Australia’s Commonwealth Bank Limits Crypto Transactions Amid Fraud Concerns

[ad_1]

Get all the essential market news and expert opinion in one place with our daily newsletter. Get a full recap of the day’s top stories straight to your inbox. Register here!

(Kitco News) – The Commonwealth Bank of Australia (CBA), the country’s largest bank, has announced the introduction of new measures designed to protect customers from the risks associated with cryptocurrencies, including suspending for 24 hours certain payments to crypto exchanges. .

“As of today, the CBA will deny or hold for 24 hours certain payments to cryptocurrency exchanges,” the bank said in the press release. “In the coming months, the Bank will also introduce limits of $10,000 in a calendar month where the Bank can identify customer payments for cryptocurrency purchase exchanges.”

The CBA’s move comes as the world’s two largest cryptocurrency exchanges – Binance and Coinbase – face legal action from the US Securities and Exchange Commission (SEC), while major Australian bank Westpac has banned customers from transacting with Binance.

“Consumer interest in cryptocurrencies has increased and unfortunately scammers around the world are capitalizing on this trend and posing as legitimate investment opportunities or diverting funds to cryptocurrency exchanges,” said James Roberts, Commonwealth Bank’s managing director, Group Fraud Management Services. “With the incidence of scams increasing and in many cases customers suffering significant losses as a result of the scam, the introduction of 24-hour holds, declines and limits on outgoing payments to cryptocurrency exchanges will help reduce both the number of scams and the amount of money lost by customers.”

The bank will closely monitor the impacts of the new scam response measures in the future and will organize regular reviews to reassess whether the measures need to be adjusted.

“Customers making payments on cryptocurrency exchanges currently face a much higher risk of potentially being scammed,” Roberts said. “While these measures do not eliminate the risk of customers suffering losses as a result of a scam involving payment to a cryptocurrency exchange, they are part of a range of initiatives designed to help customers reduce their risk of being scammed. ”

The new measures follow the announcement that the ABC will offer its NameCheck anti-fraud technology to external organizations that process payments in Australia as part of a broad national approach to help tackle scams and fraud in Australia. the community.

NameCheck uses state-of-the-art technology and available payment data to determine if the account details entered by a customer appear to be correct, helping to ensure that money is being transferred to the correct account.

“Across Australia, a whole ecosystem approach is needed to tackle scams and the CBA is committed to helping keep customers safe, as part of a broader national approach of government, businesses regulators, banks and other industry sectors,” Roberts said. “We are committed to being part of a larger solution with government, regulators, banks, telecom operators and other industry sectors to keep Australians safe.”

Today’s announcement represents a sharp about-face for Commonwealth Bank, which announced in November 2021 that it would become the country’s first major bank to offer a platform for retail customers to trade cryptocurrencies.

The bank has partnered with New York-based exchange Gemini Trust Company LLC to offer crypto exchange and custody services through its CommBank app. The service’s pilot was eventually scrapped in May 2022 after Australian financial regulators deemed it too risky for the average investor.

Gemini has since run into its own host of problems — including accusations from the U.S. Securities and Exchange Commission that they violated securities laws — which likely contributed to the ABC’s decision to limit crypto transactions until financial and regulatory challenges in the industry disappear.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure the accuracy of the information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. This is not a solicitation to trade commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article accept no responsibility for loss and/or damage resulting from the use of this publication.

[ad_2]