How not to get your bank account blocked when dealing with cryptocurrency

How not to get your bank account blocked when dealing with cryptocurrency

The Central Bank has recommended that banks block cards that are linked to cryptocurrency exchanges. Who will be affected by the new rules and how to avoid possible problems when selling or buying digital assets

Last week, the Bank disclosed a scheme for using payment cards and e-wallets to accept payments to illegal online casinos, organizers of financial pyramids, forex dealers and cryptocurrency exchangers. According to the methodological recommendations of the financial regulator, banks should identify such payment instruments and block them.

The Central Bank statement says that illegal businesses may use bank cards or electronic purses, which are often registered in the name of fictitious persons. Such accounts are not used for everyday payments, utilities and other services, but there are unusual transactions in terms of frequency and amounts.

To process such payments, the shadow business uses special software, which is connected to bank Internet pages providing the service of money transfer from card to card. In this case, the necessary data for implementation are filled out automatically.

Banks are recommended not only to block operations with suspicious cards and purses, but also to terminate service agreements with clients in case of more than two blockings during a year. Accounts that fit two or more items will be considered suspicious:

An unusually large number of counterparties who are individuals, both payers and recipients of funds. More than ten per day or 50 per month;
An unusually large number of credit and debit transactions conducted with individuals. More than 30 transactions per day;
Significant volumes of transactions of debiting and crediting of funds performed between individuals. For example, more than 2000$ a day and more than 20000$ a month;
a short period of time (one minute or less) between crediting and debiting transactions;
12 hours or more than one day of transactions for crediting and debiting funds;
During the week, the average balance on the card or purse account at the end of the operational day does not exceed 10% of the average daily volume of transactions on the account during this period;
the card or the wallet does not perform operations on payment for goods or services;
The use of the same device by different individuals for remote access to the money transfer services of the credit institution.

Can a cryptocurrency user’s account be blocked?

If a cryptocurrency user actively uses his personal account to buy and sell cryptocurrencies, and the number of his transactions and counterparties exceeds the values specified in the methodological recommendations, then yes, his account can be blocked by the bank.

If the account is blocked, you need to contact the bank and convince it that the account is not used for any illegal purposes. You should be prepared to back up your words with documents.

He pointed out that in terms of current legislation and the Central Bank the use of a personal account for any activity aimed at systematic profit making (entrepreneurship) is illegal. In Russia, to engage in entrepreneurial activity, the current accounts of a sole proprietorship or a legal entity, or the account of a citizen registered as self-employed, must be used.

If a citizen is not registered in any of these capacities, but actually uses his personal account, for example, to earn money on cryptocurrency, he is, from the point of view of the Central Bank, engaged in illegal entrepreneurial activity.

How to avoid blocking?

To avoid blocking accounts, it is necessary not to exceed the limits specified in the recommendations of the Central Bank and not to perform other actions with their personal account, which the bank may consider suspicious, the expert explained. According to him, it’s better to use a current account of an individual entrepreneur or a legal entity to trade cryptocurrencies.

The law does not fully regulate the activity of buying and selling cryptocurrencies, as well as the legal status of the cryptocurrency itself.

“The way it is done in the law on digital financial assets is, alas, hard to call it regulation – from terminology (digital currency – cryptocurrency) to the selective recognition of digital currency as property for a limited list of transactions.”

The recommendations do not speak of the unconditional blocking of bank accounts, with which cryptocurrency is exchanged, the agency only encourages banks to check them in more detail for the use of obviously illegal payments, the expert reminded. He advised to refrain from using the services mentioned in the statement of the Central Bank, as well as to think about structuring the activities of cryptocurrency exchange within the legislation.

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