Why Bank Accounts Get Blocked in the Czech Republic

Key takeaways

A bank account in the Czech Republic can be restricted or blocked because of enforcement proceedings (exekuce), decisions by public authorities, the bank’s internal AML/KYC checks, or transactions that look unusual or risky. The best prevention is simple transparency: keep documents proving the source of funds, do not ignore the bank’s requests, separate personal and business flows, and avoid transactions with no clear economic rationale. If a restriction has already happened, the fastest path is to identify the type of block and follow the right scenario.

Introduction

An account block in the Czech Republic rarely means “the account is closed forever”. In practice, it is usually one of three situations.

• the bank temporarily stops a payment or certain operations until it receives an explanation and documents,
• the account is seized because of enforcement proceedings or a measure under a court decision,
• the bank limits service and asks to end the relationship, giving the client a short period to withdraw funds.

For businesses, this is especially painful when payments to suppliers, rent, salaries, or taxes are frozen. For individuals, the risk is different: you often find out only when the card stops working.

Below we break down the main reasons in the 2024–2025 reality and outline practical steps that reduce the risk of getting blocked.

Why banks in the Czech Republic block customer accounts

A blocked account does not automatically mean the client “did something wrong”. Most often it is a temporary restriction while the bank reduces risk and meets legal obligations. In the Czech Republic, banks have to do three things at the same time.

• execute court decisions and instructions from enforcement authorities,
• comply with AML/CFT requirements and sanctions compliance,
• keep customer data up to date and manage fraud risks.

From the outside, restrictions can look different.

• the bank stops one specific payment and sends it for manual review,
• it limits certain functions (cards, international transfers, outgoing payments),
• it temporarily freezes transactions until documents are provided,
• in extreme cases, it initiates termination of the relationship and asks to close the account.

Typical reasons why an account or specific transactions get restricted:

• transactions do not match the client profile (a sudden jump in turnover, new countries or counterparties, unusual amounts),
• the bank has outdated information about the client, business activity, or beneficial owners,
• signs of “transit” use of the account and circular flows with no clear economic rationale,
• higher‑risk AML activity (cash, cryptoassets, P2P, complex chains of transfers),
• an external legal basis from a competent authority (enforcement, a court measure, a request within an investigation).

It is important to understand that a bank is not obliged to disclose the details of its internal scoring, and it cannot always comment on the reasons for restrictions in detail until the review is finished. The AML Act (Zákon č. 253/2008 Sb.) includes a mechanism called odklad splnění příkazu klienta — a deferral of executing a client’s instruction when a transaction raises justified doubts. The official text of the law is published in e‑Sbírka.

Reasons for account blocks for individuals, sole traders, and companies

To avoid mixing different situations, here are the main scenarios by client type. In some cases, the account is restricted based on a decision of a competent authority; in others, the bank temporarily stops operations as part of a compliance review.

1  Enforcement proceedings and seizure of funds

This is the most “mechanical” scenario. If an individual or entrepreneur is subject to debt collection, the account can be affected by a seizure. People often learn about it only when money is taken or the card stops working.

What matters:

• this is not “bank compliance” — it is execution of an enforcement decision,
• the rules for access to funds differ from an AML restriction.

For individuals, Czech law provides a tool called a protected account (chráněný účet). The Czech National Bank (ČNB) publishes explanations of what it is, who it is for, and how to arrange it; the Ministry of Justice describes the procedural steps.

Practical prevention:

• monitor your mail and the datová schránka service if you use it,
• do not delay communication with the court bailiff (exekutor) if you have already received notices,
• understand which inflows qualify as protected income and how to process them correctly via chráněný účet.

2  Court and law‑enforcement measures

Sometimes an account is restricted within criminal proceedings, interim measures securing a claim, or other court decisions. The key factor is the legal basis and the document the bank relies on.

Prevention here is not banking but legal:

• manage contractual risks and disputes,
• avoid situations where assets can be subjected to interim measures.

3  Tax and administrative restrictions

Depending on the case, restrictions can arise due to debts and tax or administrative enforcement procedures. The exact mechanism depends on the type of debt and the procedural actions taken. One practical rule is consistent: when a business accumulates arrears and does not maintain communication with authorities, the risk of coercive measures increases.

Practical prevention:

• discipline with taxes and reporting,
• timely restructuring of debts if the problem already exists.

