[jbstack]

> I think people would be outraged if someone told them it belonged to the bank.

You might find it interesting to read about 2013 Cyprus bank levy then. The government unilaterally raided people's savings accounts, taking between 6.75% and 10% as a one-off tax with essentially no warning. When you put money in the bank you are implicitly accepting the (small but real) risk that the government will come along and say "I'm having some of that" and there's nothing you can do about it.

More anecdotally, I once had to help a family friend sue a bank for several tens of thousands of pounds in the UK because they refused to pay him back his balance when he closed the account and refused to explain the reason. It took a little over 6 months to get the money back. While researching the case, I discovered countless other cases in which businesses had gone bankrupt because of delays in recovering their money from the bank. Under UK legislation, banks can and do do this if they have "suspicions" of money laundering (which can be triggered for any reason whatsoever - the suspicion doesn't have to be reasonable). Not only do they not have to explain to the customer what those suspicious are, they are legally required not to. They can hold onto your money for up to 31 days and this can be extended to up to 6 months by a court order after a hearing which you will be excluded from and likely not even know took place until after the fact.

Legally you do not own your money in the bank. Instead you own a "chose in action" (https://en.wikipedia.org/wiki/Chose) which is the right to sue the bank for the money. Although it sounds similar to outright ownership, it's not the same thing.

[Dylan16807]

The government could also tax you an extra $5000 out of nowhere by pushing a law through. That levy happened to go for bank accounts but the general concept isn't tied to whether your money is stored personally.

Freezes are a big problem but they don't get to keep it. The delay is the problem, not a transfer of ownership.

[jbstack]

Nonetheless, there's a fundamental legal difference between ownership (e.g. of the notes and coins in your pocket) and a chose in action (the right to sue the bank for the money which you don't own).

If you own something and someone withholds it from you, in the general case that's theft. Because theft is a criminal offence, people generally won't risk doing it. With a chose in action, you have to sue in a civil court for damages. In the meantime, the bank might go bust, you might lose your case, you may give up without even going to court because the amount they've kept isn't worth the time and legal costs of recovery.

You've probably heard the phrase "possession is 9/10ths of the law". If the government introduces a no-warning one-time $5000 levy, they still have to recover the money from you. The effort of doing so is on them and they have the burden of proof. Maybe they will, maybe they won't. Maybe you'll decide to leave the country before the legal process concludes. These are some of the advantages of ownership.

When the money is in the bank, the bank and the government can simply agree (without a court's involvement) that you owe the $5000 and there is nothing you can do other than try to sue the bank (and likely lose) because you never owned the money in the first place. The burden of proof shifts to you and it's unlikely you'll ever see that money again.