Bank account opening rejected - seeking advice.

[Herodes]

Obviously I am not a lawyer, so I have nothing but common sense to work on.

The facts:

1. Legitimate business (Company) run by legitimate individuals. Both business and individuals have clean sheets in regards to any run in with the law.
2. Being honest and upfront about dealing with bitcoins as an integrated part of the business model.
3. Willing to work with the bank, and to explain in detail any part of the business, or being willing to provide any auditing necessary, and to comply with the demands they'd put forth.

The action:

Company applied for a bank account with an European bank. Application rejected, and company was told that the rejection could not be discussed in detail.

End result:

Bank is unwilling to discuss the matter, but it has surfaced that there are fears of 'money laundering' that's the reason for the rejection. Company has told the bank that
it is willing to provide full disclosure in regards to the flow of funds, and that any bitcoins purchased are obtained through legitimate bitcoin exchanges after wiring money
to said exchanges through the ordinary banking system.

Seeing at the same time how the same bank willingly cooperates with a lot of the banks that has recently been in the press for very serious cases of money laundering and
other ways of mischief, it's odd that they see a small Company as a threat, and reject to do business with it.


Is this at all legal ? As long as the bank can't prove that the Company has done anything wrong, and apparently has no reason to be of this opinion, as long as the Company is willing
to cooperate, can the bank just reject a customer like this ? The most annoying part is that the bank will not discuss the matter with the Company.

In old america, some stores used to have signs saying: "No blacks allowed". It seems some banks have signs these days saying: "No bitcoiners allowed".

What can a small Company do about something like this. Obviously launching expensive lawyers at the bank is not an option.

What bugs me, is the fact that they won't even listen to what the Company has to say, they just made their decision, and that's that. Yet they happily accept the business of other
banks that defraud for millions of euros..

The end question will be, what can be done about the issue, and is there any point in trying to hammer any 'sense' into them ?

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[DeathAndTaxes]

In the US race is a protected class, "Bitcoiner" is not.

The banks actions are likely legal.  They don't guarantee they will open an account for all people at all times.  It would be like asking if getting denied for a loan is legal.  
It sucks but aside from paying a lot for lawyer for a case you are almost certain to lose your only option is to try another bank.

BTW: the law has nothing to do with common sense.  Nothing.  Common sense says what the bank did was stupid and arrogant.  That doesn't make it against the law though.  If being stupid and arrogant was against the law banks would have been deemed illegal a long time ago.

[davout]

Which bank was it ?

Are you located in the same country as the bank you want to open an account with ?

Is this at all legal ?

Yes. They have no obligation to start a business relationship with you, neither do they have an obligation to motivate or discuss this fact.
Worse, they are legally required to not discuss any suspicion of ML when they make a suspicions reports to their overseeing body.

In old america, some stores used to have signs saying: "No blacks allowed". It seems some banks have signs these days saying: "No bitcoiners allowed".

Yup.

What can a small Company do about something like this.

Find another bank, present the business under a different light that doesn't put all the focus on Bitcoin perhaps.

Obviously launching expensive lawyers at the bank is not an option.

To achieve what exactly ?

What bugs me, is the fact that they won't even listen to what the Company has to say, they just made their decision, and that's that.

Why would they lose their time if they have already made a decision. They have a business to run after all.

The end question will be, what can be done about the issue,

Work harder, go knock on more doors.

and is there any point in trying to hammer any 'sense' into them ?

None. Because your definition of "sense" is not the same as theirs

[mintymark]

I have found (here in Uk) that banks vary enormously even within the same bank from branch to branch on the answer to a simple question like please may I open an account or have a loan.

In general my advice would be do not waste your time with the bank that has said no, but pick another branch preferably in a well-to-do area. Where I live, the bank is down at heel, under staffed and has many not so well of customers queueing all the time. In such an area, the bank is probably just kept so they can say they have a branch, probably on average the less actual business they do the better!!

Go to a well-off area and to do well the bank wants to do as much business as fast as possible. You'll probably be seen even without making an appointment and they will be keen to give you an account.

Do not mention bitcoins: the bank will not understand. You can talk about internet tokens of value and differential rates. Of course you will comply with any money laundering regulations, but you do not want to be discussing that before you even start!!

 

[Herodes]

Thanks for your advice. Yes, what you say all makes sense.

Thank you.

[Isokivi]

I'd like to know the name of the bank, these is a small chanse I have an account in it. Should this be the case I will definetley swap over to another bank.
[edit] ..and obviously tell them why I am leaving.

[Herodes]

Although it would feel good to name and shame, I'm not sure if there's any point to that here. Those interested in knowing which bank it is, please send me a pm, and I'll let you know. I have already received a lot of good advice, also on pm, so thank you to everyone that contributed.

[Darkneo]

You're best option is to try a smaller branch or bank. I know I could easily get approved by a smaller bank rather than a larger national bank.

And definitely say virtual currency, token or virtual coins. Bitcoin has gained a bad rep from those using it to buy illegal items and money laundering.

