Anonymous accounts to be closed for good


The international fight against money-laundering has become increasingly urgent since the events of September 11th. Countries throughout the world are being asked to toughen their banking regulations; those countries that don't are put on a blacklist drawn up by the OECD, the Organisation for Economic Co-operation and Development. The Czech Republic is one of the countries that risk being put on that blacklist - if it fails to outlaw so-called "anonymous savings accounts." Rob Cameron has more.

The way an anonymous savings account works is quite simple. The account holder is given a little book, containing details of deposits and withdrawals. But there's no name on the book, and the account holder doesn't have to sign anything when he deposits or withdraws money. The account holder can give the book to someone else, and that person can also deposit or withdraw money without being asked to prove his identity. Some anonymous accounts are protected by a password, others aren't.

It needs little imagination to realise how the system could be abused, especially by professional money-laundering gangs moving huge sums from one bank to another. Organisations such as the OECD and the European Union - which the Czech Republic plans to join in less than two years' time - have urged countries to do away with the accounts or face sanctions. Only two other countries in Europe - Hungary and Austria - still provide anonymous accounts, and they are working hard to phase them out by the end of this year, so they can be removed from the money-laundering blacklist.

In the Czech Republic it's been impossible to open a new anonymous savings account since 2000, and the lower house of parliament recently passed new legislation to close the existing ones. If the bill is approved by the Senate, all existing accounts will be frozen on January 1st, 2003. Account holders will have ten years in which to close the account and withdraw their savings, or move them somewhere else.

But while the phasing out of anonymous savings accounts is popular with analysts worried about the Czech Republic's credit rating, it will be less so with the people who actually own them. A staggering 120 billion crowns - just over 3 billion US dollars - is deposited in millions of anonymous savings accounts across the country, mostly provided by the Ceska Sporitelna savings bank. Many account holders are elderly people, who could be confused and upset when told to close them, so doing away with anonymous accounts once and for all will be a difficult task.