Why do fiat remittances encounter bank review?

Fiat remittances encounter bank reviews usually because banks and financial institutions must comply with various regulations and compliance requirements, mainly to prevent money laundering, terrorist financing and other illegal activities.

The following are common reasons for bank reviews:

1. Anti-Money Laundering (AML) Regulations: Banks will check the source of remittances, amounts and counterparties to ensure that funds are not used for money laundering activities. Large remittances or funds from unknown sources are more likely to trigger reviews.

2. Know Your Customer (KYC) Procedures: Banks need to confirm the identity of customers and understand their transaction background. This includes verifying the identity information of the remitter and recipient, especially for new or unusual transactions.

3. Large Remittances or Frequent Transactions: Remittances exceeding a certain amount may trigger the bank's automatic review system, especially cross-border remittances. Accounts with frequent large transactions will also be monitored.

4. Suspicious Transaction Behavior: If remittance activities do not match account history or are inconsistent with the customer's financial background, banks may conduct additional reviews of such transactions.

5. Sanctions and Blacklisted Countries: If remittances involve sanctioned countries or individuals, banks will block or further investigate according to international regulations (such as OFAC sanctions lists).

6. Unknown Source of Funds: Banks may require remitters to provide proof of the legal source of funds, especially when the amount is large.

7. Intermediary Banks or Cross-Border Transactions: Cross-border remittances may involve multiple banks, and the review procedures of intermediary banks may also cause delays or require additional information.

These review measures are to ensure the security of the banking system and comply with international and domestic laws and regulations.