Bank asking to provide additional details regarding my activity

[karsyla]

Hi there,

I am trading Bitcoin on LocalBitcoins and similar websites. My bank just sent me an email asking me to provide some details regarding the transactions in my account:

- Please explain the origin of the funds received from *Name Surname* (what goods/services the funds have been paid to the account for) and provide relevant documentation (contracts, invoices)

- Explain what kind of relationships you have with *Name Surname*

- what business activity I am engaged in

- From *date* you have sent *amount* to Kraken, Payward Ltd. Please explain the purpose of such transactions.


People send me money to my bank account, I send them their coins. What kind of explanation should I provide to these questions to ensure the sustainability of my account? Especially for the first question; we do not have any contracts, and the only documentation I can get is the invoices from the exchange. Should I be completely open with them or should I try to hide that I am selling cryptocurrency? Maybe there are someone who have had similar experience?

Edited: the country I am located in, crypto is completely legal.

[1714328820]

1714328820

[1714328820]

1714328820

[AB de Royse777]

~snip~
People send me money to my bank account, I send them their coins. What kind of explanation should I provide to these questions to ensure the sustainability of my account? Especially for the first question; we do not have any contracts, and the only documentation I can get is the invoices from the exchange. Should I be completely open with them or should I try to hide that I am selling cryptocurrency? Maybe there are someone who have had similar experience?

Are you in a zone where trading crypto currency is legal? If yes then in this case you have nothing to worry.

However looking at your concern and the post I assume you are not in a territory where buying/selling crypto is legal. In that case I will suggest to contact with the buyer and come up with a mutual agreement and find something that will be believable by the bank.

May be you can ask the buyer that you will tell them you received money from a family member or such thing. You need to make a good story and the buyer will have to agree with it too.

I hope your hassle will be resolved very soon.

[semobo]

Hi there,

I am trading Bitcoin on LocalBitcoins and similar websites. My bank just sent me an email asking me to provide some details regarding the transactions in my account:

- Please explain the origin of the funds received from *Name Surname* (what goods/services the funds have been paid to the account for) and provide relevant documentation (contracts, invoices)

- Explain what kind of relationships you have with *Name Surname*

- what business activity I am engaged in

- From *date* you have sent *amount* to Kraken, Payward Ltd. Please explain the purpose of such transactions.


People send me money to my bank account, I send them their coins. What kind of explanation should I provide to these questions to ensure the sustainability of my account? Especially for the first question; we do not have any contracts, and the only documentation I can get is the invoices from the exchange. Should I be completely open with them or should I try to hide that I am selling cryptocurrency? Maybe there are someone who have had similar experience?

I hope in your country trading bitcoin is legal,if yes then you can download the invoices/references from localbitcoin for each trade you done until now and submit them to your bank.

If you are living in illegal region then you might be in serious problem now,better take legal precautionary before going into the jail  

see below image to know what zone you are in,



source: https://cryptonews.com/guides/countries-in-which-bitcoin-is-banned-or-legal.htm

[mk4]

Your response would probably hugely depend on what country you're on. While I understand that you might not want to disclose the country you're in publicly here on Bitcointalk, you might want to do research on your county's laws concerning cryptocurrencies.

Anyway, depending on what country you're in, them asking for information is not probably necessarily because you're going to get jailed or something. It's probably because it's either your bank is not crypto friendly(some are, some aren't), or they're just asking for information just so if maybe they think you're selling drugs or something, or maybe they just want to collect income tax.

You definitely gotta think of your decisions well in this.

[karsyla]

Sorry for not mentioning, the country I am in crypto is completely legal.
I am in the EU

[The Sceptical Chymist]

see below image to know what zone you are in,
<snip image>

Dude, thank you for posting that map--the information contained therein was not something I was familiar with, and I honestly didn't think there were that many countries that had outlawed bitcoin or restricted it.  Very, very interesting and I thought Russia had banned bitcoin for some reason.

