New Economic Realities

[mendeleyev]

Two days ago my wife was startled to learn that her personal bank account was empty. Overnight it had been cleaned out. Naturally I was alarmed at the prospect of joint accounts, and my personal international accounts, but those were untouched.

The bank said that tax authorities, and pension authorities, had levied the withdrawals. Odd, if there is one thing we do in a timely fashion, it is to keep those paid and current.

I offered to go with her yesterday to visit that government office, but feeling that having an American husband in the same room might not be the best idea, she ventured there herself. She arrived at 8am to stand in line until the office opened. Once inside she took a number like everyone else and waited to be called. The only mistake was that she didn't take multiple copies of proof of payments which we had at the ready.

Finally, her number was called. "Oh, you are at the wrong window. Go get another number and wait for window 12" she was told. So, she did as instructed. Over an hour later, her number was called. "Oh, you are at the wrong window. Go get another number and wait for window 22," were the next words she heard.

That went on and on all day. She approached a manager and was told to "pick a window, take a new number, and wait your turn."

In the afternoon she barged into another manager's office and demanded to see someone who could address the issue. The manager handed her a book and said find the address in this directory. You will have to write a letter to the correct authority. There were hundreds of listings for tax and pension officials, so she asked for guidance on which authority to contact. "Choose one for yourself" was the answer.

She returned to the main window, took a new number, and again waited.

Finally, a woman agreed to look at her paperwork, then summarized that the bank had made a mistake. "No, the bank made no mistake. This is clearly your office levy as provided by the bank, signed by a manager of this office" my wife retorted. The woman then asked for her payment receipts. She asked to keep them for her file, but alas, my stubborn darling had not made copies. The woman claimed that there was no copy machine in the tax office to which my wife, more angry than before offered "tomorrow I will bring you a copier from my home since our poor country cannot afford to buy one for the tax office."

She left to make copies at a firm around the corner, wondering if kickbacks are involved since the firm was suggested by the woman in the window. There, to her surprise, she found a few others making copies of their tax and pension receipts. In conversation as they waited for the copies, it became clear that she was not the only citizen whose bank account had been levied. Like her, they too were owners of small businesses and had proof of their payments.

I found it particularly odd that it was a personal account, not the business account from which she routinely pays these obligations, was levied.

She made it home after 9pm, tried, crying, and frustrated. At that point, a woman who tries to remain loyal to her nation and loves the motherland, was deeply ashamed at her country.

[mendeleyev]

Are Russians starting to feel the frustration at the current economic crisis to a greater degree?

The fact that Moscow police, and police in other large cities, now carry spray paint to cover up anti-government political graffiti just might be a sign of mounting tensions on the street.

Add to that the number of small protests, also may be a clue.

[mendeleyev]

Russia's Reserve Fund, designed to bolster Russia during economic crisis, has dropped to levels that Russian officials say could exhaust the fund in as soon as 18 months as the government needs monthly infusions just to keep up with social entitlements such as medical, pension, and other liabilities.

The economic downturn in China isn't helping either, as some Russian bankers fear that Beijing will force Moscow to renegotiate contracts, again.

[LAman]

As the Manhattan Project group discovered back in the 40's......the biggest explosion is an implosion!!!!!

[ML]

Wow Jim . . . sorry to hear this has happened to you and your wife !!  :-((

[alex330]

Horrible situation.

Unfortunately I feel we will see more and more of it in a number of countries these days.

[Gator]

At that point, a woman who tries to remain loyal to her nation and loves the motherland, was deeply ashamed at her country.

Love the motherland, and the motherland levies you in return.

You and your wife have my sympathy.  Maybe this explains why my wife becomes nervous about whether we are paying American taxes correctly.

So what happened?

[tfcrew]

 


             I would urge...don't give up with any financial difficulty anywhere.
   See their kommisar and then ask to see theirs if they don't turn up with answers.
    Youtube link didn't work above. Found this pdf...
                      http://www.pwc.ru/en/publications/assets/e-crisis-survey_eng.pdf

[southernX]

mendy , sorry to read this news from you above

can i ask the value of the ''levies that they took from your accounts ??

are we talking small amounts under $500 or larger ??

SX

[calmissile]

Sorry to hear your experience with the bureaucrats in Moscow.   Reminds me of every time I go to the California Department of Motor Vehicles (DMV).

Is Russia getting so desperate for money that they need to steal from the masses, or is it a target against journalists?

[mendeleyev]

Yesterday Mrs M went for an appointment at the government office responsible for taking (valued at several $k) from her account. The first official flatly declared that they had not taken any money and the whole mess must have been a mistake by the bank. She noted that there were other citizens in the lobby area there to discuss the same situation--therefore the bank must be screwing up big time. In reality however, the bank has provided her with copies of the signed levy orders from this particular government office.

