EXPOSED: Transparency on a Massive Breakdown that led to Violations Discrimination and Wrongdoing

𝕮. 𝕰. 𝕳𝖎𝖗𝖘𝖈𝖍𝖆𝖚𝖊𝖗

Introduction

From Pre-Transaction to Participation & Approval

As a longtime customer of Northwest Bank R.H. didn’t anticipate any resistance at the bank. After all the money came from another account in his name by way of a wire transfer, and the funds would be sent on to another account where he is the recipient on it as well. The final destination however is an account provided by crypto.com to help facilitate regular trading activities. It is important to note that not only was the account with crypto.com FDIC insured but the entire exchange is regulated, reputable, and Crypto.com is significantly more well-established than Northwest Bank in terms of global reach, market presence, and financial influence. Crypto.com is a major player in the fintech and cryptocurrency industry, serving millions of users worldwide with a wide array of financial products, including crypto trading, a Visa card program, DeFi services, and regulatory compliance in multiple jurisdictions.

Northwest Bank, on the other hand, is a regional financial institution with a limited geographic footprint. It primarily operates as a traditional bank with standard retail and business banking services but lacks the technological innovation, international reach, and market influence of Crypto.com.

As we shift the focus to the transaction that caused all of this, I should mention that prior to NW Bank, there was an attempt to use PayPal that was unsuccessful. However, after considering what takes place over the next few days it seems logical that NW Bank probably caused that failure also. But we can’t prove that no matter how obvious it is.

The first transaction attempted using the NW bank checking account was for $2000 using the accounts debit card. This would fail due to a $1000 daily limit that was in effect for this card. At the time that was not known and it was assumed that these were failed because they were a bit large and considered irregular purchases for R.H.’s account. The bank employees had went home for the day a long time ago and so there was no choice but to wait until morning to resolve the problem.

Early, after 9am next morning R.H. proactively phoned Northwest Banks fraud department. He explained there were several transactions that failed the call was to validate their authenticity. The agent from the bank educated him that the actual cause of the failures was the $1000 limit, but not to worry because she agreed to suspend the limit in order to let this one time transaction be processed. The call lasted almost 45 minutes. Much of the time was spent explaining what has happened and that buying crypto is not by mistake or result of a scam. This transaction was successfully processed on the banks side but for some reason hung there “pending”. Pending status means basically that the bank has seen the purchase and allocated the funds from your account to a temporary holding place where it will wait for the settlement request from the merchant. But when it didn’t settle R.H. contacted crypto.com just to make sure they know to issue a request. It would become apparent later that the settlement request had already been issued at this point and this rep was just slightly unclear on this process.

After going back and forth between the two for an hour attempting to get a straight answer, they somehow magically coincided as both firms set the expectation that the funds would arrive on Friday 2–14–25. They also made sure to disclose that it could in some cases take 3 to 5 days to settle and if for some reason it reaches the 7th day, an automatic refund would be issued. They also made sure to disclose not to try and cancel it or anything just allow it to go through.

The next afternoon (2-13–25) a lady from NW Bank, at a branch in R.H. hometown called, she said fraud urged her to make the call and just talk to the customer to validate the transactions legitimacy. After convincing her that this was a coherent decision and not the result of being scammed or anything she indicated she was satisfied as far as questions and reiterated to allow the transaction to settle.

Still nothing until we arrive at Friday afternoon. The phone rings and you could almost see the confusion wash over the man as he is notified that the bank is closing the account effective now. When asked why the bank said because it is a crypto purchase and so that constitutes fraud related activities. However, this whole situation is illegal.

Regulatory Violations & Wrongdoing:

• Bad Faith Business Practice: The bank knowingly assisted in facilitating the transaction, only to use it against him later.

• Deceptive Banking Practices: Raising the debit cards limit to allow the transaction, then later labeling it as problematic, constitutes misleading conduct.

• Potential Breach of Contract: If their terms and conditions did not explicitly state that cryptocurrency transactions were prohibited, then retroactively penalizing for one is an arbitrary enforcement of unwritten rules.

When he informed the bank that his tenants make rent payments directly to this account and it must remain functional their response was “That’s a red flag too”. But the transaction was successfully processed, the fraud department representative was complicit in facilitating it with no indication of concern from the bank at the time.

Regulatory Violations & Wrongdoing:

• Failure to Provide Clear Communication: If the bank had legitimate concerns, they should have taken action before the transaction, rather than approving it and then retroactively labeling it suspicious.

• Violation of Fair Banking Principles: Closing an account after actively enabling the transaction suggests a retaliatory move rather than a justified one.

• Failure to Follow Internal Protocols: If their fraud team initially determined the transaction to be legitimate, then closing the account afterward is inconsistent with proper fraud prevention procedures.

At the time of account closure, this transaction had not yet fully settled, meaning the funds were still in transit. If the transaction is reversed due to the account closure, you have no clarity on whether the money will return to the original account, the recipient, or be held indefinitely by the bank. The bank has provided no written confirmation regarding how they will handle the remaining balance or pending transactions. Since the money came from a loan, they are now left in financial limbo, unsure whether they will still be responsible for repaying a loan with funds that may not ever be recovered.