4  AML/KYC reviews and the bank’s compliance checks

This is the most common source of sudden blocks in 2024–2025 — especially for businesses with international payments, freelancing, investments, real estate, and cryptoassets.

The bank needs to understand three things:

• who you are and who ultimately controls the company,
• where the money comes from and why it is being received,
• what you are doing with the funds and whether this matches your profile.

ČNB, as the supervisor of the banking sector, emphasizes regular updating of client data and a risk‑based approach. In practice, this means a bank may request documents not only when you open an account, but at any time if your profile changes or a monitoring trigger fires.

FAÚ, the Financial Analytical Office and the authority responsible for the Czech AML system, publishes guidance on customer due diligence and general AML principles. This is why different banks tend to ask similar questions and request similar documents.

Common reasons why compliance stops transactions:

• a large amount arrives, but the client profile does not show that level of turnover,
• funds arrive from a counterparty with no clear link to the stated business activity,
• payments move through several accounts with no obvious purpose, essentially passing through,
• the company has a complex beneficial ownership structure and documents have not been updated,
• the client ignores the bank’s emails or replies with “personal funds” without evidence.

5  Breach of bank terms and contract red flags

Sometimes restrictions are not driven by law but by the bank’s terms of service.

• the account is used for a purpose it was not intended for, for example a personal account for regular business settlements,
• mass payments to third parties under a tariff that does not fit this pattern,
• suspicion that the account is being used as a transit account.

This is especially relevant for entrepreneurs who start with a personal account and gradually drift into business operations.

High‑risk operations that most often trigger reviews

Below is a list of typical operations that most often lead banks to request supporting documents. This does not mean they are prohibited. It means that without preparation they can easily turn into a restriction.

Unusual large inflows and transfers

Example:

Imagine an individual receives 1,200,000 Kč with the note “consulting fee”, while the bank’s profile shows the person as an employee with a stable salary of around 60,000 Kč. For transaction monitoring, this is a sharp break with the usual financial pattern, so the payment will almost certainly be routed to manual review with a request for documents and explanations.

What the bank is likely to request:

• a contract,
• proof that the service was provided,
• an invoice (faktura),
• evidence of tax treatment, either tax paid or a clear plan to declare the income.

Payments from sensitive jurisdictions

For banks, it is not only the amount and the counterparty that matter, but also the country the funds come from or go to. Some jurisdictions are treated as higher‑risk due to sanctions exposure, weaker control of financial flows, or frequent use in money‑laundering typologies. Even with a fully legitimate deal, one geographic factor may automatically trigger enhanced due diligence and temporarily stop a payment until clarifications are provided.

Example

A Czech company receives payment under a contract from a client registered in a jurisdiction that banks classify as higher risk. The payment reference is correct, the contract and invoices exist, but the bank still asks for an expanded set of documents. Typically, it requests disclosure of the counterparty’s ownership structure, meaning the ultimate beneficial owner, confirmation of actual business activity, an explanation of the economic rationale, and documents supporting the source of funds. If money arrives through intermediary banks or the payment jumps across several countries, the probability of a temporary hold increases.

The key point is not missing documents. The country and the payment route obligate the bank to check more than in a standard case.

Frequent cash activity

Regular cash deposits and withdrawals with no clear logic almost always lead to questions.

Example

An individual or sole trader withdraws large sums in cash several times a month and then, a few days later, deposits them back in smaller parts without an understandable reason. From the bank’s perspective, this can look like an attempt to break the chain of origin of funds or simply atypical behavior, so a request for explanations and documents is very likely.

What helps:

• proper cash‑handling discipline,
• an understandable business process, for example retail cash revenue,
• documents supporting the source of cash.

Cryptoassets, exchange withdrawals, P2P

Cryptoassets are not forbidden by default. The problem is that the bank must understand the origin of funds, and clients often do not have a clear document package ready.

From late 2024 the EU tightened rules for transfers of cryptoassets, the so‑called travel rule, and FAÚ has published guidance for providers of crypto‑asset services. In practice, both banks and VASPs tend to ask more questions about the owner, the recipient, and the source of funds.

What to prepare in advance?

• statements from exchanges and wallets, and transaction history,
• proof of the original fiat source of funds,
• documents for profits and taxation, if relevant,
• a clear explanation of your P2P model, if you used it.