[repentance]

Generally speaking, unless you live in a country where your right to a bank account is legally guaranteed, your only option is to try another bank.  All banks are going to make a risk assessment of your business (they're required to do so both initially and on a continuing basis) but some may have a higher risk tolerance than others.  Banks don't really want customers who require a lot of maintenance (including enhanced due diligence) unless they're extremely profitable customers for the bank.  For the most part, general banks want high-value, low-maintenance customers rather than "every customer they can get".  Remember that to their idea of a "big" customer and yours are likely very different.

Don't lie to them about the nature of your business - it's not worth the possible repercussions and you'll probably end up under all sorts of AML-type scrutiny which you don't need.

It might be worth paying a financial advisor to recommend boutique banks which are less risk averse if you find yourself getting rejected by "name" banks.

[21after2]

A lot of financial institutions are unlikely to trust a relatively unknown currency like BitCoin. Also, you mentioned you were in Europe? I'll bet most banks are on an even higher alert now due to the recent concerns with UBS and Wegelin & Co.

[malevolent]

A lot of financial institutions are unlikely to trust a relatively unknown currency like BitCoin. Also, you mentioned you were in Europe? I'll bet most banks are on an even higher alert now due to the recent concerns with UBS and Wegelin & Co.

Mentioning Bitcoin as a currency is a bad idea - for the sake of safety & simplicity just say it is a mean of payment like Paypal or Western Union.

[MysteryMiner]

Just ask some homeless person or drug addict to open bank account for you and dont tell the bank for what you are going to use the acc. Works every single time.

[malevolent]

Just ask some homeless person or drug addict to open bank account for you and dont tell the bank for what you are going to use the acc. Works every single time.

Might be ok for personal use from time to time if one wants to remain anonymous but I wouldn't risk it for a legitimate business.

[MysteryMiner]

I wouldn't risk it for a legitimate business.

For how long You expect Bitcoin to remain legal or only a niche geek thing that no one uses? The legal system are well known to goatse people running businesses that were legal, than change something in laws and make a show trial of the business owners. eGold, scat porn (lol!), some guy printing silver coins whatever he was called, operators of hosting services, security researchers, the list is endless.

[Darkneo]

Until my business takes off, I'm just going to do any current financial transactions through my personal account.

[Jouke]

Obviously I am not a lawyer, so I have nothing but common sense to work on.

The facts:

1. Legitimate business (Company) run by legitimate individuals. Both business and individuals have clean sheets in regards to any run in with the law.
2. Being honest and upfront about dealing with bitcoins as an integrated part of the business model.
3. Willing to work with the bank, and to explain in detail any part of the business, or being willing to provide any auditing necessary, and to comply with the demands they'd put forth.

The action:

Company applied for a bank account with an European bank. Application rejected, and company was told that the rejection could not be discussed in detail.

End result:

Bank is unwilling to discuss the matter, but it has surfaced that there are fears of 'money laundering' that's the reason for the rejection. Company has told the bank that
it is willing to provide full disclosure in regards to the flow of funds, and that any bitcoins purchased are obtained through legitimate bitcoin exchanges after wiring money
to said exchanges through the ordinary banking system.

Seeing at the same time how the same bank willingly cooperates with a lot of the banks that has recently been in the press for very serious cases of money laundering and
other ways of mischief, it's odd that they see a small Company as a threat, and reject to do business with it.


Is this at all legal ? As long as the bank can't prove that the Company has done anything wrong, and apparently has no reason to be of this opinion, as long as the Company is willing
to cooperate, can the bank just reject a customer like this ? The most annoying part is that the bank will not discuss the matter with the Company.

In old america, some stores used to have signs saying: "No blacks allowed". It seems some banks have signs these days saying: "No bitcoiners allowed".

What can a small Company do about something like this. Obviously launching expensive lawyers at the bank is not an option.

What bugs me, is the fact that they won't even listen to what the Company has to say, they just made their decision, and that's that. Yet they happily accept the business of other
banks that defraud for millions of euros..

The end question will be, what can be done about the issue, and is there any point in trying to hammer any 'sense' into them ?

Yeah, we had the same problems with three different banks. Because bitcoin and tor and drugs and anonymous.

[Spekulatius]

MtGox had the same troubles with that French bank back in 2011. They sued and Idk how that evolved. YOu could learn more if you did some research in that direction.

Cheers and good luck

[Peter Lambert]

MtGox had the same troubles with that French bank back in 2011. They sued and Idk how that evolved. YOu could learn more if you did some research in that direction.

Cheers and good luck

The thing with MtGox was a totally different story, they actually had an account opened and had bunches of money in it, and they had to sue to get all their money back when the account was closed on suspicion of money laundering.

[davout]

Idk how that evolved.

They got bitchslapped by the judge for running an unlicensed financial business.

[Deafboy]

They got bitchslapped by the judge for running an unlicensed financial business.

Yes, but companies in France are required by law to have a bank account, so the judge also said that bank has to re-open the account.
Unlicensed fin. business is different story.

Also, try banks in Poland. They are usually more bitcoin-friendly.