The UK Treasury has called on the Financial Conduct Authority to “urgently” investigate the scale of debanking after the outcry that followed the closure of Nigel Farage’s account with Coutts.
(Bloomberg) — The UK Treasury has called on the Financial Conduct Authority to “urgently” investigate the scale of debanking after the outcry that followed the closure of Nigel Farage’s account with Coutts.
Chancellor Jeremy Hunt has written to the regulator asking for details on the characteristics of people who have been terminated or suspended by their banks, or denied accounts. He also sought answers on the reasons behind the decisions and what on what monitoring or enforcement the FCA was undertaking.
“I request that this evidence and any findings are shared with the Treasury without delay,” he wrote to FCA Chief Executive Officer Nikhil Rathi.
Rathi said in response that the regulator was already planning a data exercise, and will ask the biggest banks and building societies to provide the number of account closures and the reasons behind them over the coming month. The regulator will also ask for the number of complaints about terminations and their outcomes, Rathi said in a letter in response.
“In recent years, we have seen a significant increase in the number of bank accounts being closed. This may reflect increased monitoring by firms to comply with their financial crime obligations,” Rathi wrote. “It is less clear the extent to which banks may be terminating accounts for other reasons, which may be unjustified and which, in some instances, may contravene the law.”
Farage revealed NatWest Group Plc unit Coutts was closing his account about a month ago, sparking a public fight over the decision that has prompted the resignation of the chief executives of NatWest and Coutts. He has called for the whole board of NatWest to quit and vowed to campaign for others who have been “debanked” on questionable grounds.
More stories like this are available on bloomberg.com
©2023 Bloomberg L.P.