International transfers and services

Freelancing, consulting, agency work, marketing, IT, design. These are normal sectors for banks, but they often attract attention because a service cannot always be verified from a single payment. Compliance therefore focuses on whether the money flow is coherent.

What may raise concerns for the bank?

• a vague payment reference with no link to a specific project or contract, for example just “services”,
• many inbound payments from individuals in different countries while you claim a B2B model,
• a sudden jump in turnover or new countries or counterparties without updating your client profile,
• funds arriving through payment intermediaries, marketplaces, or aggregators while you cannot quickly explain who the end payer is,
• rapid onward transfers of incoming funds, especially to third‑party accounts or to crypto, which looks like transit behaviour,
• mismatches between stated activity and what you are paid for.

Example

A Czech sole trader receives payments from clients in the US and the UK for IT services. Funds arrive via a payment service with a short reference like “IT services”, and within a day or two most of the amount is moved on. Part goes to a personal account, part to a foreign account, part to a crypto exchange. From a bank’s perspective this chain contains multiple triggers: an intermediary, insufficient project detail, the speed of splitting the funds, and mixing personal and business flows. Even if the services are real, the bank will likely ask for evidence of economic rationale and source of funds.

What is usually requested in such cases?

• a contract or a public offer describing the service and payment terms,
• invoices (faktury) or another document linking the payment to a specific service,
• proof of work performed, such as deliverables, reports, correspondence, repository access, acceptance acts, protocols,
• an explanation of the settlement scheme if there is an intermediary, meaning what service it is and how payouts are formed.

A minimal set that is worth keeping ready:

• a contract or offer,
• invoices (faktury),
• evidence of work performed, such as reports, correspondence, outputs.

How to reduce the risk of being blocked — a practical checklist

The steps below tend to produce the best results. It is not magic. It is a way to make your financial picture understandable for the bank.

1  Build a transparency folder

For individuals:

• sources of income, such as employment contract, self‑employment, dividends, rent,
• documents supporting large inflows, such as sale and purchase agreement, gift, inheritance.

For sole traders and companies:

• incorporation documents and ownership structure,
• proof of real activity, for example website or public profiles, portfolio, contacts, plus contracts and licences or permits where relevant,
• standard contracts with clients and suppliers,
• invoices (faktury), acceptance acts, and other evidence of performance.

2  Separate personal and business flows

This reduces the risk of transit behaviour:

• use a personal account for household spending,
• use a business account for revenue, purchases, payroll, and taxes.

If you are a sole trader and use one account, keep the structure clear:

• clear payment references,
• consistent patterns,
• links to contracts and invoices.

3  Keep your client data updated with the bank

Do not treat bank emails as spam. Banks must keep customer information current. ČNB explicitly points to regular KYC updates. That is why requests like “please update your business activity and expected turnover” have become normal in 2024–2025.

It makes sense to proactively update your profile after:

• a change of business activity,
• a sharp increase in turnover,
• new countries or types of counterparties,
• a new beneficial owner or investor.

4  Plan large transactions in advance

If you expect a large inflow, ask the bank in advance what documents it will need and prepare the package before the payment arrives. This is particularly useful for real‑estate sales, investments, loan repayments, or large dividend payments.

5  Respond to compliance the right way

Bank compliance is not customer support. It is risk control. Its job is to verify that a transaction is understandable, matches your profile, and does not breach AML rules. A calm, businesslike tone and the mindset “I am making your review easier” usually works best.

What the bank typically needs to see in your reply:

• a short explanation of the transaction purpose in one or two sentences,
• specifics on amounts and dates so the bank can match your story to the transaction,
• supporting documents such as contract or offer, invoice (faktura), proof of performance, and where relevant the chain of origin of funds.

Wordings that usually slow things down:

Phrases like “it’s my personal money” or “I don’t have to explain anything” rarely accelerate the process. For a bank, such answers look like unwillingness to explain the economic rationale, and the restriction can last longer.

What a good reply can look like in practice?

Short and specific: “Payment of 120,000 Kč from Company X, settlement under Contract No. … for development of module …, period …; invoice (faktura) issued on …”. Then attach the documents and provide a contact for quick follow‑up. If you use an intermediary or a non‑standard settlement model, mention it in one sentence and attach evidence.

