Bank of Russia advises banks to block suspicious cards and wallets. Targets crypto exchanges

The Bank of Russia has set out a new list of requirements for banks to use when determining suspicious transactions, including cryptocurrency transactions. The criteria produced by the central banks follows an earlier recommendation in July advising against the  listing of securities tied to crypto assets on Russian stock exchanges.

Bank of Russia has released this list of criteria to Russian banks as part of their anti-money laundering efforts, which will focus on the shadow economy that includes illegal forex dealers and financial pyramids, as well as cryptocurrency exchangers.

The bank’s criteria for a suspicious client must include at least two of the following: 

  • a large number of individual counterparties (payers or recipients) - for example, more than 10 per day, more than 50 per month;
  • a large number of transactions for crediting or debiting non-cash funds (increasing or decreasing the balance of electronic funds) carried out with individuals - for example, more than 30 transactions per day; 
  • significant volumes of transactions for writing off and (or) crediting non-cash funds between individuals - for example, more than 100,000 rubles a day, more than 1 million rubles a month;
  • a short period of time (one minute or less) between funds crediting and debiting; 
  • within 12 hours (or more) of one day, operations are carried out to credit and (or) write off funds;
  • during the week, the average balance in the bank account at the end of the transaction day does not exceed 10% of the average daily volume of transactions on the bank account in the specified period;
  • write-off operations are characterized by the absence of payments in favor of legal entities or individual entrepreneurs to ensure the life of an individual - for example, payment for utilities, other goods and works; 
  • Matching device identification information (eg, MAC address, device fingerprint) used by different individual clients to remotely access funds transfer services.

Russia's overall stance on cryptocurrency is complex. While cryptocurrencies like bitcoin were made legal in 2020 digital assets were banned from being used in payments. However, one of Russia’s biggest banks Tinkoff has said that they want to offer cryptocurrency trading to their clients, which will be unlikely while Bank of Russia maintains a firm stance on cryptocurrencies. Oliver Hughes, Tinkoff’s CEO, noted: 

“There’s no mechanism for us to offer that product to them in Russia at the moment because the central bank has got this very tough position,”

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Publication date: 
09/14/2021 - 16:48
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