UK regulator finds no evidence banks shut accounts based on political views

UK regulator finds no evidence banks shut accounts based on political views

The UK's financial regulator has found no evidence that banks have shut or denied accounts to customers based primarily on their political beliefs, according to a preliminary review launched in the wake of the debacle.

Despite growing worries that customers have been quietly discriminated against for their political views, the Financial Conduct Authority said initial findings showed either that the account was inactive or that they had concerns that the customer was involved in financial crime.

'' further work is needed for us to be sure,'' said the chief executive of FCA, Nikhil Rathi.

It will also involve verifying the initial data gathered from 34 banks, building societies and payment firms, covering the year to June, including accounts closed because the customers posed a'reputational risk'.

The majority of accounts were denied on the basis of reputational risk, it said, rather than banks or building societies.

Although the review was launched in response to Farage's fight with NatWest's private bank Coutts, it is understandable that the data does not cover his case, given that the bank never followed through with the closure. In July, Farage said that Coutts' new boss had offered to retain his account.

The FCA is also investigating whether politicians - including MPs, peers, leaders of UK political parties and senior military officers - are unfairly denied banking services. Banks must devote more attention to PEP accounts and transactions, as they are at a higher risk of bribery or corruption.

Both problems gained traction after Farage launched a campaign against Coutts, which had planned to shut his accounts.

The former Ukip leader originally claimed that the decision to close his accounts had been linked to his status as a PEP. Although it was later revealed to have been linked to commercial considerations as well as alleged reputational risks related to his political views, the saga was fuelled by the debate about the use of discretion relating to PEPs.

The scandal eventually erupted into a freedom of speech row, and snowballed when it emerged that Alison Rose, the chief executive of Coutts' owner NatWest, had discussed the matter with a BBC journalist.

In the end of July, Rose was eventually resigned and the chief executive of Coutts, Peter Flavel, was asked to leave the company days later over the mishandling of the situation.

NatWest has hired lawyers for a wide-ranging investigation, the company announced at the end of October.

The freedom of speech is a fundamental human right, said Andrew Griffith, the finance secretary to the treasury. No ifs, no buts - everyone must be able to express their lawful opinions without fear of losing the vital access to a bank account.

Banks have been forced to explain and delay any decision to close an account to protect freedom of expression, meaning customers have a 90-day notice period and a clear explanation for any account closure.