Regulatory Violations & Wrongdoing:

• Failure to Provide Clear Refund Policy: Any responsible financial institution should be able to outline what happens to pending transactions upon account closure.

• Negligence Leading to Financial Harm: If funds are lost or significantly delayed, the bank should be held liable for damages.

• Failure to Adhere to Industry Standards: Most banks have clear protocols for handling account closures and pending transactions, yet Northwest Bank has failed to provide any reassurance or documentation regarding the outcome of the funds.

Potential Retaliation Against Cryptocurrency Transactions

Another customer of Northwest Bank in a different city reported an identical experience: his account was closed immediately after a cryptocurrency-related transaction. The pattern suggests that Northwest Bank may have an undisclosed internal policy against cryptocurrency transactions, even though they took active steps to facilitate one of these examples. If the bank does have a policy against cryptocurrency transactions, they should be required to disclose it clearly rather than secretly targeting individuals who engage in such transactions. The bank had to either file a fictitious SAR since there was nothing suspicious and literally a fraud department employee of the bank was complicit in the transaction by removing the imposed spending limits or in other words putting their rules on pause to let him make this purchase. The agent was fully educated on all factors of the purchase, which originated and terminated at accounts of his own, held at other firms. How can it be suspicious when fraud made sure it went through? The other possibility is that all the smoke and mirrors nonsense with the card and account were to hide the avoidance of not filing a SAR when they claim it is unusual activity that warranted the account closure. Remember that fraud was contacted prior to sending the money and proactively.

Regulatory Violations & Wrongdoing:

• Discriminatory Banking Practices: If Northwest Bank is systematically closing accounts due to cryptocurrency transactions but not explicitly stating it in their policies, they are engaging in deceptive and discriminatory behavior.

• Violation of Consumer Protection Laws: Customers have the right to clear terms of service; hidden policies used to penalize specific financial activities are a breach of fair business practices.

Conclusion — Legal & Ethical Failures of the Bank

Northwest Bank was complicit and facilitated this transaction by raising the cards limit, then retroactively targeting the customer for completing the transaction. They failed to communicate properly about the closure or even that they discourage crypto purchases, leaving the customer in financial uncertainty. They provided no clear path for appeal or recovery of pending transactions. They potentially engaged in targeted discrimination against cryptocurrency transactions. They caused emotional distress by putting their customer in financial limbo, with no assurance that the funds would be properly handled.

Given these clear violations of standard banking procedures, fair business practices, and possibly federal banking regulations, he will be seeking recourse through regulatory complaints, legal action, and public exposure of these actions. Northwest Bank must be held accountable for their deceptive, retaliatory, and damaging conduct.

Contractual Obligation — The bank’s own terms and conditions state that if their actions prevent or delay a customer from making an investment, they will accept liability. This constitutes an express contractual obligation to ensure customers can execute investment transactions without unjustified interference. Definition of Investment — Cryptocurrency, including assets such as Bitcoin and Ethereum, is legally recognized as an investment in multiple jurisdictions, including under IRS guidance (which treats it as property for tax purposes) and SEC statements acknowledging certain digital assets as investment contracts. By preventing customers from purchasing cryptocurrency, the bank is interfering with an investment decision. Breach of Contract — By imposing a policy that blocks cryptocurrency purchases, the bank is actively violating its own contractual commitment. This action constitutes a breach of contract because it prevents or delays investment transactions in contradiction to its stated obligations. Unfair and Deceptive Trade Practices — If the bank is enforcing this policy arbitrarily or inconsistently, or failing to disclose it in a manner that allows customers to make informed banking decisions, this could constitute an unfair or deceptive trade practice under consumer protection laws. Potential Damages and Liability — Customers who have suffered financial losses due to the bank’s interference with investments (e.g., lost profit opportunities, additional fees, or transaction failures) should have grounds for seeking damages. If the bank’s policy violates its own terms, affected customers should be entitled to financial compensation or injunctive relief to prevent further interference.

Aftermath

No matter how you break this down, the bank’s handling of this situation is a complete failure at every level. Their own policies contradict their actions, and their repeated interference in legitimate transactions isn’t just incompetence — it’s outright obstruction. The bizarre cycle of closing and reopening accounts, fabricating claims about lost cards, and shifting explanations to justify blocking investments raises serious red flags. Was this negligence, internal disorganization, or something more deliberate? Either way, it demands investigation. Financial institutions are supposed to provide security and reliability, not chaos and deception. The question now is, who will hold them accountable?

Note from the author;

I was an actual real victim of this discriminatory policy structure or whatever it is and personally I hope it becomes a class action case. Something needs to be done about firms with these abusive tactics.

Here are the official links to the regulatory agencies you might need:

• SEC (Securities and Exchange Commission): https://www.sec.gov

• FTC (Federal Trade Commission): https://www.ftc.gov

• OCC (Office of the Comptroller of the Currency): https://www.occ.gov

• CFPB (Consumer Financial Protection Bureau): https://www.consumerfinance.gov

Northwest Bank

Bank Scandal

Rampant Fraud

Abusive Policies

Written by 𝕮. 𝕰. 𝕳𝖎𝖗𝖘𝖈𝖍𝖆𝖚𝖊𝖗