Upon arrival of a higher manager to her meeting, the second person not only admitted that they had levied her account, but tried to claim that it was because she was behind in her sales tax and pension contributions. She laughed and produced receipts proving that those obligations were paid, consistently, and on time. As with so many situations, receipts seem only valid if the government is issuing one, but not so often when later presented with those same receipts.

She has a business account from which those are automatically taken, based on her art sales and her required monthly "social" payment obligations. However, they had not taken the extra money from the business account, but from a personal account. To which the first person commented that since the money was taken from a different account, it was not the government's problem.

She left, still very frustrated. I have advised her that for the next meeting she should offer to bring along her journalist husband, an American, as he might be interested on doing a report on how tax screw-ups are apparently becoming more common in Russia. She isn't sure that such a move wouldn't create more problems...

[southernX]

not a good turn of events mendy

it seems you are not orphans in the money grab though

 they are just following a long soviet tradition inflicted on their people many times over

SX

[msmobyone]

Hi Mendy

Just read this

Frightening - it's bad enough for it to happen - but the attitude - to 'solving' the problem is simply shocking.

Please keep us updated

[JayH]

It gets worse ! I notice the ruling that banks are not obliged to give you your own money !!
More handiwork of Kremlin genuis.

Also of interest-- only 16 banks are due to survive.
In Ukraine many little people lost their life's saving in the hiatus of the banks 2 years ago.

[mendeleyev]

An attorney is now engaged to assist with this matter as they keep threatening to dip into other accounts.

[Faux Pas]

An attorney is now engaged to assist with this matter as they keep threatening to dip into other accounts.

Mendy is it out of the question for the wife to take a bank representative to the next meeting?

[Chicagoguy]

Mendy ... I might have asked you last year but do you think Citibank is more trustworthy ?  I notice they have locations and ATMs in some other cities besides Moscow.

Last year in Cheboksary my wife could not get her generic US ATM card to work at any ATM so we had to go back to Western Union. No trouble previously with local ATM.
But her pension money is all in rubles in local bank.

[ML]

In Ukraine many little people lost their life's saving in the hiatus of the banks 2 years ago.

Back at end of 90s or so, people did lose the money they had in Ukrainian banks.

But, it did not happen with the last banking crisis.
True, they could not get their money out initially, and then could only take out small amounts for a time period.
However, no money was lost because National bank forced mergers of weak banks and backed up deposits like our FDIC.

[Bee Farmer]

Sounds like you need to put your money in an international trust, as in yesterday.  You still have access to the money, but your government can't touch it.

http://www.internationalman.com/articles/doug-casey-there-is-a-rogue-elephant-in-your-house

[alex330]

Yes, can't you move your money offshore? asap

[mendeleyev]

Mendy is it out of the question for the wife to take a bank representative to the next meeting?

The bank just wants to wash their hands of the matter, and in a way I cannot blame them--they are acting on government dictates and really have no choice in the matter.

Today she is back at the government offices after we engaged the services of an attorney. Hopefully they will make some progress.

[Faux Pas]

The bank just wants to wash their hands of the matter, and in a way I cannot blame them--they are acting on government dictates and really have no choice in the matter.

Today she is back at the government offices after we engaged the services of an attorney. Hopefully they will make some progress.

Certainly understandable however, they are complicit in the whole affair. It was the bank that deducted the money. I do understand the metrics here in that they will do what the government tells them with the Misses and you be damned. But, they could have notified you before the fact and assisted you in representation after. You did keep money in their bank for safe keeping.

Trust me "I know" you're basically screwed from every direction with no recourse. It is after all Russia but, if the bank is a reputable one, shouldn't they at least pretend to care?

[Slumba]

Just a note, that the State of California did this in the past also... they issued bogus notices and pulled the money from people's accounts. Even in cases where the LLC was defunct or people had moved out of state years ago.

e.g. http://lasvegassun.com/news/2008/nov/08/californias-long-arm-reaches-bank-account/

Part of the reason I closed my safety deposit box long ago - its existence gets reported to the government and they can open it without you knowing and without a court order.  Thus not safe from tampering.

[Anotherkiwi]

Part of the reason I closed my safety deposit box long ago - its existence gets reported to the government and they can open it without you knowing and without a court order.  Thus not safe from tampering.

Wow!  Makes me so glad I don't live in California the USA!

Thanks, Slumba!

[Slumba]

Wow!  Makes me so glad I don't live in California!

It is country-wide actually, all across the USA.