Questions & Answers
Client exit letter by the bank and forcing to convert currency
I received an exit letter from the bank for my corporate bank account after 3years of clean and smooth relationship with the bank.
We are Dubai based and in a free zone. I have 7 days to dispose of the funds which is alright but I am being told verbally that the bank would not accept to transfer the foreign currency as it is but we would need to convert them into AED.
The concern is that if I do so the company will incur a huge loss. Is the bank allowed to impose the conversion of all foreign currency? What is the way out, please?
Appreciate your legal advice.
Dear Sir/Madam,
Many thanks for your enquiry.
Several business owners each year receive these bank account termination letters.
At times, it is due to not maintaining the required minimum balance, other times it is a result of the manner in which the account is being managed, expired business licences, too many returned cheques, or doing business with blacklisted or sanctioned countries.
Nevertheless, the banks do not give reasons at the time of termination. My recommendation is you visit your branch and ask to speak to the branch manager about the best way to deal with the foreign currency to limit loss.
If the manager is not helpful, lodge a formal complaint with the bank. Thereafter, I recommend you immediately file a further complaint with the UAE Central Bank. The UAE Central Bank has an office in Dubai.
I would advise you to visit their office personally and take any relevant documents with you. I trust that you will find my advice helpful.
Best regards,
Jennifer Arkhurst
