By Alicia Maher
Spain’s apex bank (the Bank of Spain) has explained that certain actions can cause some bank users’ accounts to be restricted. It further explained that financial institutions could block certain transactions that they deem to be suspicious. The apex bank explained via a lengthy blog post that financial institutions have the authorization to block any bank account suspected to be involved in any illegal financial transactions such as money laundering or stealing.
Why Some Crypto-Related Bank Accounts Were Restricted
The apex bank also explained that it authorized Spanish financial institutions to block any user bank account involved in any crypto transaction. The bank claimed that one of the reasons it authorized traditional banks to block accounts involved in crypto transactions is that no Spanish or European financial policies allow digital assets to be used for payment settlement or investment alternatives.
Part of the apex bank’s blog post reads, “a bank can block an account when it suspects any case of identity and credential theft. Several commercial banks have received several notices of their customers reporting that their accounts have been hacked. Then, after monitoring the movement of the funds, the banks usually discovered that most of these funds were used to purchase digital currencies.”
The banks concluded this because it has a trigger system that alerts the bank of any crypto purchase from a bank account. Hence, once this trigger system identifies such purchases, it blocks the customer’s account instantly as a first measure to protect the customer.
Other Causes Of Bank Account Restriction
The post further explained other reasons that might cause a bank to restrict a user’s account. It cited suspected transactions involving money laundering as a possible cause. However, the post further clarified that not all such accounts would be permanently blocked. The bank usually requests additional information from a user whose account is involved in transactions classified as “high risk.”
Hence, the bank will likely call the account owner or ask them to make a physical appearance at the bank to ensure that the account owner is the one making the transaction and their identity hasn’t been stolen.
The bank of Spain further stated that commercial banks are obligated to comply with several financial laws so that they won’t be guilty of enabling financial fraud or financing terrorism because of their customers. The apex bank also affirmed that banks will always unblock any account whose owner can verify that their identity hasn’t been stolen or their account hasn’t been hacked.
It added that “the commercial banks are encouraged to use their discretion in blocking an account permanently or unblocking accounts in cases where the customer’s location is far from the bank or customer is in ill-health.” As of this writing, Europe’s bank chiefs are developing a policy to regulate the crypto market. The policy, known as MICA, will roles of financial institutions on digital assets and players in the crypto space.
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