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Oz bank closes Bitcoin business' bank accounts

CoinJar cruelled by Commonwealth Bank

The Commonwealth Bank, Australia's largest bank, has closed accounts belonging to Australian Bitcoin payment processor CoinJar.

CoinJar, which offers tools to buy or sell Bitcoins, and accept them as payment, has blogged about its experiences. The post says it has experienced some dodgy transactions, but no more than most ecommerce outfits.

Founder Asher Tan told The Reg the company handles around 100 transactions a day and that it has found fewer than ten fraudulent transactions, most for under $AUD100. Tan pointed out that CoinJar wears the cost of dodgy transactions.

He's therefore at a loss to explain why the bank stopped processing automatic payments for the business, then shut the business' accounts and those of Tan and his co-founder, causing considerable inconvenience along the way.

“It's frustrating because we can't escalate: our Bank manager doesn't know how to handle this,” he said. Other bank staffers have told him special notes have been made on his account.

Tan said he's always been up-front about the nature of CoinJar's business: that it offers Bitcoin-related services should come as no surprise to the Commonwealth Bank. He's therefore unsure if the bank has closed the accounts because of the small number of fraudulent transactions or because it fears Bitcoin.

Happily, CoinJar has found a new and willing banker in the form of rival National Australia Bank, which knows it deals in BitCoin and doesn't mind. Tan's blog post recommends any other Australian startup make the same choice.

The Reg has asked The Commonwealth Bank to comment on the situation, and it has sent this statement:

"The Bank apologises if the customer feels they have not received an appropriate level of service. We are looking into this matter, though due to customer confidentiality, we are unable to provide further details."

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Bootnote The Commonwealth Bank yesterday announced a record profit of $AUD7.8bn. ®

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