Proposition: UK banks blocking transfers to Bitcoin exchanges is illegal and in

[matt608]

Discussion on reddit:
http://www.reddit.com/r/Bitcoin/comments/1cy8fc/proposition_uk_banks_blocking_transfers_to/

Summary:  The banks are defending an illegal monopoly and restricting free trade by shutting down the bank accounts of bitcoin exchanges.

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[franky1]

Discussion on reddit:
http://www.reddit.com/r/Bitcoin/comments/1cy8fc/proposition_uk_banks_blocking_transfers_to/

Summary:  The banks are defending an illegal monopoly and restricting free trade by shutting down the bank accounts of bitcoin exchanges.

UK banks dont mind money transfers to other UK banks. what they do mind though is money going out of the country to european/US banks/exchanges.

so your funds will be frozen alot and i mean alot less if you do bitbargain, bitcoinfridge, speedybitcoin, local bitcoin transactions

[cupronickel]

UK banks dont mind money transfers to other UK banks. what they do mind though is money going out of the country to european/US banks/exchanges.

No, that's not the issue. There are no exchange controls on sterling.

[franky1]

UK banks dont mind money transfers to other UK banks. what they do mind though is money going out of the country to european/US banks/exchanges.

No, that's not the issue. There are no exchange controls on sterling.

well having spoken to FSA and also to my bank they dont mind bitcoin. but as soon as i mentioned that half my funds may go to out of country banks, they started to sound less then pleased.

banks in the UK know your whole life story when you set up a bank account so the AML/KYC (which us brits call AML/CDD) is a small/negligable problem for SOCA to investigate money movements. but as soon as money moves out of country its alot harder to trace who is behind foreign bank accounts and if they are known terrorists as its not in their juristiction,

FSA HMRC etc only care about fiat.

so as long as they see dave in london pay steve in manchester £1000, its all tracable.. what dave and steve buy and sell each other using the FIAT is not important. all FSA/HMRC care about is the FIAT money trail

so the main problem banks have is money moving abroad, which becomes less tracable without alot of paperwork and communications with other governments........ not the purchase of bitcoins.

if in doubt speak to HMRC, FSA and your bank yourself.

[WiseOldOwl]

Haha,

Welcome to the world of bitcoin.
In 2011 When i was running a decent sized exchange, I had all my accounts shut without reason. I recieved a phone call from the vice president of a fairly massive bank and was told that they dont approve of my business type.
When I asked if I could have a report outlining what I did wrong or why my accounts were closed, he literally scoffed and said no. These were business accounts registered to a LLC (a financially registered llc none the less). They dont give a shit and will protect their monopoly at all costs. You have no idea what your in for. You are scratching the surface of the largest iceberg around. Bankers have literally forced countries into war and poverty, they are strategists with insane amounts of resources and connections, and they will find a way to obliterate most any conventional method you use to grow a business that conflicts with theirs.

[nwbitcoin]

The current excuse is money laundering, but if that doesn't work, they have other excuses.
Nobody is going to give you a straight answer, Bitcoin is a flea in the grand scheme of things, but that doesn't mean you don't wack it now, before it becomes a problem!

If you are going to deal with UK banks, be sensible, and don't show up on their radar!

[franky1]

Haha,

Welcome to the world of bitcoin.
In 2011 When i was running a decent sized exchange, I had all my accounts shut without reason. I recieved a phone call from the vice president of a fairly massive bank and was told that they dont approve of my business type.
When I asked if I could have a report outlining what I did wrong or why my accounts were closed, he literally scoffed and said no. These were business accounts registered to a LLC (a financially registered llc none the less). They dont give a shit and will protect their monopoly at all costs. You have no idea what your in for. You are scratching the surface of the largest iceberg around. Bankers have literally forced countries into war and poverty, they are strategists with insane amounts of resources and connections, and they will find a way to obliterate most any conventional method you use to grow a business that conflicts with theirs.

actually by law if you read the HMRC guidelines on the wire transfer regulations. money transmitters who end up in a situation where they have slight doubts about the transaction freeze the funds to first internally investigate the matter, before deciding what to do next. the regulations state that you cannot inform the customer that they are being investigated for specific reasons.

might be worth you reading some of the regulations so that you know what to do and how to handle situations that arrise, to atleast prevent them arrising.

tip 1

dont do deals over roughly £850 in one go (1000euro -EU wire transfer regulations)
dont do deals over roughly £12750 combined within a year (15000euro -EU wire transfer regulations)

tip 2
if using a business bank account to deal with large volume(under £3mill a month -payment services regulations). get FSA authorised.
if using a business bank account to deal with large volume(over £3mill a month -payment services regulations). get FSA accredited

tip 3
keep the funds cycling between business and customers based in the UK. as soon as funds go to foreign countries flags start to fly.. literally

tip 4
if your a single guy under the age of 25, without a sheep heard of customer service employee's, accountants and a corporation logo (think intersango/bitcoinica/blockchain.info) the banks will wonder where soo much money is passing in and out of your account. so develop a business relationship with your bank manager

[nobbynobbynoob]

well having spoken to FSA and also to my bank they dont mind bitcoin. but as soon as i mentioned that half my funds may go to out of country banks, they started to sound less then pleased.

banks in the UK know your whole life story when you set up a bank account so the AML/KYC (which us brits call AML/CDD) is a small/negligable problem for SOCA to investigate money movements. but as soon as money moves out of country its alot harder to trace who is behind foreign bank accounts and if they are known terrorists as its not in their juristiction,

A key point to remember, though, is that the UK is (still!) within the EU (or the EUSSR as some of us like to call it sometimes) and it's supposed to be a single market for all goods/services/capital/etc., thus accounts in EU banks aren't "foreign" at all, any more than those in the different nations of the UK. And there's SEPA and all that lark. There's supposed to be free movement of capital within the EU! That's the theory anyway - as we've recently witnessed in the case of Cyprus, laws fly out of the window almost any time it becomes inconvenient for TPTB.