OP, I got questioned by my bank once about a bunch of small bitcoin buys that I did through my checking account.  That was back when bitcoin was in the $400 range and Circle allowed you to buy small amounts.  I was asked by the bank branch manager what they were all about, so I told them I was buying bitcoin.  Nothing ever came of it since I did nothing wrong.

Banks can be pains in the ass sometimes, but they have their business to look out for and what their customers are using them for is definitely their concern.  My bank didn't know I was buying bitcoin.  It was just a weird (maybe suspicious to their eyes) bunch of small transactions that caught their attention. 

Sorry for not mentioning, the country I am in crypto is completely legal.
I am in the EU

Then I wouldn't sweat it.

[mk4]

Sorry for not mentioning, the country I am in crypto is completely legal.
I am in the EU

Then you're most likely fine. Like what I've said on my previous reply, it's most likely just them asking for proof that you're not selling some illegal stuff, or they're going to try to tax you. Either, or both. In this case, since they're already questioning you anyway, it might be the best move to just be completely honest with your answer. You probably could get more into trouble if you try to make some excuse just so you wouldn't pay income taxes.

[teosanru]

Hi there,

I am trading Bitcoin on LocalBitcoins and similar websites. My bank just sent me an email asking me to provide some details regarding the transactions in my account:

- Please explain the origin of the funds received from *Name Surname* (what goods/services the funds have been paid to the account for) and provide relevant documentation (contracts, invoices)

- Explain what kind of relationships you have with *Name Surname*

- what business activity I am engaged in

- From *date* you have sent *amount* to Kraken, Payward Ltd. Please explain the purpose of such transactions.


People send me money to my bank account, I send them their coins. What kind of explanation should I provide to these questions to ensure the sustainability of my account? Especially for the first question; we do not have any contracts, and the only documentation I can get is the invoices from the exchange. Should I be completely open with them or should I try to hide that I am selling cryptocurrency? Maybe there are someone who have had similar experience?

Edited: the country I am located in, crypto is completely legal.

Well as you said you are from a country where crypto is completely legal. But the problem so far is not concerned with crypto or bitcoin. Actually let me tell you how banks works. Generally in all the countries Central Bank & Tax authorities make a certain threshold limit on certain type of accounts and if there is a transaction exceeding that certain threshold then banks are required to report it to the authorities just to assure that transactions were legal and adequate tax compliance have been made of such transfers. For this purpose banks do such KYC on a certain transactions which they are dubious about. Now the thing is that Banks on their own have no power to sue you for anything. So you better first go to your bank and ask what is this all about. And once you are assured it's completely part of procedure then honestly answer all the questions. Don't forget to report taxes on such income otherwise you could be in trouble.

[ChrisPop]

Most probably is just them having to undergo AML procedures. If crypto is legal in your country then I see nothing wrong in your activity especially if you have invoices and all that. Unfortunately this is the birocracy we have to go through when using financial services. Sometimes it is a hassle but we need to understand that these regulations are there for a reason - to protect us and the society. Of course that there are some laws and regulations that are just there to confuse people and create loops, but we run with what we have 

[semobo]

Sorry for not mentioning, the country I am in crypto is completely legal.
I am in the EU

So you are completely fine but one thing you need to be aware of tax reports to your government related to crypto earnings and might not be serious offence if not paid the tax as well,you might be ended up paying with penalty.

see below image to know what zone you are in,
<snip image>

Dude, thank you for posting that map--the information contained therein was not something I was familiar with, and I honestly didn't think there were that many countries that had outlawed bitcoin or restricted it.  Very, very interesting and I thought Russia had banned bitcoin for some reason.

Thank you for the appreciation.

AFAIK,usage of bitcoin is legal yet in Russia but their finance ministry opposing it and might a strict guidelines to use crypto in Russia in near future.

