Why has my bank blocked my Spanish bank account?
IF YOUR BANK HAS blocked your Spanish bank account, you have probably wondered whether this measure is legal and what the reason for the closure is. The answer is that it is legal, and the bank has the right to do so.
This is because money laundering and terrorist financing regulations require banks to request the documentation they consider necessary to identify and monitor the account holder and their operations.
According to the Bank of Spain, there are different reasons why a bank can block or freeze its customers' accounts.
1. Blocking of a bank account due to lack of identification documents:
If your Passport, Residence Card, Foreigners' Identity Card, or Personal Identification Card has expired, be careful, because you could end up with your bank account blocked. Banks are required by law to identify all their customers and to ensure that their documentation is up to date.
So, if the bank detects that your personal identification document is not up to date, it can block your account, as by law this is considered a justified cause.
2. Blocking to comply with the law on the prevention of money laundering:
The bank must ask you for information about your economic activity, known as KYC (know your customer). This is an anti-fraud measure that all banks must follow to prevent money laundering and terrorist financing.
If the bank asks you for information related to your professional activity and you do not provide it, it can take measures such as blocking your account until you provide the required documentation.
3. Freezing due to discrepancies between account holders:
If you share an account with one or more account holders and you all issue contradictory orders, the bank can freeze the account if it detects incompatibility between transactions in order not to take sides in a dispute (such as during a divorce or the separation of two or more partners in a business).
4. Account blocking due to the death of the account holder:
This is a very common case of non-residents in Spain who die leaving assets and bank accounts open in Spain. In this case, their heirs find that the Bank has frozen the deceased's account and that the bank has cancelled all direct debits.
It is important to note, however, that in any case, the bank must notify the account holder(s) before blocking the account and, if this is not possible, the announcement must be made immediately afterwards.
The problem here is that many customers receive a letter at their home in Spain and it is not until they return that they realise that their bank account has been blocked.
Others, on the other hand, receive an email instructing them on the documentation and how to submit it digitally to the bank, which for most clients is more complicated than taking the documentation to the bank in person.
It is for these reasons that many of our clients who do not live in Spain ask us for help from their country to unblock their bank account.
The solution to this problem that we provide at Inmo Investments, is to grant a Power of Attorney beforehand to your lawyer in Spain. With this power of attorney your lawyer can easily unblock your account on your behalf.
In this way, you will not have to wait until you return to Spain to do it yourself, bearing in mind the serious consequences of closing the account, such as non-payment of local taxes or utility bills, generating unnecessary surcharges or penalties for the account holder, which could have been avoided in a simple way.
If you find yourself in such a situation and need help to reactivate your bank account in Spain, you can request more information from our legal department by sending an email to the following address: email@example.com. We will be happy to help you.