Why banks are suddenly closing down customer accounts • Hacker News Board

Re: Why banks are suddenly closing down customer accounts

#841

Post by anonzzzies » Tue, Nov 07, 2023, 12:25 PM UTC

klauserc wrote: post #537

fyzix wrote: post #48

Earlier quoted context omitted.

I'm usually a crypto sceptic but your story scares me, because it'll only get worse with time.

Why reach for crypto? My strategy would be to have a small emergency fund with a different bank. The risk of being debanked by two independent banks _at the same time_ seems lower than crypto.

I use 5 different banks and have cash. The problem is that with the lame (primarily US driven) overreaching AML nonsense, banks will not take any risks and close whatever they don't make a lot of money on at the first sign of issues. Why would they not. What do you do if multiple/all banks closed your accounts for no reason at all outside that you are too small a fish to put an actual human on to verify the validity of the closure? Is there anything outside crypto and stuffing money and gold in your mattress?

Re: Why banks are suddenly closing down customer accounts

#842

Post by pipes » Tue, Nov 07, 2023, 1:04 PM UTC

raincom wrote: post #199

pipes wrote: post #22

Earlier quoted context omitted.

And the regulator pretty much said it is all fine, nothing to see here!

The regulator didn't go through Nigel's case at all, as 'it is understood that the data does not cover his case, given that the bank never followed through with the closure' [1]. What FCA found that banks never debanked people based primarily on political beliefs[1]. However, Banks can use political beliefs secondarily to debank, and that's what Natwest did. Nagel sought documents from Natwest using Subject Access Re…

Interesting, then what was their primary reason for debanking him?

Re: Why banks are suddenly closing down customer accounts

#843

Post by pa7x1 » Tue, Nov 07, 2023, 1:34 PM UTC

Quindecillion wrote: post #835

pa7x1 wrote: post #831

Earlier quoted context omitted.

Without a general purpose (i.e. Turing complete) and sufficiently expressive programming language (i.e. providing an idiomatic and expressive manner to build general-purpose logic) associated to the ledger you cannot build scaling technology that inherits the self-custodial, permissionless, and censorship resistance qualities of the underlying ledger. Nor a financial system that inherits those same properties. If you…

> you cannot build scaling technology that inherits the self-custodial, permissionless, and censorship resistance qualities of the underlying ledger Correct, and yet you seem to still miss the point. There are tradeoffs. You can't scale AND maintain those properties. This is why Bitcoin scales with layer 2 solutions like Lightning (and more ideas like Enigma, Ark, Cashu etc.), or things like RGB or Taro for expressiv…

> You can't scale AND maintain those properties.

zk-proofs allow you to do so. It's seeing very active development, and yes it involves an L2. The issue you seemed to have ignored is that to be able for the L2s to inherit those properties from the L1, the L1 needs to have sufficient expressiveness to be able to build the proof verifiers. I would love to see how anyone builds such a thing on bitcoin.

Re: Why banks are suddenly closing down customer accounts

#844

Post by norswap » Tue, Nov 07, 2023, 1:56 PM UTC

Haters gonna hate, but crypto solves this.

Recent events show even in our liberal democracies, governments can't be trusted with the power they already have, and the enormous power that technology does and will afford them.

(The most salient example is the Trudeau government freezing the bank accounts of trucker donators.)

Re: Why banks are suddenly closing down customer accounts

#845

Post by joshjje » Tue, Nov 07, 2023, 2:12 PM UTC

mcny wrote: post #544

trompetenaccoun wrote: post #523

Earlier quoted context omitted.

Horrible. I've heard similar stories but this one's the worst by far. This shouldn't be allowed to ever happen again, such sudden closures without warning need to be illegal. The issue is banking is highly regulated but a lot of the regulation is about AML, terrorism screening and such. Not actually protecting customers from abuse but rather the other way around - banks are taking precautions to protect themselves fr…

> There is a solution - not sure if everyone's ready to hear it yet: Decentralized finance. I want the pendulum to swing the other way. Everybody gets and gets to keep forever an account at the Reserve Bank. > self-hosted Ethereum wallet I'm sorry. The technology might be fine But I simply do not trust the people involved with cryptocurrency. Not just the scammers such as SBF, I don't trust the "victims" to make wise…

I agree. It would be so much easier if everyone had a government bank account just like a SSN, that they could use (or not use), and also have other private checking/savings/etc accounts like now if they wish. It would also help teach people how to use them.

Re: Why banks are suddenly closing down customer accounts

#846

Post by avs733 » Tue, Nov 07, 2023, 3:09 PM UTC

freddie_mercury wrote: post #798

avs733 wrote: post #367

Earlier quoted context omitted.

