Banks Freeze Company’s Accounts After Owner Traded on Localbitcoins

The owner of cryptocurrency mining electric bicycle retailer, 50cycles, recently had his company’s accounts with HSBC and Barclays frozen within hours of transacting on peer-to-peer cryptocurrency trading platform, Locabitcoins.

HSBC and Barclays Freeze Accounts of 50cycles

Mr. Snaith’s accounts were frozen by HSBC and Barclays just hours after he conducted five-figure BTC transactions via peer-to-peer trading platform Localbitcoins, in which he sold BTC for fiat currency that was deposited into his personal bank accounts, and not his company’s accounts. Mr. Snaith asserts that the transactions were “entirely transparent and above board,” adding that his trading partners were U.K. account holders with verified identification. Mr. Snaith stated that no explanation was offered for the account closures, describing himself as being the victim of “financial discrimination.”

“My two personal bank accounts and business account were frozen for using a well-known bitcoin trading site. 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. This situation is a complete nightmare and the knock-on effects have been unbelievable. One of my staff left as they had just had a baby and couldn’t afford to be in a job that was unable to pay them, which isn’t surprising,” Mr. Snaith said.

HSBC Reinstates Account, Barclays Refuses

“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,” he added.