Immigrants to Israel fleeing the Russia-Ukraine War are still being denied by banks the ability to transfer assets from their former countries, according to NGO demands released Wednesday – though the situation has improved with a Monday policy paper from the Association of Israeli Banks, Pearl Cohen Law firm attorney Anna Moshe told The Jerusalem Post in an interview on Wednesday.In the past year, Israel reported that it received almost 80,000 immigrants in the wake of the war in Ukraine, Moshe said, but these people face “an unbelievable obstacle from the banking system to transfer their life savings, the compensation they got for selling their apartments or cars or businesses or the dividends, and to start their life over.”Moshe, who has been representing the NGO Reboot Startup Nation and high tech companies established by olim on this issue, explained that Israeli banks were fined heavily under 2014 Obama administration sanctions over the Russian annexation of Crimea.
Banks weary of registering Ukrainian refugees
The banks remain cautious, and are consequently denying the new citizens and transferring companies banking services. Moshe said that some of these immigrants have taken their families and companies and moved elsewhere after being unable to use their assets.“We’re talking about people that have nothing to do with any of the sanctions applied by the US,” said Moshe. Even when people explained to bankers that they had no relation to sanctions, they were denied.
“The banking system must take steps based on customers’ needs in regard to making information accessible in those languages and the customers’ approach to obtaining banking services at the banking corporation’s branches. In terms of a customer’s request to transfer money through an entity that does not appear on the list of entities subject to sanctions, I would like to clarify that the request should be considered in accordance with the circumstances and nature of the request.”
Yair Avidan, Bank of Israel
Knesset Immigration, Absorption and Diaspora Affairs chairman Oded Forer was credited by Moshe for his “unbelievable” work to address the issue by calling a special meeting of the committee and coordinating with Moshe and the Bank of Israel.“He is the father of this project,” she complimented Forer.Moshe provided recommendations, while acknowledging the risks involved for the banks. She said that they had asked for written answers from banks to explain what they needed to facilitate asset transfers, instead of blanket denials. They also discovered in their surveys that banks differed in their approach to these issues – there were no unified policies.“We’re not against the banking system,” said Moshe. “We’re just trying to bring the two together and create active communication.”Moshe explained that her clients were coming to Israel without social assets from having been raised in the country – they might not know how to get an Israeli lawyer or how to approach an Israeli bank, let alone have the proper tools available in accessible languages.Yisrael Beiteinu leader Avigdorg Liberman also contacted the Bank of Israel asking for consideration.On February 2, Bank of Israel’s supervisor of banks Yair Avidan issued a guidance to banks regarding the denial of services to new immigrants. The letter called for the implementation of the movement’s recommendations.“The banking system must take steps based on customers’ needs in regard to making information accessible in those languages and the customers’ approach to obtaining banking services at the banking corporation’s branches,” wrote Avidan. “In terms of a customer’s request to transfer money through an entity that does not appear on the list of entities subject to sanctions, I would like to clarify that the request should be considered in accordance with the circumstances and nature of the request.”Moshe extolled the Bank of Israel for its elaborate guidelines on the issue.“They gave some guidance and now it’s up to the bank to actually implement,” said Moshe. “And the implementation, as always, is the tricky side because there are no timelines for implementation.”Moshe’s clients are still given barriers with long waiting times before the banks answer them on what documents are needed. One businessman was told that he would receive a response within 45 days. Coming with families, some are unable to invest such time and must go to other states. Others are encountering issues about documents about where they live being an issue – but during these early immigration periods they are in uncertain accommodations.On March 20, Reboot Start Up Nation said that the banks had still not implemented the guidelines. On May 2, the Association of Israeli Banks released a document on the required documents needed for banking under the specter of sanctions.Moshe said that more needs to be done. Each bank manager should know how to check who or what is under sanctions. Israeli banks need to be able to correspond with private Russian banks that are not under sanctions.Reboot Start Up Nation issued an updated list of demands as part of their “fair baking project” on Wednesday. The NGO asked for timelines for responses, a list of reasons for refusals of services, more required document lists, an appeals process, more language services across banking interfaces and guidelines for small cash deposits.Moshe said that the current regulations are causing people to take their money, assets, families and companies to other countries.“More than 80% are with high education. We’re talking about 50-60% under the age of 50. A lot of them are under the age of 35. We have around 17,000 children under the age of 17,” said Moshe. Many speak fluent English, are wealthy, and are connected to businesses.Moshe said that as a zionist, it frustrated her to see so many potential assets to the state of Israel go elsewhere.The next step needed, she said, may be legislation to implement the last of the recommendations for improvement.