on the crypto
After getting 100 times her initial investment, Bank Hapoalim denies depositing $ 320 in profit Esther Freeman made from her BTC investment, citing that she used money to become a HODLer.
Israeli retiree Esther Freeman reportedly transformed a 10.000 ILS investment in Bitcoin, worth about $ 3 at the time, into ILS 1.000.000 (about $ 324) over eight years. However, Hapoalim Bank, one of the largest banks in the country, denied accepting the profits as the initial investment source may have had a connection with illegal financial operations.
Cash is the problem
In 2013, a 69-year-old retired Israeli citizen, Esther Freeman, decided to enter the cryptocurrency market by investing around $ 3.240. Despite her 69 years, the retiree said she was "young in spirit" and that her younger relatives mainly influenced her decision:
“I listened to my son and my grandchildren, the young kids, and I said a try would be given. Without any knowledge on the subject, in the real innocence of a common citizen. I never thought 10.000 NIS would become nearly 1 million NIS ”.
Even though Freeman multiplied his investment by 100 times, Bank Hapoalim refused to deposit the transferred amount from the FIAT cryptocurrency platform it used while the initial deposit years ago was made in cash.
Therefore, the source of the funds could be related to "money laundering or terrorist financing," the bank explained. Additionally, the institution outlined some of the notorious dark sides of the digital asset industry that banks typically provide:
"The characteristics of virtual (ie digital) currencies allow them to be transferred anonymously and unsupervised, often bypassing the need to use the financial factors that apply to the anti-money laundering and terrorist financing regime."
The lawyers enter the scene
To have a better chance of getting his funds, Freeman appointed Shaul Zioni as his lawyer and filed a lawsuit against the bank. The retiree said she has been a loyal bank customer over the years and needs money to help one of her children:
“The bank knows my conduct. I have no money anywhere else, only at Bank Hapoalim. They know I don't launder money or do business outside the bank. I am retired. All four of my children have bank accounts. The money I need to help one of my children buy an apartment ”.
Freeman's lawyer, Shaul Zioni, also spoke on the matter. He noted that his client wants the court to declare the source of the money invested in bitcoin it is "known, clear and supported by references". Over the years, Freeman has kept his Bitcoins in various digital wallets, in which no further transactions have been made, Zioni added.
Subsequently, the court ruled that the financial institution should not limit the account activity to its customers just because they are linked to digital currencies. The Hapoalim bank received the case and promised to study the details and "respond in the usual way".
Israel wants to treat cryptocurrency assets like banks
Due to the risks of using digital assets in criminal activities, Israeli authorities recently planned to enforce counter-terrorism banking rules.
As of now, the government has had to spend significant resources to uncover fraud in areas where companies weren't required to report all financial transactions. If the new policy becomes active, all cryptocurrency-related businesses will have to file reports like banks.
The new rules should also benefit small digital assets businesses as reporting promises to be accessible and modernized. Therefore, such companies could provide greater confidence in the security of their services.
