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Topic: Using a separate bank account for Bitcoin income (Read 4888 times)

newbie
Activity: 53
Merit: 0
Quote
Commonwealth Bank in Australia has closed the personal accounts of the co-founders of bitcoin wallet CoinJar after freezing the company’s business account.

Source:
http://www.coindesk.com/commonwealth-bank-closes-coinjars-business-and-founders-personal-accounts/
hero member
Activity: 882
Merit: 501
Ching-Chang;Ding-Dong
The problem is really not the bitcoins, its the high risk activity that most people dealing with bitcoins are subjecting the bank to.

And IAFCU said they will be bitcoin friendly.


Earlier powster who said that chase is bitcoin friendly is in denial.
hero member
Activity: 924
Merit: 1001
Lets just hope that the greed of the human race, from people who couldn't give a rats ass about its true "intention", don't end up watering it down into a regulated system that is barely indecipherable from other forms of currency.  I think that may be the biggest risk to Bitcoin.  Humans. 
newbie
Activity: 43
Merit: 0
I believe that if the banks decide to go to war with bitcoin they will quickly find themselves in over their heads.

"No army can stop an idea whose time has come!"
hero member
Activity: 924
Merit: 1001
Business Idea:

Start a Bitcoin friendly bank .............

If you make millions please PM me for my address as a thank you for the idea.   Grin

-Burger-
ImI
legendary
Activity: 1946
Merit: 1019
I've been seeing so many stories of people who had their bank accounts frozen or shut down because a bank wasn't prepared to take the risk regarding AML
If this happened to be your main account where you receive money, this could be a big problem. Therefor, wouldn't it be a smart idea to advice people to create a separate bank-account to receive money made through Bitcoin-channels? Either receive the transfers from your exchange account or BitPay account. In that case only you Bitcoin-income will be affected and the rest of your business can still operate.

Thats how i am handling this.
hero member
Activity: 740
Merit: 501
I've been seeing so many stories of people who had their bank accounts frozen or shut down because a bank wasn't prepared to take the risk regarding AML
If this happened to be your main account where you receive money, this could be a big problem. Therefor, wouldn't it be a smart idea to advice people to create a separate bank-account to receive money made through Bitcoin-channels? Either receive the transfers from your exchange account or BitPay account. In that case only you Bitcoin-income will be affected and the rest of your business can still operate.

The only banks that close accounts that deal with BTC are banks like Chase bank and other small american ones and for that I applaud them and encourage them, every bank has assets and liabilities, if the bank has safe and healthy liabilities then your savings in that bank are safe, the ratio is called the bank's capital ratio and it represents the banks margin of safety in the event of a crisis, unfortunately banks such as Chase will usually hold about 2% like any other western bank, on the other hand the central bank in Singapore holds 7.2% and Norway's holds 23.3%.

Move your assets from thieving tools and realize that storing large amounts in fiat is bad to begin with, it's like buying into the stock of a company when the SEO is a drug addicted pedophile that murders people systematically.
legendary
Activity: 1806
Merit: 1024
legendary
Activity: 1806
Merit: 1024
In the Netherland's everyone may have at least a basic account (with no credit limit). Because you can't exist in modern society without a bank account.

You can't receive income or pay taxes without one.

I guess this is another reason why Bitcoin is needed.

I hope this will change with Bitcoin.

Buyers and sellers of Bitcoin should meet personally if possible - no banks involved, no spying, no problems.


ya.ya.yo!
hero member
Activity: 907
Merit: 1003
I've been seeing so many stories of people who had their bank accounts frozen or shut down because a bank wasn't prepared to take the risk regarding AML
If this happened to be your main account where you receive money, this could be a big problem. Therefor, wouldn't it be a smart idea to advice people to create a separate bank-account to receive money made through Bitcoin-channels? Either receive the transfers from your exchange account or BitPay account. In that case only you Bitcoin-income will be affected and the rest of your business can still operate.
Good idea. Thank you. I hadn't thought of this. When it comes time to liquidate some of my BTC, I will do it on a new bank account with a different bank!
hero member
Activity: 490
Merit: 500
What exactly are these btc users doing that the banks are deeming it high risk?
High risk what?
If I buy/sell btc through say coinbase which is linked directly to one of my accounts, does the bank consider that high risk?

If the banks don't like what you do, or you could be a 'troublesome' customer, they just throw you out, and giving your activity the lable 'high risk' is something they just do.

It doesn't help to explain, it doesn't help to try to talk reason with them, or try to explain to them what it's all about.

Perhaps it would help if you were a good looking woman and actually slept with an exec. That's about the only way I can think of that might help. And of course, you could start hiring lawyers, and working on 'good relationships' with the important people in the bank.

For most small merchants and users, these options are not present, so the bank effectively says: Go fuck yourself.

It's a beautiful world!
hero member
Activity: 563
Merit: 500
In the Netherland's everyone may have at least a basic account (with no credit limit). Because you can't exist in modern society without a bank account.

