Full Text Available
Note: Clicking the button above will open the full text document at the original institutional repository in a new window.
A bank’s right to terminate its relationship with its customers in light of reputational risk
Mini Dissertation (LLM)--University of Pretoria, 2020.
Saved in:
| Other Authors: | |
|---|---|
| Format: | Thesis |
| Language: | English |
| Published: |
University of Pretoria
2021
|
| Subjects: | |
| Tags: |
No Tags, Be the first to tag this record!
|
| _version_ | 1867613495978098688 |
|---|---|
| access_status_str | Open Access |
| author2 | Brits, Reghard |
| author_browse | Brits, Reghard |
| author_facet | Brits, Reghard |
| collection | Thesis |
| dc_rights_str_mv | © 2019 University of Pretoria. All rights reserved. The copyright in this work vests in the University of Pretoria. No part of this work may be reproduced or transmitted in any form or by any means, without the prior written permission of the University of Pretoria. |
| description | Mini Dissertation (LLM)--University of Pretoria, 2020. |
| format | Thesis |
| id | oai:repository.up.ac.za:2263/78528 |
| institution | University of Pretoria (South Africa) |
| language | English |
| last_indexed | 2026-06-10T12:37:03.713Z |
| license_str | Other — see source repository |
| provenance_str_mv | Harvested via OAI-PMH from UPSpace — University of Pretoria Institutional Repository |
| publishDate | 2021 |
| publishDateRange | 2021 |
| publishDateSort | 2021 |
| publisher | University of Pretoria |
| publisherStr | University of Pretoria |
| record_format | dspace |
| source_str | UPSpace — University of Pretoria Institutional Repository |
| spelling | oai:repository.up.ac.za:2263/78528 A bank’s right to terminate its relationship with its customers in light of reputational risk Brits, Reghard edwardjr.hayes@gmail.com Hayes, Edward Jnr UCTD Reputational risk Anti-money laundering (AML) Contact law Banking law de-risking Financial Intelligence Centre Unilateral termination of contract Fusion Centre SAMLIT Mini Dissertation (LLM)--University of Pretoria, 2020. This dissertation examines a bank’s right to unilaterally terminate its contractual relationship with a customer on the basis of reputational risk. The law of contract allows a bank to terminate the bank-customer agreement when the customer is in serious breach of the contract. Over the years, however, a pattern has started to develop by which a bank can unilaterally terminate the bank-customer relationship of high-risk customers based on reputational risk. Banks are reluctant to facilitate the transactions of individuals surrounded by negative publicity, due to fears of how the bank’s investors, customers or counterparts might perceive the bank. Compliance with anti-money laundering (AML) and counter financing of terrorism (CFT) requirements, as set out by both domestic and foreign legislation, results in higher costs for the bank. As such, the profitability of a particular bank-customer relationship may ultimately decline to such an extent that the bank rather decides to make an appropriate business decision by terminating the relationship. Correspondent banking relationships are agreements in terms of which one bank will provide services for another in jurisdictions where the first bank lacks a physical presence. As such, whenever there is a perception that a local bank does not comply with the relevant AML/CFT laws as set out by its domestic legislation, the correspondent bank might decide to terminate its relationship with the local bank, leaving the latter financially excluded from the correspondent banking market. Such a situation would hinder the growth of the South African economy and may also cause a systemic event in the financial industry. Adequate customer due diligence (CDD) measures assist a bank in formulating a clear understanding of the business of its customers. The information obtained through CDD may also assist the bank in determining the reputation of a particular customer. This information can also assist law enforcement in combatting financial crimes. In this regard, it is recommended that a bank should be able to trace the information that was shared with Financial Intelligence Units (FIUs) and law enforcement agencies, so that the bank may reasonably determine the level of reputational risk involved in the relationship. Mercantile Law LLM Unrestricted 2021-02-12T10:03:50Z 2021-02-12T10:03:50Z 2021-04-04 2020 Mini Dissertation Hayes, EJ 2020, A bank’s right to terminate its relationship with its customers in light of reputational risk, LLM Mini Dissertation, University of Pretoria, Pretoria, viewed yymmdd <http://hdl.handle.net/2263/78528> A2021 http://hdl.handle.net/2263/78528 en © 2019 University of Pretoria. All rights reserved. The copyright in this work vests in the University of Pretoria. No part of this work may be reproduced or transmitted in any form or by any means, without the prior written permission of the University of Pretoria. application/pdf University of Pretoria |
| spellingShingle | UCTD Reputational risk Anti-money laundering (AML) Contact law Banking law de-risking Financial Intelligence Centre Unilateral termination of contract Fusion Centre SAMLIT A bank’s right to terminate its relationship with its customers in light of reputational risk |
| title | A bank’s right to terminate its relationship with its customers in light of reputational risk |
| title_full | A bank’s right to terminate its relationship with its customers in light of reputational risk |
| title_fullStr | A bank’s right to terminate its relationship with its customers in light of reputational risk |
| title_full_unstemmed | A bank’s right to terminate its relationship with its customers in light of reputational risk |
| title_short | A bank’s right to terminate its relationship with its customers in light of reputational risk |
| title_sort | bank s right to terminate its relationship with its customers in light of reputational risk |
| topic | UCTD Reputational risk Anti-money laundering (AML) Contact law Banking law de-risking Financial Intelligence Centre Unilateral termination of contract Fusion Centre SAMLIT |
| url | http://hdl.handle.net/2263/78528 |