Speed matters. Silence often looks like risk, so it is better to answer quickly and in one structured message rather than stretching the exchange over a week.

6  Use a clear payment reference (účel platby)

Czech banks pay close attention to the účel platby field, meaning the payment purpose or reference.

Tips:

• make sure the reference matches the contract and the invoice,
• avoid empty labels like “transfer” if they do not explain what the payment is for.

What to do if your bank account is blocked

Rule number one is not to guess. First, understand what exactly happened.

Step 1  Identify the type of restriction

Check:

• messages from the bank in internet banking and in email,
• whether there is a notice of enforcement (exekuce) or a court measure,
• whether one payment is stopped or the whole account is frozen.

Ask the bank directly:

• the reason for the restriction,
• which department is handling the case,
• which documents are required,
• whether there is a review timeline.

Scenario 1  Enforcement (exekuce) and account seizure

If this is enforcement, your tasks are the following:

• obtain documentary details, meaning who the creditor is and on what basis the claim is enforced,
• understand which funds are protected,
• consider arranging a protected account (chráněný účet) if you are an individual and the situation fits.

ČNB and the Ministry of Justice publish official instructions on chráněný účet and the confirmation procedure.

Scenario 2  AML review by the bank

Here the logic is different. The bank temporarily restricts operations until it is satisfied with the source of funds and the economic rationale of the transactions.

What to do?

• collect documents specifically for the transaction in question,
• describe the chain of origin of funds from the original source to the current account,
• show the link to your business activity or personal profile,
• reply in one structured message, meaning explanation, list of documents, contacts.

Keep in mind that the AML Act allows a bank to defer executing client instructions in certain situations. This means the bank may not be arguing with you, but simply following the procedure.

Scenario 3  The bank asks you to close the account

Sometimes the bank does not freeze the account indefinitely, but informs you that it is terminating the relationship. The reason may be the bank’s internal risk policy.

What to do?

• ask for written confirmation of deadlines and the procedure for withdrawing funds,
• transfer the remaining balance carefully to another account without creating new triggers,
• in parallel, prepare documents to open an account at another bank.

For businesses, it is useful to have a backup account in another banking group so that one refusal does not stop all payments.

Frequently asked questions

Can a company’s account restriction be lifted?

Yes, if the underlying reason is removed. In enforcement (exekuce), once the debt is paid or an arrangement is reached, the exekutor removes restrictions within the procedure. In an AML review, accounts are typically unblocked after sufficient documents are provided and compliance questions are closed. If the bank terminates the relationship, it may not restore service, but it must follow the withdrawal procedure.

Who has the right to block an account?

In practice, there are three groups:

• the bank under its internal rules and AML procedures,
• the exekutor and enforcement authorities within enforcement proceedings (exekuce),
• courts and law‑enforcement authorities within procedural measures.

Can you withdraw funds from a blocked account?

It depends on the reason. In enforcement (exekuce) there may be special regimes and protected amounts, which is why a protected account (chráněný účet) exists. In an AML review, withdrawals are usually limited until the review is finished or until the bank decides on the specific transaction.

How long does the review take?

It depends on two things:

• how quickly you provide documents,
• how complex the chain of origin of funds is.

The most common reason for delays is not a mean bank, but incomplete answers, missing documents, or contradictions.

Which documents are requested most often?

• contracts and invoices (faktury),
• statements from other accounts if needed to show the origin of funds,
• documents proving ownership and sale of assets,
• evidence of tax logic, for example that income will be declared,
• documents on company ownership structure and beneficial owners.

Conclusions and key points

• In the Czech Republic, account blocks are most often linked to enforcement (exekuce), decisions by authorities, or AML and KYC checks by the bank.
• The strongest prevention is transaction transparency and having source‑of‑funds documents ready.
• Do not ignore bank requests, and update your KYC data when your activity or turnover changes.
• Cryptoassets and large one‑off inflows require a prepared story and supporting evidence.
• If a block happens, identify the scenario first, enforcement (exekuce), AML review, court measures, or termination of the banking relationship.
• Fast, structured replies to compliance usually reduce review time.

For any questions related to managing business bank accounts in the Czech Republic, you can contact DoMyTax. We can help you prepare supporting documents, communicate with the bank and compliance teams, and reduce the risk of future restrictions.

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