You can't receive income or pay taxes without one.

I guess this is another reason why Bitcoin is needed.

They've been talking about this here for the last three years, but with little action so far.
hero member
Activity: 784
Merit: 501
Unfortunately, at least in the UK, if you are suspected of money laundering, the banks will freeze and then close your accounts.  You will be unable to open an account with any bank.  You will not be told what evidence there is against you and will not be able to appeal against the decision.

The issue (not relating to Bitcoin) has been in the news a bit recently.

http://www.thisismoney.co.uk/money/experts/article-2272545/Hell-NatWest-shuts-account-wont-talk.html
http://www.bbc.co.uk/programmes/b006mg74/features/banks-freezing-out-innocent-customers

In the Netherland's everyone may have at least a basic account (with no credit limit). Because you can't exist in modern society without a bank account.

You can't receive income or pay taxes without one.

I guess this is another reason why Bitcoin is needed.
sr. member
Activity: 392
Merit: 250
♫ A wave came crashing like a fist to the jaw ♫
What exactly are these btc users doing that the banks are deeming it high risk?
High risk what?
If I buy/sell btc through say coinbase which is linked directly to one of my accounts, does the bank consider that high risk?
full member
Activity: 198
Merit: 100
For all those that state their "bank manager doesn't care" or "loves them" etc...  Watch out.

I've been peripherally involved with high-risk banking for quite some time now, and this is *always* the case.  A small time manager, VP level maybe, loves your business since it means great numbers and high margin for him.  He'll try to get more of it even.

Until his higher ups tell him to shut it down.  At that point, your bank manager who you thought was your best bud who had your back won't last an instant protecting you (he might push back once since he doesn't want to lose the numbers, but that will last a couple days at most).  Doesn't matter how he explains your business, how you've been a loyal customer on the up-and-up - you're gone either way and you have zero say in the matter.

And when they shut down accounts, they generally don't do it "nicely".  They'll make you fight for any dollars left in the account, and you'll be lucky to actually get any of it back.  Get a lawyer, and expect to be without those funds for up to a year.

So yes, if you run a bitcoin related business I highly suggest getting a completely unrelated account for those transactions at a completely unrelated bank in case the worst happens.

Remember - in the US when it comes to banking, you have almost zero rights.  The bank will be able to freeze assets at a whim, and you will need substantial legal services to retrieve any of those funds in some cases.  I've seen companies ruined over a bank deciding they no longer wanted to service a merchant account due to the high-risk (politically or financially), and freezing millions of dollars of assets long enough so the company could not make vendor payments.
Truer words were never spoken. Listen to Phil21. He knows. I have been there.
hero member
Activity: 563
Merit: 500
And here's another one - resulting in someone's accounts being closed for fraud (all accounts, with all banks) due to an error by their bank!  At least this one was finally resolved, but it seems a fair amount of luck was involved in resolving it.

http://www.bbc.co.uk/news/business-18540832

hero member
Activity: 563
Merit: 500
Unfortunately, at least in the UK, if you are suspected of money laundering, the banks will freeze and then close your accounts.  You will be unable to open an account with any bank.  You will not be told what evidence there is against you and will not be able to appeal against the decision.

The issue (not relating to Bitcoin) has been in the news a bit recently.

http://www.thisismoney.co.uk/money/experts/article-2272545/Hell-NatWest-shuts-account-wont-talk.html
http://www.bbc.co.uk/programmes/b006mg74/features/banks-freezing-out-innocent-customers
hero member
Activity: 793
Merit: 1026
I just use a brain wallet.

In all seriousness though, this is a good example of the need for a USD coin.  Something that is somehow generated at about the same rate the Fed prints dollars, and everybody, or at least one large entity like Gox or somebody, agrees to always buy/sell at a dollar.  Or I guess you could just use ukash or something.  But there needs to be a digital equivalent of fiat that is protected from seizure, for exactly this type of situation.
hero member
Activity: 490
Merit: 500
What if you make two accounts:

Account A with bank 1.
Account B with bank 2.

Both are unrelated to your personal accounts with personal funds.

If you do exchange business and have funds sent to Account A with bank 1, then once the balance of that account reaches say 2K USD, transfer the remaining funds to account B with bank 2. In the event you receive a fradulent transaction, or there is a problem, there would be enough money in account A with bank 1 to cover it (reversal or whatever), and even if they froze your money, you would still have the majority of your assets in Account B with bank 2.

Would that work? I guess if there was a couple of illegitimate transfers of say 300 and 450 USD at account A bank 1, bank 1 would want to reverse those transactions, and since they didn't like such transactions, they would probably also close the account, or would they also give a message to bank 2 to freeze your funds?

If you make a business account or personal account in a bank, and this account gets frozen, if you have too many eggs in that basket, you might get a hard time as most/all of your capital is tied up!

Thoughts?
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