Scott Snaith, a business owner running an electric bike retail shop had three bank accounts that got blocked earlier in the month. The accounts were two personal and one business account, and from prime banks which were HSBC and Barclays.
Snaith specifies that it was due to ‘financial discrimination’ as he used a well-known Bitcoin trading site for cryptocurrency transactions and trading purposes.
“No unlawful activity has taken place but just because the word ‘Bitcoin’ was mentioned my accounts were locked instantly. A ‘senior fraud advisor’ then closed my complaint off – leaving me with no choice but to take the issue to the Financial Ombudsman for appeal.” Mr. Snaith said.
Now Snaith is in a significant financial problem not only personally but also business wise as he cannot pay his staff or suppliers.
Snaith has even developed his own cryptocurrency product called TOBA which generated tokens every time a mile was pedaled on the electric bikes he sold. Thus Being a tech-savvy entrepreneur and a person who believes that new financial technology is essential he specified that banks were deliberately creating obstacles.
He said: “To me, this is a clear case of the high street banks abusing their power. It is not a criminal matter but a personal, corporate decision that someone has made. In my mind, that’s wholly wrong, and I am sure there are many other victims that are even less fortunate than myself.”
Andrew Hagger, a personal finance advisor, suggests, “However I think the biggest concern amongst some banks is that they may be seen to facilitate money laundering by allowing crypto transactions. It’s probably sensible to speak to your bank first before trading to see what their position is and whether they have any specific rules or transaction limits. It may also be worth keeping your crypto trading monies in a totally separate bank so if the account is frozen for any reason it doesn’t impact your day to day finances.”
A lot of people in the UK are facing issues such as Snaith. And this is mainly due to unawareness of customers with regards to cryptocurrency trading. Coinbase, for example, allows trading with Barclays as they have obtained an official bank account with them. It was the first agreement reached between a leading UK bank and cryptocurrency exchange.
The UK chief executive of Coinbase, Zeeshan Feroz, stated: “Having domestic [sterling] payments with Barclays reduces the cost, improves the customer experience…and makes the transaction faster. We believe that this is an important step towards our commitment to making cryptocurrency accessible to everyone.”
Image Source: “Flickr”