FSA HMRC etc only care about fiat.

Yes, this part is important to remember. Much the same with the FinCEN report and AML/KYC generally, it concerns the fiat side of the equation. It would be almost impossible to enforce for bitcoin-only transactions.

so the main problem banks have is money moving abroad,

But that's (legally) supposed to mean "outside the EU", for those within the EU! Capital controls within the EU are illegal - except in the case of Cyprus, it seems...

[franky1]

nope.. its not illegal to freeze funds without reason..

please read the EU wire transfer regulations. it clearly states a transaction looks to be odd or exceeding the regulated limts they can freeze the funds and more importantly they should NOT disclose why..

so whether its because your on a terrorist black list or you simply sent more then 1000euro equivalent (£850) to a euro account in one shot, they will not give you a straight answer.

but the main thing i have found is UK banks only truly love and trust UK banks.
Although connected via regulation, the communications and data availability is less fluid from euro< ->UK so theres a slight higher issue moving money to euro banks. but the worse culprit is non euro banks.

i stick to my 3 tips and "touch wood" never had a problem and my bank manager in my local branch loves it

[nobbynobbynoob]

nope.. its not illegal to freeze funds without reason..

Unfortunately, you're right, of course. This is something anyone with funds in the banking system needs to remember. Don't invest more than you can afford to lose.

En effêt, we have been lied to all along about free movement of capital within the EUSSR, but that'd be nothing new.

[QuantPlus]

They dont give a shit and will protect their monopoly at all costs. You have no idea what your in for. You are scratching the surface of the largest iceberg around. Bankers have literally forced countries into war and poverty...

You are shooting the messenger.

All Government Power flows from currency and the power to tax...
The Banking System are just flunkies that organize all the details.

BTC is actually a direct challenge to all Government Power...
And Govts are just beginning to notice and respond...
And there is no limit to this response...
Regulations, fines, jail, carpet-bombing... what ever it takes.

[julius]

I recommend use transferwise to avoid any kind of problems like the one explained in the OP.

[nobbynobbynoob]

I recommend use transferwise to avoid any kind of problems like the one explained in the OP.

Trouble is, it seems now that Transferwise -> Bitcoin has now been firmly blocked by the banksters.

[btbrae]

Trouble is, it seems now that Transferwise -> Bitcoin has now been firmly blocked by the banksters.

This is getting ridiculous... although I wouldn't be surprised if Transferwise gets forced to end this type of transfer altogether like Oanda's FXGlobalTransfer service did following US regulations.

[virtualmaster]

We should make a petition against UK bank abuse.

[kiko]

Don't worry. In a short while the UK will laugh at all these people in other countries that have to wait ages sending money to exchanges. We'll have the most advanced network of street dealers anywhere in the world. Most will simply buy from a friend. It'll be just like the old bringing cartons of cigarettes back from holiday. No big deal. Every other off-licence will sell bitcoins under the counter.

[franky1]

We should make a petition against UK bank abuse.

its not actually bank abuse, its actually exchanger ignorance and lazyness. if you don't develop a business relationship with your bank manger to start with and inform them of exactly what your business officially is.

EG blockchain.info told their bank they are selling advertising credit/revenue stuff..

which later comes to light that your story doesn't bare fruit. flags start to fly.

Also being ignorant to the regulations by thinking that the FSA are reactive (which they are) and not proactive, some how protects you from worrying about regulations until a problem arises, is another reason why flags will fly when people start trying to charge back and banks start digging deeper.

the secret, if you dont want to run a business and keep things private. stick to the value limits in one of my last posts. and stick to localbitcoins/bitbargain/otc.

if you want to be a bitcoin business, read the regulations thoroughly and respect both your bank manager and the regulations and follow the guidelines offered. be honest and upfront about all issues before they bite you later.

[julius]

I recommend use transferwise to avoid any kind of problems like the one explained in the OP.

Trouble is, it seems now that Transferwise -> Bitcoin has now been firmly blocked by the banksters.

Fuck me! I had not heard those news. Thanks for posting.

That is really bad news.

[libertine]

ok so if I buy btc using a uk bank transfer would this be ok? but pretty hard to do from an exchange?

[julius]

ok so if I buy btc using a uk bank transfer would this be ok? but pretty hard to do from an exchange?

It would appear that the best option we have at the moment is buy from localbitcoins.com.

[nwbitcoin]

I find localbitcoins has worked well for me.

This is my advert:
https://localbitcoins.com/ad/12522/purchase-bitcoin-bank-transfer-united-kingdom-united-kingdom

The biggest problem for me is trying to get the cash back into the system, and its mostly about being aware of how long money movement between banks actually takes.

However, things will change, and we will get to an easier solution, its just hard work now.

[cupronickel]

well having spoken to FSA and also to my bank they dont mind bitcoin. but as soon as i mentioned that half my funds may go to out of country banks, they started to sound less then pleased.

Thank you for your insight franky, you've clearly gone through some of the hoops already. So if the UK infrastructure is putting up barriers because they are hyper sensitive, why not just tx to a bank on the Euro mainland where there's a more progressive climate and go from there? I suppose you'd have to have a reason for that account but if you're in a business, it shouldn't be too difficult to set up a branch office structure.