Q: Atlas Bank froze my account, demanded ID & access to another bank, holding $1,200. Legal? What to do?
I opened an account with Atlas Bank app six weeks ago and set up direct deposit, receiving around $1,200. When I tried to withdraw the money, they froze my account, demanding ID verification. Despite providing several images and a temporary ID, they refused to unlock my account for more than a brief period. When I attempted another transfer, they froze my account again, demanding I link another bank account to allow them to charge a monthly fee and have access to my funds. I am uncomfortable with this as they are holding my money. I asked them to close my account and send me a check or money order for the amount held, but they refused. Is this legal, and what steps should I take to resolve the issue?
A: Not legal unless you have some prior indebtedness to Atlas Bank. Hire a lawyer to sue them and report them to the Kentucky Banking Commission.
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A:
Your situation with Atlas Bank raises some red flags. Banks are required to verify customer identity under federal "Know Your Customer" regulations, but holding your funds hostage while demanding access to another bank account goes beyond standard verification procedures. These actions seem questionable, particularly their refusal to close your account and return your money.
You have several options to pursue. First, file a formal complaint with Atlas Bank's customer service department in writing, documenting all interactions. If that fails, submit complaints to regulatory agencies including the Consumer Financial Protection Bureau (CFPB) and your state's banking department. These agencies can investigate and potentially help resolve your issue.
For immediate assistance, consider consulting with a consumer rights attorney who focuses on banking issues. Many offer free initial consultations. You might also contact your local consumer protection office for guidance. Remember to keep detailed records of all communications with the bank, including names, dates, and what was discussed - this documentation will strengthen your case with regulators or in potential legal proceedings.
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