Just a few weeks ago, I sold my house and car in the United States. Now I am going through the reverse of that process, acquiring a new home and vehicle. Those acquisitions, though, require some cash. Getting access to the money poses a series of problems. The money from those sales last fall is
- located on the other side of the world,
- governed under a different set of laws and regulations, and
- denominated in U.S. Dollars rather than South African rand.
I wrote previously about wiring money from the United States to South Africa. The $50 wiring fee is not such a big deal when you’re moving hundreds or thousands. The exchange rate offered by the bank for account-to-account wires, though, is a bigger deal; if the bank doesn’t compete with others to win your business, why would it feel pressure to give you a good rate of exchange?
One solution to this problem is a foreign exchange company. I read up on potential brokers at a site devoted to their evaluation. I decided to work with one called “Currencies Direct,” and I’m glad that I did. I set up an account with them before leaving the United States. Essentially I send them dollars, we establish a contract for a particular exchange rate, and then they send the money to my new account in a different currency.
An additional problem soon emerged, though. During my long conversations with SunTrust before my departure, the banker should have notified me that I needed a PIN number issued through Western Union to trigger international wires when I was no longer able to appear at the branch in person. I have looked for a good URL to describe this process, but I haven’t found it.
The banker neglected to do that, and a nasty impasse developed. During a week of increasing tensions, I discussed this situation with the international toll free clerks, the wire fraud people, the staff at my old bank branch, the secure messaging folks, and even the bank’s Twitter customer service desk. By that time, at least twenty people in the bank knew that I was about to transfer money for a house purchase out of my account. All of them expressed their condolences that my money was inaccessible to me, but nobody had a plan for how to accomplish it. I have made it clear to the bank that I will remove the remainder of my funds as soon as I return to the United States; as I put it to the customer service people, “you had one job.”
My bank had made the wire impossible, so I used an alternate route. Currencies Direct set up a type of account that allowed me to send a check to the company in the United States in dollars. They would then wire the corresponding amount to my account in South Africa using rand. I sent the check by express mail using the “bill pay” feature of the bank website. The bank repaid my effort by immediately slapping a freeze on the account, disabling my web access (and thus my secure messaging) and preventing the check’s delivery. I had a very hectic 24 hours re-establishing contact with the bank (aided by a friend giving me access to Google Voice), and then they released the check and opened my web access once more. The fee for express mailing was entirely wasted due to my bank’s efforts to “protect me.”
You should be aware that South Africa has significant laws in place to prevent money from flowing freely out of the country. As a foreigner, you must document every transfer into the country (SWIFT messages and bank statements) to ensure that you will be allowed to transfer that money back out of the country without limitations or extra taxes.
My funds arrived at Currencies Direct last week, and I locked down my exchange rate just before the President of South Africa fired the respected finance minister, causing a terrible plunge in the rand’s value. Some of the damage was undone when the replacement minister was sacked within four days and replaced by a new, respected finance minister.
If you are planning to spend considerable time in another country, be sure that your mechanism for transferring money is entirely in place before you leave.