How to Avoid a Bank Account Blocking

The blocking of the company's current bank account always happens unexpectedly and at the most inconvenient time. But it’s not illegal actions of the bank authorities that the business suffers from - often the companies themselves are to blame that they cannot manage their funds.

What can be the reason?

There are three types of grounds for blocking:

-       tax violations - at the request of the Federal Tax Service. For example, in case of non-payment of taxes, delay in filing reports

-       suspicious transactions - upon the decision of the bank. For example, transactions without economic benefits, transactions that do not correspond to the activities of the organization, regular withdrawal or crediting of large amounts, transfer of a large amount to a non-resident.

-       compulsory collection of funds - at the request of bailiffs of executors on the basis of a writ of execution.

What’s next?

In the first case, at the request of the Federal Tax Service, transactions on the account are suspended, that is, the bank stops all expenditure transactions of the client until the requirements of the tax authorities are met.

In the second case, the bank, if there are grounds provided for by the law on combating money laundering, may:

- completely block the account; or

- suspend a specific questionable transaction until a response from the client and receipt of supporting documents; or

- refuse to carry out a specific questionable transaction if the client has not provided the requested documents or the bank has suspicions that the transaction is being carried out for the purpose of money laundering.

In the third case, the bank, on the basis of a writ of execution, either immediately writes off the required amount from the client's current account, or, if the funds are insufficient, reserves this amount. As a result, any receipts to the account will first of all pay off the debt under the writ of execution.

How to avoid account blocking?

1. Keep accounting records in full and on time, pay taxes, fines and penalties.
2. Always correctly indicate the purpose of the payment.
3. Make sure that payments correspond to the selected activity according to OKVED.
4. Check counterparties and avoid transactions with suspicious companies and people. In order to do this, you can develop a counterparty verification system specific to your business. TEAM specialists will be happy to do it for you!
5. Timely respond to bank inquiries, provide the entire package of supporting documents for the transaction.
6. When choosing a settlement with both legal entities and individuals, choose a predominantly non-cash payment method. Cash withdrawals exceeding 50% of the turnover in 90 days will definitely raise the bank's suspicions.
7. Regularly check the availability of enforcement proceedings and completed court cases against your company.

If your current account is blocked, immediately contact TEAM for qualified assistance - we will solve this problem as soon as possible!