[ Bloomberg ] China is blocking fleeing Hong Kongers from getting their retirement money
As tens of thousands flee Hong Kong for a new life in the UK, they’re confronting the risk that they will be forced to leave behind their retirement savings as China intensifies its crackdown on the city’s freedoms.
Scores are being denied access to money in the Mandatory Provident Fund because of the cascading impact of Beijing’s decision in January to withdraw recognition of British National Overseas passports as valid official documents.
The city’s retirement fund has told account providers that these passports can’t be used to prove departure from Hong Kong, a pre-requisite for early access to funds. Trustees, which include major institutions like HSBC Holdings Plc, Manulife Financial Corp., AIA and Sun Life Financial Inc., now aren’t allowed to release the money to those who’ve relocated on the passports.
Prior to the change in rules, Bank of America had estimated that retirement fund outflows due to migration to the UK would amount to HK$53.8 billion over the next five years. Before Hong Kong stopped recognising the passports, MPF withdrawals on the grounds of permanent departure had jumped more than 40% to a record HK$3.87 billion for the six months ended March from the same period a year ago, according to figures from the fund.
Financial institutions say they have no choice but to block access to the MPF money, and that they are obliged to follow local laws — an example of the thorny environment companies operating in the city are being forced to navigate.
DPA Notes: Nothing short of disgusting.
But this is what you get when anyone is in the crosshair of China. Unfortunately, this is a consistent theme in almost all our observations with anything to do with China.