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Nigeria's Union Bank Threatens to Shut Down Cryptocurrency-Related Accounts

Nigeria's Union Bank Threatens to Shut Down Cryptocurrency-Related Accounts

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A large commercial bank in Nigeria has been threatened with an undisclosed number of cryptocurrency-related accounts without explanation. Lagos-based Union Bank claims that it would be in line with the Central Bank of Nigeria's (CBN) past warnings about cryptocurrency trading.

Also read: Malaysian MP "Concerned About Threat" From Cryptocurrencies to Government Money

Panicky Customers Empty Account Balances

Union Bank of Nigeria warned: "In order to guarantee the security of our customers' funds, Union Bank will monitor accounts used for cryptocurrency transactions and may impose restrictions including the closure of such accounts." 100-year-old bank, which has $ 3.84 billion in assets, cited a series of cautionary statements from the CBN, which apparently does not completely prohibit virtual currency trading, to support its decision.

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In January 2017, the central bank issued a circular to the financial institutions pending "substantive regulation and or (a) decision by the CBN." A follow-up statement in February 2018 reiterated the same warning, but added "that virtual currencies are not legal tenders in Nigeria … we wish to caution all and sundry on the risks inherent in such activities."

However, Union Bank's sudden decision to monitor accounts has become the West African country's digital asset industry, the continent's biggest. Reports have begun to emerge from the crypto investors already withdrawing their money to avoid the possibility of their accounts being frozen.

Munachi Ogueke, co-founder of Cryset LLC – a Lagos-based over-the-counter bitcoin trading platform – told news.Bitcoin.com that several people within the Nigeria cryptocurrency space had received notifications of possible account closures from Union Bank. "Many are emptying their accounts and closing them down," Ogueke said.

Anti-Money Laundering Regulations?

<img class = "alignright wp-image-252331 size-full” title=”Nigeria's Union Bank Threatens to Shut Down Cryptocurrency-Related Accounts” src=”https://news.bitcoin.com/wp-content/uploads/2018/11/2018-11-27-19.39.14.png” alt=”Nigeria's Union Bank Threatens to Shut Down Cryptocurrency-Related Accounts "width =" 300 "height =" 300 "srcset =" https://news.bitcoin.com/wp-content/uploads/2018/11/2018-11-27 -19.39.14.png 300w, https://news.bitcoin.com/wp-content/uploads/2018/11/2018-11-27-19.39.14-150×150.png 150w "sizes =" (max-width : 300px) 100vw, 300px”/>Unemployment assault on cryptocurrency-linked accounts. CBN's warnings, as well as the other cryptocurrency transactions were illegal. But it seems to be a problem that can not be avoided.

Citing the January 2017 central bank circular, Ogueke explained:

Banks and other financial institutions that have cryptocurrency customers have the authority and can discontinue the AML / CFT systems that enable compliance with the identification, verification, and transaction monitoring requirements.

Ogueke added: "In the absence of any regulation from the CBN, it can be concluded that the CBN by this circular, has given banks (such as Union Bank), the power to close accounts of cryptocurrency customers if the customer breaches anti-money laundering control requirements and where there are suspicious transactions. "

But Union Bank has said that its customers are violating anti-money laundering laws. Rather, but he says he is doubtful, describing its justification as "flimsy."

<img class = "wp-image-252319 size-medium” title=”Nigeria's Union Bank Threatens to Shut Down Cryptocurrency-Related Accounts” src=”https://news.bitcoin.com/wp-content/uploads/2018/11/2018-11-27-19.23.37-300×262.jpg” alt=”Nigeria's Union Bank Threatens to Shut Down Cryptocurrency-Related Accounts "width =" 300 "height =" 262 "srcset =" https://news.bitcoin.com/wp-content/uploads/2018/11/2018-11-27 -19.23.37-300×262.jpg 300w, https://news.bitcoin.com/wp-content/uploads/2018/11/2018-11-27-19.23.37.jpg 530w, https: //news.bitcoin .com / wp-content / uploads / 2018/11 / 2018-11-27-19.23.37-481×420.jpg 481w "sizes =" (max-width: 300px) 100vw, 300px”/>
Munachi Ogueke

He quipped. "How is blocking accounts associated with bitcoin securing the funds of your customers?

No other bank is known to have a similar threat. When news.Bitcoin.com reached out to the Bank for comment, it repeated the statement it had sent out to its customers.

What do you think of Union Bank's decision? Let us know in the comments section below.


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