Banks blamed as charities miss millions

INTERNATIONAL charities miss out on millions of pounds in donations as counter-terrorism laws cause banks to shut their accounts, says a think-tank.

In a hard-hitting report, Demos warns vital help is not reaching war-torn regions such as Gaza and Syria because banks are nervous about huge fines.

Governments and regulators around the world fear charities are being used as fronts for terrorist groups. Banks, including HSBC and Standard Chartered, have been hit with fines in the US over allegations that their laxity meant they unwittingly processed transactions for brutal regimes, terrorists and gangs.

But Demos says banks’ zero tolerance of risk has gone too far as critical aid fails to reach those it is aimed at.

One unnamed nongovernmental organisation (NGO) said it had foregone £2m of donations in the last 12 months because of funds being blocked. HSBC was accused of being Islamophobic after it closed the accounts of Muslim groups.

Demos backs an internationally recognised ‘kitemark’ for NGOs which have been vetted.

A British Bankers’ Association spokesman said: ‘When banks are facing a billion dollar fine in the US, or being banned from doing business there, it is not surprising they are taking a zero tolerance approach to doing business with high-risk customers.’