NatWest customers dumped and left unable to pay bills
Pushed out Britons with foreign links are having their accounts closed as anti-terrorism and money laundering rules bite. Rupert reports
Is NatWest secretly conducting a purge of customers who have links to countries it doesn’t like the look of ?
A 26-year-old Londoner saving up to buy his first home and a 54-year-old woman on disability benefits are the latest people to have their NatWest bank accounts shut down with no explanation.
The 26-year-old, Joseph (he didn’t want us to use his full name), says he has been “painted as a criminal” by the bank, adding that in his view this could amount to “an act of discrimination because of my ethnic origin”.
Meanwhile, 54-year-old Rossana (she also only wanted us to use her first name) is equally angry and bemused. She has been with NatWest – part of 62% taxpayerowned Royal Bank of Scotland – for more than three decades, but now it is dumping her and won’t say why.
So what have Joseph and Rossana done to merit being treated like pariahs?
It’s worth noting that while Joseph was born and raised in the UK – he describes himself as black British – his parents are from Nigeria.
Meanwhile, Rossana was born in Egypt, though she has been in the UK since 1977, when she was 13. She also describes herself as British – “I was naturalised a long time ago.”
Their experiences come just months after Guardian Money reported on the case of Samuel, a father of two young children who was born in Nigeria and moved to the UK more than a decade ago. NatWest wrote to him in January to say it was shutting his accounts and he would have to take his business elsewhere. And in 2015, Money reported how an economics professor who was born in Iran but had lived in the UK for decades had had his NatWest accounts shut down.
There have been others, too: last month the Sunday Times featured the case of a 49-year-old Londoner who had her account shut down by NatWest without explanation. The article said the woman’s partner was born in Libya and lives abroad.
With the bank refusing to say anything about any of these cases, it’s hard to avoid concluding that NatWest, and some other banks, are dumping customers they view as having links to countries about which they have concerns. This controversial practice is known in the industry as “de-risking”.
Joseph says the way he has been treated is “unethical and unacceptable,” and adds: “I have no criminal records, I’ve not acted unlawfully and I’ve done nothing wrong.” To add insult to injury, NatWest effectively froze the money in his accounts while it carried out “checks”, which Joseph says left him unable to pay bills and meet other costs.
As is often the case, the first he knew there was a problem was when his debit card was declined in a shop. A few days later a letter arrived stating that “having carried out a review of your banking arrangement with us, we have made the decision that we can no longer offer you banking [services]”. It gave him 14 days’ notice that it was closing his accounts. It added that access to his accounts had now been stopped, meaning his cards, direct debits and standing orders had been cancelled.
NatWest told him the money in his accounts could be transferred to another account once all the necessary checks had been completed – though these checks would take 28 to 60 days.
Joseph graduated with a firstclass university degree and works at an investment advisory company. He told us he can’t think of any reason why the bank is so keen to be shot of him. He has been with NatWest for eight years and says all the money in his accounts – several thousand pounds spread across a current account, a help-to-buy Isa and a savings account – had been earned “working for legitimate companies – nothing illegal”.
In a letter to the Financial Ombudsman Service (FOS), Joseph said: “I have been unable to pay my bills, expenses, direct debits, not to mention maintenance costs (food shopping, travel and so on).”
In 2016, City regulator the Financial Conduct Authority (FCA) said it had become aware that banks were withdrawing banking facilities from customers – or failing to offer them in the first place – in greater numbers than before. It said there was a perception that this was driven by banks’ concerns about the money laundering and terrorist financing risks posed by certain types of customer.
It follows that because countries deemed risky in terms of money laundering and financing terrorism tend to be Asian and African, people from, or with links to, these regions may be particularly vulnerable.
In 2016, the financial ombudsman was dealing with 20 to 30 complaints a week about bank account closures. Now it is running at about 50 a week.
The first Rossana knew of any issue was when she tried to log into the NatWest app but couldn’t get through. She went to a branch but the staff couldn’t or wouldn’t enlighten her – though she says the manager was holding a piece of paper that said “Info suppressed”.
The NatWest account receives her disability living allowance payments and had a little over £2,900 in it. Her main bank account is with HSBC and she has had no problems with that.
A few days later she was able to access her NatWest account, so she quickly withdrew most of her money. She has now received a letter from the bank saying she will need to make alternative banking arrangements within 60 days because “we will no longer provide these facilities for you”. It adds that “our decision is final and we are not prepared to enter into any discussion in relation to it”.
Rossana says she has no idea why NatWest has taken this action, adding that there had been nothing that could be interpreted as “suspicious activity”. She lives in London and has two grownup sons.
NatWest declined to comment on the two cases – it would only say: “We don’t take decisions like this lightly and will never close a customer’s account without good reason.” Asked about allegations of discrimination, the bank declined to provide an on-the-record quote.
‘I have no criminal records, I’ve not acted unlawfully and I’ve done nothing wrong’ Joseph NatWest customer