Show me the money! On your Bitcoin dashboard…

Filthy lucre, cash, wonga, pound notes, dollar, bread…there was a time when all this vocabulary was as familiar to a car dealer as sheepskin coats and sovereign rings. Nowadays, of course, ‘real’ money has all but disappeared from the showroom. But when did it all change from the basic concept of trade and barter to PCPs, residuals and balloons, government regulations and organised crime? When – and why – did it all get so complicated?

‘How much for cash mate?’. There was a day when this was music to any trader’s ear, and the deal would be struck with much lip-licking, cheek sucking, and the reassuring rustle of a monkey, pony or marmot, or whatever animal the car cost (note to self: do more research for articles). This would usually be followed by a trip to the pub, and the simple calculation of the day’s profits – which may or may not be mentioned to Her Majesties’ collectors of taxes.

One of my earliest memories – in my first week – at Munich Legends was of being in an accounts meeting and being interrupted by a knock on the door. ‘That man wants to talk to you’ said our receptionist, pointing at a chap clutching a plastic bag as he wandered round the showroom. I sprung into action, keen to meet one of my first physical customers. ‘Can I help you?’ I asked – at which point the man turned around and immediately opened the carrier bag to show me the contents. ‘I have this’ he said, ’and I’d like to buy a car’. In the bag was a huge, untidy mass of bank notes. £50 notes. ‘I’m sure that can be arranged’ I replied. Of course, even then it wasn’t quite that simple.

In those days, the law said, you called SOCA – the Serious Organised Crime Agency. While the customer waited in the showroom, and without telling him or her of your actions, you were supposed to sneak into the office and basically explain that a man had just offered you a big bag of cash. That was it. If they wanted to follow it up, they could. But as you can imagine, mostly they just grunted and said they’d let you know.

Then one day I went to call SOCA, and the number was unavailable. Unwilling to lose a sale and having found no information on line, I took the cash – I think it was around £40,000 for an E90 M3 track car from memory – and banked it. Obviously, I went to the pub first, but I did declare the transaction, because I really hate the idea of doing weights in a prison yard.

After a few years in limbo – HMRC and the National Crime Agency (SOCA’s successor) offered no guidance at all – ironically it was our bankers that flagged up the new rule, in one of their box-ticking exercises. ‘Are you registered as a High Value Dealer?’ asked our bank manager on one of his pointless visits. It turned out that the new scheme applies to any car dealer who accepted cash – on one or more occasion – totalling more than £10,000. This makes you an HVD, and you have to register. Someone, usually a director, has to put their name to it, and you can go to prison if you get things wrong. We listened carefully (or at least Karen in accounts did, while I watched some paint dry) to the endless list of responsibilities, tasks, paperwork and obligations that came with being an HVD and immediately decided it wasn’t for us. Cash clients would have to go. But just as the Zoom was about to end, the HMRC people let one utter gem escape, which we hadn’t realised. The obligation to be an HVD, and all that went with it only applies to investment/ capital purchases. Like a car. It isn’t relevant for repairs, restorations, or services. We thanked them for their time, and declined the scheme.

Now, the last time we had a big insurance renewal, I read the terms applying to the transport of cash. If the cash we’re banking totals more than £7000, then it has to be accompanied by three members of staff. More than £10k is four. And they actually stipulate what staff are covered for, in the event they’re robbed and injured. If you lose an arm, you get £8000. I’m not making it up. You can see why cash has gone out of fashion. For this and several other reasons, I’m not a fan of cash, and its tempting to answer the question ‘how much for cash mate?’ with ‘that’ll be the usual price plus a 10% surcharge, please sir’. And that is a shame, because we work hard for our money. Why shouldn’t we be allowed to spend it freely?

Let’s just remember what this is all for. All these regulations were bought in after 9/11 to prevent terrorists from laundering money. I’m not certain Al Qaida will get very far in their World Domination Plan laundering ten grand chunks through a BMW garage in Chelwood Gate, but you never know, I suppose. The silly part is that if they really want to, they can buy a project car for £9000 cash, ask us to restore it for £70,000 in cash and then sell it on for £79,000, which I can pay direct into their bank account (or maybe a friend’s). That’s all legal. Even if we’d signed up as an HVD, there’s no reporting mechanism for that. You’d be forgiven for thinking that 9/11 provided a handy excuse for clamping down on tax avoidance, that the HVD scheme is more aimed at catching self-employed plumbers than suicide bombers. To be honest, I’ve not seen many Sport Evos on the front line in Libya.

And this is before we move on to the latest alternative to cash: Bitcoin. The world is now apparently awash with (usually) young (usually) men who’ve been playing around with crypto currencies and suddenly have (digital) money to (virtually) burn. At my wife’s company a Bitcoin guy paid €43,000 to rent a car from them for a month while he was in Europe on business. Bitcoin is even less traceable than cash, because you don’t even need to show a human form of ID to make it, store it or spend it. And there’s no need for ML to bother with HMRC and their silly HVD system because Bitcoin isn’t cash so it doesn’t apply. And crypto currencies are scary, because you really can use the system to rinse unlimited sums – yes, enough to build an army. And there’s next to nothing the established mechanisms, the World’s nation states, or the international banking system can do about it.

On the upside, dealers no longer need those sheepskin jackets, with their deep, cash ready pockets. On the downside, we spend less time in the pub. Maybe that’s a small price to pay, to be able sell cars to people who want to buy them.

Dan Norris, Straight Six Magazine by BMW Car Club GB (December 2021 issue)

Straight Six Magazine December 2021