I know what you are saying but I want to counter the interpretation a bit. What the spokespeople say is a claim…it’s not truth, we don’t have independent evidence of it, of course they would claim that. Even if they did have human in the loop - what does that meaningfully look like? Are those humans given the authority to actually overrule the decision? Are they given the evidence to do so? Are they punished or perce…

> I don’t think taking the banks answer to any of those questions at face value is responsible citizenship I agree but I wanted to push back on the idea that this was somehow due to automated decisions being made. That isn't really the problem here. The same exact thing would happen if the government mandated "no computers are allowed to be involved". The problem is opaque decision making, no clear escalation path, a…

I can agree with this. I do think automated decision making amplifies the effect, but you are right on the fundamental issue

Re: Why banks are suddenly closing down customer accounts

#847

Post by uconnectlol » Tue, Nov 07, 2023, 3:12 PM UTC

klauserc wrote: post #537

fyzix wrote: post #48

Earlier quoted context omitted.

I'm usually a crypto sceptic but your story scares me, because it'll only get worse with time.

Why reach for crypto? My strategy would be to have a small emergency fund with a different bank. The risk of being debanked by two independent banks _at the same time_ seems lower than crypto.

...until they implement a system to automatically corroborate your accounts and close them all at once, which will happen, "because crime". security theater only gets worse over time. but right now you "hackers" can stop this since 99% of transactions can still be done in cash. but you won't because you're all fake.

Re: Why banks are suddenly closing down customer accounts

#848

Post by uconnectlol » Tue, Nov 07, 2023, 3:18 PM UTC

why would a bank just close your account because of a false positive

i read through most of the article and could not find discussion of such an obvious question

do you get to re-open your account after they realize they're wrong? does this actually affect credit scores? big if true. i realize this is probably just a bug due to security theater with unwillingness to fix the bug being part of the security theater.

we already knew the bank polices every single transaction we make (which is absolutely intolerable and should be illegal, along with most of the credit system which is also just surveillance), but closing accounts in any meaningful way would be new.

and this is another dipshit article that doesn't actually even name the problem. instead they point to unprovable discrimination as usual. NO. the problem is that what someone does with their money is a private matter, like none of your fucking business. there wouldn't be any discrimination if the bank just was a real product and not a one sided """relationship""" which is just code for "we shove our noses into every transaction you make for your own good, loser".

what i imagine is that in actuality what actually happens is you have to do a bunch of annoying phone calls and "security" crap like going on a website and doing captchas, receiving 6 digit codes through SMS, whatever new security theater fad is current like spinning around in front of a camera, etc then you get your account re enabled.

Re: Why banks are suddenly closing down customer accounts

#849

Post by winternett » Tue, Nov 07, 2023, 3:42 PM UTC

jurynulifcation wrote: post #816

kylebenzle wrote: post #642

Earlier quoted context omitted.

I agree, to the point that it's getting harder for me to even have any sympathy when I hear about this issue. Anyone without a good portion of their net worth in crypto is making a huge and obvious mistake.

So you're admitting to having a self-interested stake in getting others to convert a portion of their net worth to crypto, no? Since getting others to buy in would directly provide liquidity to your own position. Tell me, what customer or financial protections are in place for your crypto position. Are there any? At all? Or if the drive holding that "good portion" disappears, then so do your assets, yes? Having a ban…

Crypto bros are the guy who used to stand in the alley with a trench coat full of watches... Hah.

We're doomed if this type of crowd sourcing of scams sets in without people noticing and calling it out.

I bought $100 of BTC about 1 year ago when it was at $24,000, just the other day it was at $34,000 and my account said my crypto was at $102. That's all I needed to know about it.

Re: Why banks are suddenly closing down customer accounts

#850

Post by Pet_Ant » Tue, Nov 07, 2023, 3:46 PM UTC

phil21 wrote: post #660

ArabicBaklava wrote: post #494

Earlier quoted context omitted.

Well, this happened in 2017.. fast forward to this account closure effect on my life: I had to go back to my country, without a degree, was not able to land any job. Unfortunately, good places require degrees. Stayed unemployed, hit with chronic depression as anyone would. Lost 4+ years of professional progress. When covid came, i was able to complete my degree online and graduated in 2021, but because all fresh grad…

I think a lot of folks reading this will immediately be critical and tell you exactly how easy it would have been to solve your problems from spiraling out of control. They are likely largely factually correct. What is not being said is that many folks are operating at the limits of their executive function. Add something like this to an already stressful period of time to such people, and they simply will not be abl…

> What is not being said is that many folks are operating at the limits of their executive function.

I don't think this can be understated. I didn't pay income taxes for two years. Not because I was dodging them, but because I was going through a divorce, single-parenthood, and depression and was barely able to hold onto my job.

2 years later, I got my shit together, paid back taxes and fees (I had the money all along), and it was easy... when I had the bandwidth for it. I just couldn't at the time.

Most things are easy in isolation, it's having patience for someone-who-can't get-your-one-simple-thing-right-because-they-have-too-many-other-simple-things-on-the-go-right-now that is hard.