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Australia’s largest bank has announced it will block some payments to digital asset exchanges as part of new measures to protect clients from fraudsters.
On Thursday, the Commonwealth Bank of Australia (CBA) said the new ban would include a total ban on some exchanges. However, it failed to identify the exchanges to be affected.
In some cases, it will hold payments to multiple exchanges for 24 hours.
CBA will also soon introduce a monthly transfer limit of AUD 10,000 (US$6,666) to exchanges to further reduce fraud.
“Customers making payments to cryptocurrency exchanges today face a much higher risk of fraud,” commented James Roberts, the bank’s general manager of fraud management services.
“There is a disproportionate number of scams where the proceeds flow through cryptocurrency exchanges. When the money goes to those exchanges, we find it nearly impossible to recover funds from those entities,” he added.
Australia has seen its fair share of BTC scams. According to the country’s consumer watchdog, BTC scammers scammed $149 million from investors last year, accounting for 7% of the $2 billion lost to fraud in 2022.
However, according to another Big Four bank report, a third of all fraudulent payments in Australia are paid directly to digital asset exchanges.
The CBA ban comes less than a month after Westpac, Australia’s fourth largest bank, announced a similar move. However, Westpac was more specific than CBA, claiming that its ban would mostly impact high-risk offshore exchanges like Binance.
CBA’s Roberts denies that his ban has anything to do with US SEC legal action against Binance for “calculated evasion” of US securities laws. The bank stands ready to review the ban if the situation changes, Roberts added.
“These restrictions are not permanent. If the risk escalates to a point where it is at an acceptable level, it will be an inflection point for us to review this decision to ensure we strike the right balance,” he said.
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