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Bank Doesn’t Want Loan Paid Off With Cash

May 28, 2012 by  

Bank Doesn’t Want Loan Paid Off With Cash
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Alex Kenjeev used cash to pay off his student loan.

Alex Kenjeev, a 2009 graduate of the University of Toronto, finished paying off his student loan — with cash.

The law student carried $114,460 in a sack to Scotiabank.

Both banks involved in the transactoin gave Kenjeev a hard time. The Royal Bank of Canada, where Kenjeev withdrew the cash, initially refused him. He finally got his money, but it took three days. Then, when the former student went to Scotiabank, the lending bank, the manager did not want to accept the payment.

“I just plopped the bag down,” recalled Kenjeev.

“I was pretty naïve. I didn’t really realize how much of a hassle I’d cause for everybody. You just look at things and you figure cash is simpler than anything else,” said Kenjeev.

Kenjeev is happy to be out from under the debt, but he confesses he enjoyed the process more than the banks did.

“It was stressful enough to carry such a big debt load. I thought it would be worth getting a few laughs out of it. Neither bank thought it was as funny as I thought it was.”

Bryan Nash

Staff writer Bryan Nash has devoted much of his life to searching for the truth behind the lies that the masses never question. He is currently pursuing a Master's of Divinity and is the author of The Messiah's Misfits, Things Unseen and The Backpack Guide to Surviving the University. He has also been a regular contributor to the magazine Biblical Insights.

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  • http://gillysrooms.blogspot.com GILLYSROOMS IN AUSTRALIA

    A few years ago a purchaser attempted to use cash to settle the purchase of a substantially priced Melbourne city building in Australia and the purchasers representatives refused to accept legal tender cash….may have been a $1,000,000 pounds. The matter went to court and the purchaser got the building for nothing…or so the story goes. One of you lawyers may be able the find the relevent CASE LAW and advise us of the actual details.

    So the Scotiabank may have been running the same risk if their law was similar to our English based laws for refusing to settle his mortgage by him tendering legal tender cash.

    Now I dont for one moment, maybe two believe that the bank staff were actually refusing the legal tender cash aspect to discharge the loan, but rather that they were conscerned the source of the money perhaps thinking it could have been illegal drug money or untaxed funds or fake bills and did not wish to be inbroglioed /involved in any scam or illegal activities as indeed bank staff these days are rarely coming across real $dollar bills in such quantities as everything is on credit cards and promissory notes on the never never. Lets face it we rarely see huge cash amounts even in banks these days but more likely in the media news when police take possession of drug money used by untaxed dealers etc.

    As the Motley Fool firm are suggesting, the use of cash as we know it is likely to disappear soon by which time many may not even know the colour of cash notes let alone how to tell fake money from the real stuff.

    But the above story does show how suspicious banks and staff have become with anyone that uses cash, REAL legal tender CASH to pay for anything including houses and I bet some staff have never seen or handled real cash in those quantities to know what to really do with it, most people who have it either cant bank it or wont bank for fear of losing it to the banksters..lol

  • David in MA

    This guy should have seen a lawyer and if told it is legal and if refused the debt paid, and then take the lawyer to the bank with him, attempt the payment and if refused, just might have left the bank with no debt and a sack full of cash…..would be justice to screw a bank like that.

  • http://www.ifonlyphotos.com Alex Frazier

    Well, the bank he took it from didn’t have the money, which is why they didn’t want to give it to him. My bank here locally has refused to give me funds before, because they just didn’t have enough cash on hand. None of the banks except the main branch keeps any significant amount of cash.

    The bank he took it to didn’t want to count it. And Gilly might be right, too. With such a large quantity, they may not have wanted to be responsible. Although, banks are full of moral hazard. If they were cheated, they could simply reverse the “payment” he made on the loan, charge him interest and penalties, then call the police and charge him with fraud, counterfeiting, or any number of other charges.

    It all really has to do with the banking institutions not wanting to deal in cash anymore. They are trying to push people into using debit cards. Printing money becomes a much easier task when the paper and ink both exist in cyberspace. It’s instant, doesn’t cost them a dime, but has the exact same effect as pumping trillions in new bills into the system. Currently, it costs approximately 7¢ per bill to print, which amounts to $112,000,000,000 in printing costs to produce $1.6 trillion (the amount we are borrowing anually to satisfy the deficit), assuming every dollar of that $1.6 trillion is being printed.

    It’s kind of funny actually. It’s costs us as much as $100 billion a year to print the $1.6 trillion a year we spend that we don’t actually have.

    • http://www.ifonlyphotos.com Alex Frazier

      It IS worth saying, however, that the denominations printed will have an impact on the cost of bill production. I neglected to mention that. So the cost would be reduced by printing all hundreds.

      • Chester

        Has any of you gone to an American bank and tried to withdraw so little as ten thousand in cash within the last thirty or so years? First the bank has to verify where you got that money from in the first place, then you have to sign a sworn statement that it is to be used for no illegal purpose. When you go to make a bank payment with that much cash, or even deposit it to your account, again, there are about ten pounds of paperwork to be gone through and signed, plus an immediate statement sent to the IRS concerning that cash deposit. Here this boy was drawing out well over ten times that cutoff, so, even in Canada, the whys and wherefores all had to be disclosed.

  • eddie47d

    He could have simply transferred the money from one bank to another and been done with it. What a waste of everyone’s time. This wasn’t some kid with a piggy bank full of nickles.

    • bsg

      A great example of Gresham’s Law–Cheap money will always drive out expensive (dear) money. Much easier to juggle a few numbers on a spreadsheet than have to count out bills.

  • WOLF

    The amounts discussed do kick off drug alarms. That said,I’d rather walk out the door with a card with a $50,000 limit than that amount in cash.

  • JimH

    $114,469 Canadian. That would be worth about what? $110 U.S.?

    • http://eagle-research.com George Wiseman

      JimH, that was un-called for. As an American currently enjoying Canadian hospitality I can assure you that for the last year or so Canadian money has been worth MORE than US.

      If you think US dollars are worth a lot, I commend your support for US currency, and advise you to start paying attention to what’s happening to the dollar… and the economy.

      Canada’s economy is stronger, but suffers from a similar debt problem that will take it down too.

      • JimH

        If you can’t take a joke, stay up in Canada.

  • Dave

    A few years ago I was buying a plane. Went to the bank and wanted to take out a bank draft and they wanted the address and name of the person I was getting the draft for. I didn’t know his adress and because it was Friday afternoon it was impossible to get the information and pick up the plane the next day. I ask for cash instead and they were really ticked off about that but in the end gave it to me.

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