Why Does Varo Suspend or Freeze Bank Accounts?
April 25, 2019
Our job is to keep your money safe and sound.
One of the ways we do that is by following banking laws and government regulations about how we operate. We take every precaution to keep you and the entire Varo community safe. Sometimes we’ll suspend an account if there is something out of the ordinary happening and we need to verify more information with you.
If you are not able to access your accounts or your account is suspended or frozen, it can be frustrating and downright scary even. We get that. The good news is that if everything is in good standing, this is most likely never going to happen to your account and if your account is suspended it can generally be resolved quickly with an email with our customer service team.
Here are a few reasons your account could get suspended or frozen:
Reason #1 We need more information, or we spot unusual activity.
Most of the time an account is suspended temporarily because we simply need more information. We’ll send you an email right away letting you know what we need; when you respond with that requested information and we can verify it, we can get your account up and running ASAP.
We also know things happen: Your phone or wallet gets stolen; someone other than you tries to get into your bank account; someone has stolen your identity; or maybe an online vendor was shady. Or maybe you’re just traveling to a new place or are making transactions outside your normally scheduled activity. Anytime something happens that’s out of the ordinary, we might temporarily suspend your account to ensure that no one is using your account without your consent.
Our systems are set up to detect any different or unusual behavior and immediately flag the account so we can keep your money safe and sound. Again, the vast majority of the time, all it takes is a quick email with customer service and everything is solved.
Reason #2 We cannot allow certain types of activities.
As a financial company, along with The Bancorp Bank, who issues our bank accounts, we must follow the letter of the law when it comes to banking rules, regulations, and conduct. A Varo Bank Account cannot be used to do things like online gambling, human trafficking behavior, or any prohibited (selling counterfeit or stolen goods) or illegal activity. This activity may cause the account to be frozen or terminated.
Our regulators include: state regulators; the Federal Reserve Board; the Federal Deposit Insurance Corporation (FDIC); the Office of the Comptroller and Currency (OCC); and the Consumer Financial Protection Bureau (CFPB). Each regulation is designed to ensure that every participant in the banking system — that’s thousands of banks and companies across the United States — is operating in a similar way. Following procedures like this is what keeps good order in our national banking system, which is one of the most secure in the world.
In sum, we follow the rules to ensure that individuals with illegal motives — terrorists, fraudsters, and money launderers for example — can’t use our system for criminal activity. These rules help to protect you, keep your money safe, and keep the bad guys out.
Reason #3 We can’t allow accounts to be used for business purposes.
Today, our accounts are set up only for personal use and can’t be used as a bank account for your business. (You can find the legal terms in our Varo Bank Account Agreement.) Your account may be suspended until we get confirmation from you that it's for personal use. If your account is being used for business purposes, it may be closed.
If you’d like to see Varo add business accounts in the future, please weigh in with our app’s Suggest a Feature. (We read every suggestion!)
More ways we keep you safe and sound
In addition to monitoring your account for unusual activity, we also offer top-tier security features so you can take action and stay safe on your mobile app.
You can instantly lock your card in the app and get automatic account alerts in the app to ensure you know exactly what’s happening in your account at all times.
We also keep access to your mobile app safe with powerful 256-bit AES encryption, access control, secure processes, and audits.