Banks block payments to crypto exchanges – Telegraph.co.uk

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Banks are cracking down on transfers to cryptocurrency exchanges by suspending payments to the sector amid rising fears that it has become a hotbed for financial crime.

Customers of banks including Barclays, Monzo and Starling are among those to have been blocked from transferring money to cryptocurrency platforms such as Binance and SwissBorg in recent weeks.

Starling, the online bank, has gone the furthest by suspending all payments to cryptocurrency exchanges after noticing “high levels of suspected financial crime with such payment”.

A spokesman said: “This is a temporary measure that we’ve taken to protect customers.

“This is not just an issue for Starling, but for all banks. We apologise for the inconvenience that this has caused for some customers; we will be reversing this measure as we roll out additional checks specifically for payments to crypto exchanges.”

Cryptocurrency users have been taking to social media in recent days to complain about the various crackdowns.

One Barclays customer wrote on Twitter that they had been locked out of online banking after trying to transfer a large amount to Binance. “Took two 90-minute phone calls to be able to get the transfer done,” they said.

A Monzo customer who was told they could not transfer to SwissBorg wrote: “Does anybody know a bank I can switch to that doesn’t act like Big Brother telling me who I can send money to?”

After a Starling customer complained on Reddit that their cryptocurrency transfers had been blocked due to the new ban, a user responded: “I can imagine this is going to be becoming more and more common for crypto users.”

NatWest last week warned its customers about cryptocurrency scams, saying it had received a record number of reports about fraud in the sector between January and March 2021. A spokesman declined to comment on whether the bank was flagging cryptocurrency platforms as suspicious.

Concerns about the rise of cryptocurrency crime have been growing in the UK amid fears that the digital coin space is lawless and extremely high risk.

The Financial Conduct Authority (FCA), which has warned consumers investing in cryptocurrencies that they should be prepared to lose all their money, had been due to ban cryptocurrency firms not on its official register under money laundering regulations from January, but having only processed four firms by that deadline it ended up placing others on a temporary register until July 9.

Last week the advertising watchdog banned an advertisement that had appeared on the London Underground for “irresponsibly” encouraging Bitcoin investments.

John Glen, City minister, on Tuesday told Tory MP Philip Davies that a “significant number” of firms in the cryptocurrency sector have failed to implement appropriately robust anti-money laundering controls or to employ fit and proper personnel. As of last week, only five cryptoasset businesses have received registration from the FCA since January 10 2020.

Monzo declined to comment while a Barclays spokesman said the bank had not blocked customers from interacting with cryptocurrency platforms.

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