Donald Trump has been sentenced without penalty in the New York hush money case and wildfires continue to burn through Los Angeles. Video / NZ Herald, AFP
Carl Halvorsen claims ANZ Australia charged $19,600 above wholesale rates when transferring $780,000 to his daughter in Perth.
ANZ has offered a $6610 goodwill payment to resolve the family’s concerns.
Kiwis are advised to negotiate with banks and shop around when sending large sums of money to Australia.
A Kiwi dad is in shock and losing sleep over what he calls “exorbitant” exchange rates charged by a major bank to transfer money to Australia.
Carl Halvorsen said ANZ Australia charged about $19,600 above the official wholesale exchange rates when his family wired NZ$780,000 to his daughter in Perth.
The family had been expecting something close to A$700,000 ($774,000) to arrive in his daughter’s account.
Halvorsen said when the family contacted the bank, they were disappointed to hear it explain that the bank’s exchange rate was the reason for the large difference.
“How many other Kiwis are getting struck like this?
“Even with a handling fee, this is exorbitant.”
Carl Halvorsen and his daughter Alex say they can't help but feel like they've lost money after using a major bank to transfer cash from New Zealand to Australia for a new house. Photo / Supplied
Halvorsen’s daughter is among tens of thousands of Kiwis to have moved across the Ditch in the past few years and had been building a new beginning out of recent family sorrow.
As part of the will, the family sold an Ōhope Beach home they owned, with the settlement completed in December.
The money was then transferred to enable Halvorsen’s daughter to buy her own home in Perth, with her dad also travelling to Australia for the expected arrival of her new baby in the coming weeks.
But when the family saw how much money had been lost on exchange, it left a bitter taste, Halvorsen said.
An ANZ spokesman told the Herald the bank encourages people to contact it for advice before sending large sums of money overseas.
He said the bank posts its latest “indicative foreign conversion rates” on its website each morning for customers to see.
It also has a website calculator allowing customers to understand the exchange rates and fees likely to apply and the amount expected to arrive in the recipient’s account.
However, 72-year-old Halvorsen said it had been the lawyers handling his daughter’s inheritance that made the transfer, not him.
On the day of the December 13 transfer, Halvorsen noted the official Reserve Bank of Australia exchange rate had one Aussie dollar buying 1.1038 Kiwi dollars.
From wild dolphin swims to quirky bars, Perth offers an unrivalled blend of adventures. Photo / 123rf
At that RBA rate the family’s $779,995 would equal about A$707,000, meaning Halvorsen had expected a typical retail rate and fees to leave them with something close to A$700,000, he said.
However, a letter from ANZ Australia after the transaction stated the bank had charged a flat A$15 fee along with a conversion rate of 1.1353, resulting in A$687,012 being transferred.
The family have since complained to the Australian Financial Complaints Authority.
In a letter to Halvorsen’s daughter acknowledging the complaint, ANZ said it was willing to work towards resolving the family’s “concerns”.
As such, it offered them a “goodwill gesture payment of $6610”, which the family had seven days to accept.
The bank said it had not made any errors in the case.
However, it noted that if on the day of the transfer the family had asked ANZ staff about the market rate, they could have instead been offered a better rate, resulting in the $6610 difference.
The letter also gave “additional information” about exchange rates.
It said official exchange rates often quoted online and in media are wholesale prices for transfers between banks and not available to retail customers.
Banks and dealers instead added margins to protect themselves should the wholesale rates change dramatically during the day, the letter said.
Claire Matthews, associate professor at Massey Business School, said people moving large sums of money overseas should seek financial advice.
Carl Halvorsen and daughter Alexa are moving on from the sorrow of losing Carl's wife last year to Alexa now buying a new home in Perth as she expects a new baby in the coming weeks. Photo / Supplied
Lawyers, for instance, are not financial experts nor are they expected to be, she said.
People should go directly to their bank or foreign exchange dealer to negotiate and look at the conversion rates they are offering, rather than look at the wholesale rates.
Not only could conversion rates fluctuate from day to day, they could change from dealer to dealer and even be different depending on whether the money is exchanged in New Zealand or Australia, for instance, Matthews said.
Expats posting on Facebook pages, such as Kiwis moving to Aussie and Kiwis Moving to Melbourne (Original), backed her advice.
Posters on both sites recommended negotiating with banks, while many others recommended using online foreign exchange dealers, such as Wise or XE, which they said offered better rates.
Halvorsen, meanwhile, has been struggling to sleep as he can’t help but think that while not illegal, the conversion rate has left him personally feeling like he’s being wronged.
“To me it is a case of a major bank scamming their customer while at the same time advising customers on how to avoid scams,” he said about his feelings.
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