Record different restrictive measures separately
For law-enforcement freezes, verify the authority's powers, the target and the scope; for sanctions restrictions, verify the applicable regime; for internal platform risk review, state the provisions relied on, the facts and the extent of necessity. Do not describe internal review as a government freeze, and do not take possession of all customer assets on the ground of an ordinary commercial dispute. Whether investigation fees may be charged, arrears offset or security deposits retained must rest on a separate lawful basis and cannot be derived without limit from general risk-control clauses.
Submitting a suspicious report does not confer unlimited power of disposal
Current guidance from the UK NCA explains that procedures such as DAML provide a specific criminal-law defence arrangement, not blanket approval of or an endorsement of the legality of the proposed activity. This suggests that platforms should analyse reporting, suspension of transactions and disposal of assets separately. Whether there is a waiting period, a permission and a prohibition on disclosure differs across jurisdictions, and a single global template under which assets automatically vest in the platform after a certain number of days of freezing cannot be applied universally.
Hypothetical scenario: balances still need to be dealt with after account closure
Assume a customer cannot provide the information required for continued service, and the platform terminates the relationship under valid rules. Termination does not mean the balance becomes platform revenue; it is still necessary to verify whether any statutory restrictions exist, who is entitled to receive the funds and what is a safe method of return. Where a suspicious source is involved, returning the funds directly by the original route is not necessarily lawful either; where there is no basis for continuing restrictions, indefinite delay merely because of customer complaints or refusal to accept new terms is inappropriate.
Set reviewable boundaries for necessary restrictions
A restriction decision log may be established, recording the facts, scope, approver, review events and conditions for lifting. Without breaching confidentiality requirements, explain to the customer the service status, the supplementary materials that may be provided and the channels for appeal. Apply a consistent process to the same facts and review new evidence promptly. Where standard-form contracts from jurisdictions such as the UK are used, the validity of unilateral restriction and exemption clauses should also be reviewed; it cannot be assumed that every restriction is reasonable merely because the user has ticked a box.
At the system level, "prohibition on new deposits", "prohibition on withdrawals", "suspension of specified transactions only" and "account termination" can be designed as distinct states, so that a single operation does not expand its impact. Each state should specify who may change it, which queries are permitted and how to exit it, and the displayed balance should be distinguished from the actually available amount. If the front end still shows funds as withdrawable at any time while the back end has imposed a long-term restriction, this readily gives rise to new disputes. Synchronising customer notification with actual functionality also helps prevent the mistaken receipt of further funds that could not in any event be processed.
Recommended actions
- Distinguish four categories of basis: authority freezes, sanctions restrictions, internal review and commercial disputes.
- Record the scope, approval and review conditions for each restriction, and do not provide for automatic forfeiture of balances.
- Design lawful return, appeal and information confidentiality procedures in advance.
This content is for general information only and does not constitute legal advice. Please consult a qualified lawyer about specific matters.
References
- UKFIU SARs Best Practice, Chapter 3: Understanding DAMLs and DATFs (December 2025) — UK National Crime Agency (NCA)/UKFIU
- Avoid unfair terms in sales contracts: Unfair business contracts — UK Government