Russian president Vladimir Putin is a bitcoin skeptic who wants cryptocurrency regulations in place “by July 1," according to the official government publication Parlamentskaya Gazeta.


The regulations are part of the Digital Assets Regulation Bill, which is expected to set guidelines for cryptocurrency use in Russia.


Separately, the Russian Ministry of Finance plans to introduce a law that will criminalize the use of cryptocurrencies as money substitutes.


Elvira Nabiullina, head of the Bank of Russia, said she and the Russian Finance Ministry oppose the use of virtual currencies "as private money and money surrogates,” saying only the ruble can be used to pay for goods and services, Bitcoin.com reported. "There is the ruble, and everything else is a surrogate," she said.

Nabiullina said the move to criminalize the use of bitcoin and other digital currencies as money substitutes is to protect the Russian ruble. "This is necessary to protect the ruble as the single legal [means of] payment in Russia," she said.

[harizen]

People send me money to my bank account, I send them their coins. What kind of explanation should I provide to these questions to ensure the sustainability of my account? Especially for the first question; we do not have any contracts, and the only documentation I can get is the invoices from the exchange. Should I be completely open with them or should I try to hide that I am selling cryptocurrency? Maybe there are someone who have had similar experience?

Edited: the country I am located in, crypto is completely legal.

Hiding or lying about your crypto activities to them might just lead to a major problem.

Your options:

1) Comply on what they asked to you since you hit the "alarm". It's a sort of verification that most banks need to follow as a mandatory term under the country's anti-money laundering act. As crypto is legal there, you don't have to worry. You just need to be true to yourself.

2) Stop involving banks on your future bitcoin transaction activity. As for me, as much as possible, even I lived in a crypto-friendly country, I will not involve banks in my crypto-related activities to avoid questions that might violate my privacy.

For your reference, I know some people who do have the same experience as you back then. Their bank accounts were closed for questioning and yes before it got back, they told the banks their crypto activity which is mostly trading at the exchanges. In your case, you are trading directly with people so plan carefully what you will say.

[carlfebz2]

Your response would probably hugely depend on what country you're on. While I understand that you might not want to disclose the country you're in publicly here on Bitcointalk, you might want to do research on your county's laws concerning cryptocurrencies.

Anyway, depending on what country you're in, them asking for information is not probably necessarily because you're going to get jailed or something. It's probably because it's either your bank is not crypto friendly(some are, some aren't), or they're just asking for information just so if maybe they think you're selling drugs or something, or maybe they just want to collect income tax.

You definitely gotta think of your decisions well in this.

This would really be a hard decision not only to op but on all people who do experience on such requirement being asked out by our banks.
You cant really removed on ones mind that they might faced up some legal issues or problems if they would tend to tell the whole thing.
This will vary on countries laws towards crypto but if we do look for it to be legal then its somewhat a relief but not totally because you wouldnt know
on what would be you banks expression if they do know that you're engaged with crypto yet we know that even a country isnt opposing with crypto
but there were always a regulation about decentralized things.

[nydiacaskey01]

This happened to me in my country and to think that in our country, there is no law yet about the legality of using Bitcoin, people are just warned. There is a bank here in the Philippines that asked the same question to their new depositors and if they found out that you are engaged in trading cryptocurrency, they will not allow you to open an account. There are banks out there that are cryptocurrency friendly, they are the one who will catch all of those that are denied by the not so friendly banks.

[maydna]

I think you should explain everything to your bank officers that all of your transaction was from trading bitcoin. Since in your country, cryptocurrency is legal, I guess you don't have to worry about everything. You don't have to cover some because your bank will know that you are lying to them and that will be too risky for you. If you don't want to answer by email, you can visit your local bank so you can meet face to face with the bank officers. And who knows, they will have an interest in bitcoin, and they will follow your step to invest in cryptocurrency. That will help cryptocurrency to grow in your city, and you might get to build a crypto community in your town.

