Communicating to us in response to a general question about our MM2H application, our agent just informed us of new rules effective November 1st, 2014 involving documentation. Affecting mostly American citizens due to the nature of very strict privacy guidelines that all U.S. banks must follow, Diane and I are moderately concerned but still plan on selling the house in March and settling somewhere in Southeast Asia, even if it’s Thailand (our Plan “B). Deciding to choose “selected” applicants and subject them to an extra verification letter that U.S. banks normally wouldn’t issue, the Ministry has made our overseas experiment a bit more intriguing.
Reviewing the basics, The Malaysia My Second Home (MM2H) is a government program that allows foreigners unrestricted multiple entries into Malaysia for a ten-year period, renewable indefinitely. Differing slightly from a residency visa, the MM2H is a social visit pass and comes with certain benefits including exemptions of import duties and sales tax for car purchases and the right to own property. Designed mostly for middle class retirees and prohibiting most work, financial requirements are high. Unlike Thailand, however, the ease and convenience of a long-term stay with no “border runs” every few months coupled with a highly developed infrastructure makes the program highly desirable.
Allowing applicants to file while overseas in “do it yourself” fashion or through the services of a licensed agent, debate rages on and on about what option is the better choice. From personal experience I can say that while it’s not impossibly difficult, overseas applicants are probably better utilizing the services of an agent to avoid ambiguous issues not covered on the government website such as certain definitions. Formerly a British colony, the rules and guidelines are very geared towards Europeans, Australians, New Zealanders and other commonwealth nations whose banking rules are much more lenient than the United States.
Utilizing what we believe to be the best professional and certainly the most knowledgeable agent available, we’ve contracted with Joy-Stay. Their website is here and a quick summary of requirements is found by clicking here.
Summarizing the issue, most Americans are aware that the United States has the tightest and strictest privacy banking rules of any nation, mostly due to partially justifiable safeguards designed to prevent money laundering and terrorist funding. Requiring verification of income, MM2H applicants present three months of financial statements as verification of adequate “cash-in-hand” (Currently about $110,000 USD for those over age 50). Current income guidelines also apply but go away forever once approved.
Drawing the fine line between what is an “original” statement and a “certified true copy” is a hard enough battle as the Malaysian government is very fond of physical pieces of paper with colors and graphs, mostly now non-existent in America, In addition, they ask for an “original letter with company stamp and valid signature” to verify the legitimacy. Harkening back to the golden age of pre-9/11 innocence, most Americans can’t remember the last time they walked into a brick and mortar bank, never mind trying to set up a relationship with a branch manager.
After much discussion with Bank of America’s clerical staff, I learned that the only way to get verification of my accounts is through a centralized customer service center via a template that’s mailed directly to a branch. Overly protective rules apparently make it hard for an American banking client to obtain written information on their own assets except for special purposes. Eventually, I was given a axed copy of a letter with my accounts and their balances but no official signature, stamp or pretty colors.
Moderately more cooperative, TD Ameritrade was able to email a PDF attachment with the required information because brokerage firms don’t fall under such tight regulation as banks. Explaining that America simply doesn’t do business by personal letters, stamps or even by physical paper proved difficult and we exchanged many emails until agreeing on a template that the Ministry would find acceptable. Knowing now that the application would never be acceptable had I wasted money sending something incomplete, I highly recommend the use of an agent for any American thinking of starting the application process.
Probably the most ridiculous rule involves the “verification of the verification”. After sending all the above plus all the other various documentation, applicants are then asked to give a name and address of someone at the financial institution along with the application. Expectations are that the Ministry then mails (not even by courier) a form letter to the address provided and expects your financial institution to present a formal letter verifying the information already provided to them in the first step. Could it be any harder?
Although the rule has always technically been in place, the ministry apparently understands the stringent bank rules and has never rejected an American applicant on the basis of not receiving a response. Realistically, this means they bypass this step as a courtesy to American government regulations. Understanding it’s simply not fair to ask documentation prohibited by statute, they have made other exceptions. (For example, California law prohibits “certified true copies” except by subpoena or court order so they allow something called a “jurat” in place of a notarized copy).
Thinking everything was now just a waiting period for the three months before my 50th birthday, Diane and I wrote a routine email on an issue unrelated to the application and got this response from Joy-Stay:
The MM2H Centre announced the following new rules effective from November 2014 (Please read to see if they are applicable to you) :
Bank Verifications – The Ministry only accepts financial documents which applicants confirm that they can be verified by our Ministry directly with the relevant parties who issued the financial documents.
– If your banks or financial institutes do not reply to the Ministry, your application will not be processed and will be declined after the Ministry has sent the letters two times to the relevant banks/financial institute.
Obviously concerned, I asked for clarification. Visibly upset by the change, our agent expressed frustration with the Ministry’s process but nonetheless explained they have begun “randomly” selecting applicants last week and one of her current applicants that’s field already will be her guinea pig (my words, not hers). Further clarifying, we’re told they’ve even involved the Malaysian Embassy and Consulates, probably in a misguided effort and under the assumption that their foreign based representative can somehow influence US banking and privacy rules.
Informed that the processing time remains three months assuming our application is not “chosen for selection”, she asked us to be patient while they learn exactly what the new regulations will mean from their point of view. Knowing this is the best agent in Malaysia with obvious good contacts at the relevant agencies, I can only speculate why they’d choose to jeopardize American applicants after successfully allowing thousands to emigrate with little or no hassle. Refusing to get political or negative, I’m reserving comment and instead focusing on our next move should we be “randomly selected”.
Given one full year of House Husband duties and almost no responses to anything I’d left on internet job sites after my unexpected layoff, there’s no turning back now. Detailing the start of a fall cleanup project our real estate agent deems necessary in my last post, our commitment to get Diane retired from work and go somewhere remains intact. Hopefully the Malaysian government will understand the ramifications of a program that excludes Americans from inclusion due to government privacy rules designed to keep the USA safe from harm. Realizing the power of the internet, blogging and even foreign investment into a country that’s a whisker away from “fully developed status” will be necessary if the current government expects continued economic success
Meanwhile, Diane and I have re-examined flying to Thailand as an option once we close escrow while we wait for our application. Ah, how I long for the days of Richie Cunningham. Or at least Richard Nixon.
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