Regulators Shut Down Peter Schiff’s Bank; Time To Take The Orange Pill?

One of Bitcoin’s biggest critics Peter Schiff ran into trouble after Puerto Rico regulators shut down Schiff-led Euro Pacific International Bank, citing net capital issues.

Schiff took to Twitter saying that there was no evidence of crimes as portrayed. Blaming the authorities for choosing to close his bank instead of allowing a sale to inject capital, the exec rued customers might lose money as accounts are frozen.

He also complained that the regulators weren’t keen on him owning a 4% stake due to the ‘bad press.’ which according to him resulted in a huge operating loss.

Peter Schiff further said that he spend a considerable amount of fortune to run the small bank and called the compliance costs outrageous.

The news evoked mixed reactions across crypto Twitter. Some crypto advocates took pity on the bank and the customers for their losses.

On the other side, there were several tweets calling out to Schiff criticizing his anti-bitcoin stance as tags like ‘Bitcoin Fixes This’ or ‘Time To Rethink Cryptocurrency’, began to flood his Twitter thread.

Peter Schiff’s Bank Classified As Insolvent

According to a report by the Associated Press on July 1, authorities have temporarily halted the bank’s activities as part of an ongoing investigation, where the bank’s capital supposedly negative $1.3 million by the end of the year 2020 and that, “as such, the entity is classified as insolvent.”

In addition, a cease and desist order was issued to the financial institution by the Joint Chief of Global Tax Enforcement, a multi-government agency targeting tax crimes and money laundering.

With regards to the alleged offshore tax evasion, Peter Schiff remarked despite his dislike of anti-money laundering legislation, as well as other restrictions and taxes, he still complies with them. 

In 2020, Internal Revenue Service agents reportedly paid a visit to the bank informing him that they were looking into the bank’s clients. 

Denying any wrongdoing, Schiff maintained his innocence saying, “Our compliance is so rigorous, and we close accounts so quickly.” He also said he never accepted customers linked to cryptocurrencies, cannabis, or other sectors. 

Finally, Schiff revealed that he had invested $7 million of his own funds to keep the bank functioning and assured that all clients would be able to get a full refund of their money.

Lipika Deka: Lipika is a crypto-journalist at TWJ. A graduate in economics and finance, she has a keen interest in the political and socio-economic facets of blockchain technology and the cryptocurrency industry.