Saturday, June 12, 2010

Doorstep bank raids plague cash-loving Argentina

 Interesting article from Reuters. Makes it easier to understand why a gun and body armor isn't a bad idea if you have to get large sums of cash out of the bank in Argentina.


Doorstep bank raids plague cash-loving Argentina
Helen Popper
Thu Jun 3, 2010 11:35am EDT

BUENOS AIRES (Reuters) - In a country where cash is king, a trip to the bank can be fraught with danger.

Tax evasion and low rates of banking use mean many Argentines prefer cash to checks or direct debits, making the country fertile ground for gangs of thieves who strike after customers leave the bank carrying wads of cash.

A surge in such crimes is fueling demands for a crackdown. Lawmakers say banks should be forced to shield counters from view and get insurance against the so-called "leaving the bank" raids.

Buenos Aires Mayor Mauricio Macri wants to ban passengers riding on the back of motorbikes to fight drive-by robberies in the capital's financial district.

Thieves are often armed and shootings are common, but many people still run the risk of withdrawing large quantities of cash. Small businesses and charities, many of which pay suppliers with wads of bank notes, are particularly vulnerable.

Lucia Gimenez, treasurer for a shelter for domestic violence victims, insists on paying suppliers inside the bank since robbers smashed her car window and grabbed 14,000 pesos ($3,500) withdrawn to pay the center's food bills in April.

"I was so angry, I couldn't even cry," said Gimenez, who was not hurt in the robbery in the northern city of Resistencia. "You put so much time and effort into these kinds of institutions and this seemed so unfair, I felt abandoned."

Similar crimes are common in other parts of Latin America, but an increase in the robberies is making headlines in the region's third-biggest economy.

"More than being aware of the problem, people are scared, they're very frightened but there aren't a lot of alternatives if you have to go to the bank," said Gerardo Milman, a lawmaker who is pressing for tighter bank security.

"It has a lot to do with the lack of banking penetration in Argentina," he added, saying bank use was far lower than in neighboring Brazil and other countries in the region.

Argentines remain wary of sharp devaluations and freezes on bank withdrawals less than a decade after the country's worst economic crisis, and many prefer to stash their savings in cash under the mattress or in safe-deposit boxes.

When buying a house, the deal is often sealed when stacks of dollars change hands in the bank or a notary's office, and many people pay everything from gas bills to new cars and employees' wages with stacks of notes.

Surgeons at the best private hospitals demand their fees in cash, greenbacks preferably, and many stores give you a sizable discount if you pay with cash -- saving them a tax bill.

"Compared with other countries, there's no doubt many transactions are done in cash in Argentina," said lawmaker Jorge Mario Alvarez, who has presented a bank security bill. "It's a habit ... maybe people just don't have much faith in electronic transfers."


The number of robberies targeting people as they left banks soared 40 percent in 2009 from the previous year, with about 400 taking place every month, Alvarez said.

Many end in violence and sometimes murder, either on the street close to the bank or in an ambush when victims reach their destination after being followed for miles by car or motorbike.

Banking executives say they have already invested in security cameras and guards to tackle robberies targeting their customers, and some say the problem will only be resolved if the government scraps a controversial levy on financial transactions that was imposed as an emergency measure in 2001.

"When you've got a financial transactions tax as high as we've got in Argentina, the incentive to do business in cash is very high," Mario Vicens, president of the Argentine Banks Association, said in a recent interview.

"If far fewer operations were carried out in cash, like in any country where bank transfers are more developed, this crime would be virtually nonexistent," he added.

In the meantime, more and more people are hiring armed guards to accompany them to the bank or finding other ways to beat the robberies, like the treasurer Lucia Gimenez.

"If (the suppliers) don't open an account, they have to wait for me inside the bank and I give them the money there," she said. "That way, they run the risk and I walk out carrying nothing."

($1 = 3.995 Argentine pesos)

(Additional reporting by Fiona Ortiz and Walter Brandimarte; Editing by Kieran Murray)


Anonymous said...

I stopped at a U.S. Walmart on the "not-so-good" part of town at 10:30 p.m. When the cashier held my 100 Dollar bill up in the light to verify if it was real or not, and again with a fifty for good measure, I felt as if every eye at the front of the store focused on me. It got real quiet too, I think you could've suddenly heard a pin drop. I've had a cashier check my money before, but the crowd never reacted before. Even the cashiers acted nervous. I half thought, I might have to run, WTF? Just played it cool tho, even when I saw the loud freaky people, who were pushing a shopping cart through the store yet were leaving with nothing, at the same time I was. It wasn't much but I exited through the opposite doors.

I was shopping monthly, I think I'll try shopping more often, get less, and man was it reassuring having a sharp knife just in case, some of the characters in the store were big, or shifty (and more importantly - in groups) and all around just plain freaky - WAA-KA!.

The stuff I learned in your book, on this blog, it's like a can of instructions which pop out when you need it like one of those surprise paper snakes. "You're doing this idiot, you know not to do this, so now do X to compensate, be quick about it."

Lergnom said...

Most businesses in Pennsylvania don't accept $50 or $100 bills. The ATM machines don't even dispense anything other than $10s and $20s.

David said...

If things get like that in the USA, I expect more than a few folks will consider an AR, AK, or Mini-14 as routine equipment for a bank visit.

Following such a person home after the bank could get VERY dangerous (I know people who could pick which eye to shoot out from 100 yds with an AR15).

Anonymous said...

The same thing with people only using cash emerged in the US during the first Great Depression, after most banks had failed and taken their customers' deposits with them. People hid cash in walls, commonly. Sometimes they forgot it was there and still today remodelers of old houses find boxes of antique notes inside walls and floors. It wasn't until after WW2 that people returned to the banks.

Argentina is far more violent than the US is even today to say nothing of the 30s, so distrust of banks puts people's lives at risk. But after massive bank closures and devaluations, people in any country tend to do everything in cash for quite a while afterwards.

For anon 11:30, bringing large bills to Wal Mart is generally not a good idea, as many of the shoppers are real dregs of society. We all have to go there, but using a prepaid debit card if you don't trust banks might be a good idea for Wal Mart. Shopping more often may be a good bet.

Angry Cow

Anonymous said...

"using a prepaid debit card if you don't trust banks might be a good idea for Wal Mart."

Prepaid debit cards, available at... Walmart? Or a bank? Kind of defeats the purpose a bit?

Anonymous said...

Convenience and security are the reasons some businesses in the United States no longer accept cash. This policy may or may not change after the SHTF when "bank holidays" and other draconian measures might be imposed by the Government.

The Merchants That Don’t Take Cash

Anonymous said...

Try shopping at 8 am or 9am ....why go at 10:30 pm

Target opens at 8 am, check it out!