Looks like the squeeze on our money has begun:

John Carney
Business Insider
Sunday, February 21, 2010

The image of banks locking their doors to keep customers from making withdrawals during a bank run is what immediately came to mind when we heard that Citigroup was telling customers it has the right to prevent any withdrawals from checking accounts for seven days.

“Effective April 1, 2010, we reserve the right to require (7) days advance notice before permitting a withdrawal from all checking accounts. While we do not currently exercise this right and have not exercised it in the past, we are required by law to notify you of this change,” Citigroup said on statements received by customers all over the country.

What’s going on? It seems that this is something of an error. The seven day notice policy only applies to customers in Texas, Ira Stoll reports at The Future of Capitalism. It was accidentally included on customer statements nationwide.

“Whatever the explanation, it doesn’t exactly inspire confidence in Citi,” Stoll writes. “But it’s hard to believe a bank would be sending out a notice like that on its statements.”

UPDATE: According to Stoll, Citi issued a statement saying that it has been required to make this change by Federal regulations--and it no longer sounds like it's limited to Texas:

Update: Citibank has now released the following statement by way of explanation: "When Citibank moved to unlimited FDIC coverage in 2009, we had to reclassify many checking accounts to allow for immediate withdrawals in order to ensure all customers qualified for the additional coverage. When we moved back to standard FDIC coverage with most major banks in 2010, Citibank decided to reclassify those accounts back to make them eligible again for promotional incentives. To do so, Federal Reserve Reg D requires these accounts, called NOW accounts, to reserve the right to require a 7-day notice of withdrawal. We recently communicated this technical requirement to our customers. However, we have never exercised this right and have no plans to do so in the future."


Yeah and they never planned to be bailed out either.



http://www.businessinsider.com/citigroup-warns-customers-it-may-refuse-to-allow-withdrawals-2010-2

Imo, the 'big' banks are imposing regulations on their customers rather than on themselves. How will that change anything? Is this really the 'free market' that will 'correct' itself sometime in the never-never land of the "free market" society--or is it a way for CEO's to continue their money grabs?

A "free market" is one thing, and a market where "fat cat" bureaucrats are paid off to look the other way when obviously illegal things are done is quite another. If we had ethics and honesty in government, this wouldn't be an issue and politicians wouldn't have anything to blame on the "fat cat bankers" that they themselves colluded in.

Red, I have an associate (close friend actually)who is an FBI agent in Las Vegas. A bulletin went out to agents warning them about the chaos that would be caused when Citibank shut it's doors on customers...this was in April 09. In April, agents were prepared for the worst.