[adroitful_one]

Hi there,

I am trading Bitcoin on LocalBitcoins and similar websites. My bank just sent me an email asking me to provide some details regarding the transactions in my account:

- Please explain the origin of the funds received from *Name Surname* (what goods/services the funds have been paid to the account for) and provide relevant documentation (contracts, invoices)

- Explain what kind of relationships you have with *Name Surname*

- what business activity I am engaged in

- From *date* you have sent *amount* to Kraken, Payward Ltd. Please explain the purpose of such transactions.


People send me money to my bank account, I send them their coins. What kind of explanation should I provide to these questions to ensure the sustainability of my account? Especially for the first question; we do not have any contracts, and the only documentation I can get is the invoices from the exchange. Should I be completely open with them or should I try to hide that I am selling cryptocurrency? Maybe there are someone who have had similar experience?

Edited: the country I am located in, crypto is completely legal.

It sounds like they are trying to investigate whoever sent you the funds. Probably someone that stole someones bank information and bought cryptocurrency from you with it. If this was all related to Kraken, they may be thinking that someone has stolen your bank account information and are trying to verify it. I wouldn't worry about it too much. Just give them the information they asked for. It's probably just a verification thing due to abnormal spending habits.

[NeuroticFish]

Sorry for not mentioning, the country I am in crypto is completely legal.
I am in the EU

Although crypto is legal, money laundering is not. And banks use to have certain imposed limits over which they start asking about the provenience of the funds.
My assumption is that you did somewhat bigger trades and passed well over those amounts, hence the questions.

Another possibilities would be that the sender tries some sort of chargeback or is himself under an AML investigation.

[Ucy]

This is interesting. The bank probably detected  suspicious  transactions in your account. If you think this is what it is about then provide them what they ask for, that is all!

You have nothing to fear If cryptocurrency is legal in your country. I think you should be completely open to them. Just make sure to record the most important things that'd transpire between you and the bank.

[LeGaulois]

Like what I've said on my previous reply, it's most likely just them asking for proof that you're not selling some illegal stuff, or they're going to try to tax you.

Since when banks collect taxes, a bank isn't a governmental institution!

@OP
You worry for nothing and @teosanru gave a hint. Since you mentioned you're from the EU, banks use algorithms to detect suspicious activities. In Europe, the threshold is about 5000€ during the last 30 days. Once your account is flagged the bank is supposed to do the first check and then supposed to report your bank account to the financial authorities, then it is up to them to make the necessary investigations. Some don't bother to do the first verification (since it's automated), in your case, your banker did it.

You don't have to lie, it never pays btw. On the opposite, if you are able to explain clearly what you are doing (and if you can also provide evidence) you have nothing to worry about. There are thousands of accounts reported in the EU but in the end, just a very very low percentage of the accounts are truly doing something shady. (99% are false reports).

Another point.
It is possible that your bank thinks you have commercial activity and as personal accounts are not allowed for that (banks hate it). They would like to be sure (in case they can sell a pro account). You can tell them it isn't a regular activity just an extra income, they will be fine.
If you use this account just to do your LBC stuff, it's easy for the bank to think you're running a business (No bills paid, no recurring payment, no card transactions etc)

[SvonioneFromMangoCoinz]

If your country legalizes crypto, don't be afraid to tell the truth. they won't accuse you, they just want to know what you do with that money and whether you make money or you launder money. Therefore, please give the most true testimony. Your worst case is just about tax, don't worry.

[AicecreaME]

I didn't get it, I'm sorry

It is so contradicting, you just said

Are you in a zone where trading crypto currency is legal? If yes then in this case you have nothing to worry.

and then this

However looking at your concern and the post I assume you are not in a territory where buying/selling crypto is legal.

I assume you meant was OP is in a zone where trading cryptocurrency is legal but, he needs to provide the whole information regarding every transactions he have in his bank account history. I guess when he did that, the banks would stop sending him emails questioning how he earns money.

E D I T: correct me If I'm wrong