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In order to exercise a stock option, I find myself needing a USD cheque. Annoyingly, it has to be a cheque and it has to be in USD, neither a GBP cheque nor a USD wire transfer are acceptable. (I've triple checked, but they won't budge)

I've read through some of the past questions on the best way to turn GBP into USD, but they don't seem to help that much as I don't have an account that would let me deposit a USD denominated wire transfer and turn it into a cheque.

One option might be to open a USD denominated account with a UK bank, which I think I'd have to pay some fees for, get a cheque book with that, follow the advice on the best way to turn GBP into USD, deposit the USD into that and write a cheque. This would seem to allow for a good exchange rate, but it would seem a lot of fees in the process.

Asking a UK bank to issue a USD cheque looks to be out, as they all seem to offer very poor exchange rates (large commission/spread), and then want a large fee for issueing the cheque.

Is there another way to do this that I'm missing? Or are there banks that offer low/no fees for either a USD account or for doing the transfer+cheque?

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Do you have any friends in the States who owe you a favo(u)r... :-) –  Steve Melnikoff Sep 28 '12 at 15:17
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I did ask one, but they were concerned about how it'd look to the IRS if they were audited... –  Gagravarr Sep 28 '12 at 16:53
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1 Answer 1

up vote 3 down vote accepted

UPDATE: Unfortunately Citibank have removed the "standard" account option and you have to choose the "plus" account, which requires a minimum monthly deposit of 1800 sterling and two direct debits.

Absolutely there is. I would highly recommend Citibank's Plus Current Account. It's a completely free bank account available to all UK residents. http://www.citibank.co.uk/personal/banking/bankingproducts/currentaccounts/sterling/plus/index.htm

There are no monthly fees and no minimum balance requirements to maintain. Almost nobody in the UK has heard of it and I don't know why because it's extremely useful for anyone who travels or deals in foreign currency regularly.

In one online application you can open a Sterling Current Account and Deposit Accounts in 10 other foreign currencies (When I opened mine around 3 years ago you could only open up to 7 (!) accounts at any one time).

Citibank provide a Visa card, which you can link to any of your multi currency accounts via a phone call to their hotline (unfortunately not online, which frequently annoys me - but I guess you can't have everything). For USD and EUR you can use it as a Visa debit for USD/EUR purchases, for all other currencies you can't make debit card transactions but you can make ATM withdrawals without incurring an FX conversion.

Best of all for your case, a free USD cheque book is also available: http://www.citibank.co.uk/personal/banking/international/eurocurrent.htm

You can fund the account in sterling and exchange to USD through online banking. The rates are not as good as you would get through an FX broker like xe.com but they're not terrible either.

You can also fund the account by USD wire transfer, which is free to deposit at Citibank - but the bank you issue the payment from will likely charge a SWIFT fee so this might not be worth it unless the amount is large enough to justify the fee.

If by any chance you have a Citibank account in the US, you can also make free USD transfers in/out of this account - subject to a daily limit.

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That's not quite correct about it being free with no requirements - it's only free if you pay in £1800/month and have two direct debits, otherwise it's £8/month. Also, you can pay into it in USD via New York for no fee from any US bank, routing details are in the front of the USD chequebook. –  Gagravarr Dec 13 '12 at 2:29
    
Interesting. This was not the case when I opened mine. I have had the account for three years, I only have one direct debit and I've never paid anything like 1800 GBP a month into it. I've not been charged any monthly fee that I know of to date. Will do some digging. I didn't realise it had an ACH route code, that's very useful information. Will have to try a payment out and see if it works. –  thepassiveinvestor Dec 13 '12 at 6:04
    
Looks like your right. When I applied there was a 'standard' account which had no minimum requirements, but that appears to have surreptitiously disappeared since then. What a shame. I've checked and there's been no charges on my account, I can only assume that I've grandfathered in the original terms. –  thepassiveinvestor Dec 13 '12 at 11:43
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