China Cash Transfer ‘Hoax’ Plays Into Bank Run Fears

Monday, January 27, 2014
By Paul Martin

Concerns over capital controls send jitters through market

Paul Joseph Watson
January 27, 2014

A false story published by Forbes yesterday which claimed that China’s commercial banks had been instructed to suspend cash transfers played into very real fears about bank runs and capital controls that are sending chills through the market.

The original article by Forbes’ Gordon Chang, now deleted, claimed that, “The People’s Bank of China, the central bank, has just ordered commercial banks to halt cash transfers,” with specific reference to to Citibank’s Chinese branches.

Citibank China Customer Service soon dismissed the story, leading China Compass to report, ” The PBOC has not—repeat not—asked Citibank to stop customers from wiring funds. Customers can still log on to their account to put in fund transfer requests at any time. The receiving bank (non-Citibank) will process the funds to be transferred on the next business day, as it always does. Because of the Lunar New Year break, the next business day is Friday Feb. 7. This is no different from the practice of banks throughout the world. Chang’s understanding of Chinese culture evidently does not extend to the timing of bank holidays.”

In reality, cash transfers are not being suspended, they are merely being delayed as is normal due to the Chinese spring festival bank holiday.

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