this one.
 
#16
shikari said:
Well I can simply make a service agreement where my mother provides consultations about business development or business mentorship. I mean, they don't know it's my mother, it's simply money going out of the account every 3 months. Printed and signed on paper so I can back date it. Which is believable. So far I have had zero issues in 4 years with wise, I guess the only thing they could ask for in KYC was this one as I provided contracts for every single penny that entered the account. I will try that approach, if it doesn't work for some reason I will open a UAE company and close this one.
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You have been doing this for 4 years? You should better stop if you care about your mother. If she lives in some money hungry country she could soon receive an early morning visit of the tax police.
 
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#17
JohnnyDoe said:
You have been doing this for 4 years? You should better stop if you care about your mother. If she lives in some money hungry country she could soon receive an early morning visit of the tax police.
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yes I will stop now, it has been a stupid idea all along, sometimes you do things and you don't think about the consequences. In any case we are talking about pocket money 10/15k a year. She is 73, retired, makes 50k a year from welfare, the old italian welfare, the tax authority came knocking when she bought a house, but she had done the first fiscal shield where you could bring to italy any amount of money you had abroad and pay 4% to clean it...
 
#18
shikari said:
yes I will stop now, it has been a stupid idea all along, sometimes you do things and you don't think about the consequences. In any case we are talking about pocket money 10/15k a year. She is 73, retired, makes 50k a year from welfare, the old italian welfare, the tax authority came knocking when she bought a house, but she had done the first fiscal shield where you could bring to italy any amount of money you had abroad and pay 4% to clean it...
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Holy crap, the Guardia di Finanza is watching you! And is likely reading this too.
 
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#20
JohnnyDoe said:
Legally speaking, it is not right to use a company as your personal piggy bank though,
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Can you elaborate on what you mean?

JohnnyDoe said:
You have been doing this for 4 years? You should better stop if you care about your mother. If she lives in some money hungry country she could soon receive an early morning visit of the tax police.
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What's precisely wrong with that? As long as the @shikari has paid his -- for his company -- taxes, what problem could there be about the fact that he's been sending money, or income of his company, to his mom?
 
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