Only a gigantic troll or a complete idiot would say that a company complying with anti-money-laundering regulations "raises a red flag." Sure it's inconvenient, but you're placing the blame at the wrong doorstep. This is one of the problems that Bitcoin solves very well, which makes every use of an exchange to obtain USD or some other fiat currency terribly ironic.
I've been a customer with MtGox for over a year.
More than a week ago they put my account under 'pending review'. I submitted the requested documents. I have followed up with emails. I am in their problem ticketing system and I am still unable to withdraw even one btc.
I don't know if that "raises a red flag" but it sure is an inconvenience and poor customer service.
I am suspicious of any money-handling business which unexpectedly shows difficulty in paying out funds. (This includes PayPal. But at least they have stated policies. I wonder if Mt. Gox is running short of cash when something like this happens.)