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Australian Banks Cleared of Colluding Against Bitcoin Companies

Last Updated March 4, 2021 4:46 PM
Samburaj Das
Last Updated March 4, 2021 4:46 PM

Following an investigation, the Australian Competition and Consumer Commission (ACCC) has cleared Australian banks of colluding to deny banking services to local bitcoin companies in the country.

An investigation requested by Senator Matthew Canavan suggesting the ACCC should look into the possibility of banks colluding together to close the bank accounts of bitcoin companies has resulted in the regulator concluding that the banks did no wrong, as reported by the Australian Financial Review .

In response to the request, ACCC chairman Rod Sims wrote to the senator telling him that there was no evidence found that banks had colluded prior to the closure of at least 17 bitcoin companies’ bank accounts.

Having seen the letter, the publication also revealed that the ACCC had contacted several banks to conclude that none of them had acted against the interests of competition. Furthermore, Sims also wrote that banks had the right to choose who they dealt with. He also suggested that each back had acted individually while denying services to local bitcoin companies.

As reported by the AFR, Sims wrote:

It appears that banks have individually decided to stop providing bank services to digital currency businesses in order to ensure their ability to meet their regulatory obligations and manage their risk.

The available material also suggests that banks have made their decisions at different times, and with different outcomes.

In adding to the claim, Sims noted that one of the banks had decided against dealing with digital currency businesses in 2011 while another adopted a similar policy in 2015. He also claimed that some banks are open to provide banking services to digital currency companies, “on a case by case basis.”

Sims considered investigating claims of anti-competitive behavior by Australian banks following Queensland Senator Matthew Canavan’s suggestion in September 2015. The investigation began soon after, with Sims revealing that the ACCC sought answers from banks to explain their actions in closing bitcoin companies’ accounts.

A Sub-Standard Investigation?

The decision taken by the ACCC has found criticism from Labor Senator Sam Dastyari and bitcoin companies in Australia. The publication also reports that the regulator had not even spoken to affected bitcoin companies during the course of its investigation, prior to its conclusion.

Remarking that the ACCC’s conclusion was “utterly astonishing,” Senator Dastyari also revealed allegations of banks blacklisting bitcoin industry related individuals from opening personal banking accounts.

In response to the suggestion that bitcoin companies weren’t contacted, Sims told the AFR that it had communicated with some affected bitcoin companies. The regulator’s chief also claimed that banks had provided good access to documents with credible and different individual explanations to debank bitcoin companies.

“Our investigators are well trained and can sniff things pretty quickly, and this had the smell of being a very reasonable explanation,” Sims told the publication.

Despite concerns and claims of anti-competitive practices by the banks toward bitcoin companies, the recently concluded investigation had the ACCC conclude that there is no need to launch an in-depth investigation.

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