National Australia Bank Halts Payment to Crypto Platforms Where Scams Are ‘More Prevalent’

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Sujha Sundararajan

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July 17, 2023 10:33 EDT

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National Australia Bank (NAB), one of the ‘big four’ banks in the nation, has blocked some payments to “high-risk” crypto exchanges, where scams are “more prevalent.”

In an official statement, detailing new measures to protect customers from scams, NAB identified crypto scams as the fastest-growing security threat costing Australians A$221 million (US$151 million) in 2022 alone.

“These scammers are part of organized, transnational crime groups. Increasingly, we’re seeing them use cryptocurrency platforms to send stolen funds quickly and often overseas,” Chris Sheehan, NAB Executive for Group Investigations and Fraud, noted.

In addition to blocking payments to certain crypto exchanges, the bank has introduced key measures such as payment prompts and stopping the use of links in unexpected text messages, as a part of NAB’s “bank-wide scam strategy.”

However, the Australian lender did not specify which crypto exchanges would face blocks from the bank.

NAB joins the country’s other big financial institutions including Westpac Banking Corp., Commonwealth Bank of Australia, and Australia & New Zealand Banking Group Ltd, in curbing access to crypto platforms fearing high risks from scams.

Last month, the Commonwealth Bank of Australia (CBA) introduced measures to restrict customers’ ability to send money to crypto exchanges in order to “help protect” them from crypto-related scams.

Binance Australia Could Face More Pressure

According to local reports, crypto exchange Binance’s Australia arm could face more pressure, following the announcement from NAB.

Sheehan said that the banning of payments would initially apply to “several” crypto exchanges, with a scope to expand further.

“You’ve got ‘crypto exchange A’ that we have concerns with, and we’re not going to allow payments go there. If we start to see, as always happens with these criminal groups, they pivot to start targeting something else, we can change our rule settings as we go.”

“Our approach is going to be consistent with the rest of the industry,” he told Financial Review, hinting that the ban would include Binance.

Binance has been facing increased regulatory challenges in Australia. The exchange stopped facilitating all AUD withdrawals after Cuscal, payments facilitator for Binance Australia, winded down its partnership citing concerns over fraud.

Other large Australian lenders, Westpac and the Commonwealth Bank, have reportedly blocked payments to Binance exchange. On July 5, the country’s corporate regulator conducted searches at Binance Australia’s offices amid a US-led regulatory crackdown on the exchange.