On Wednesday, Britain's financial regulator urged financial firms to reassess their policies on account denials and closures, ensuring that vulnerable consumers and organizations like charities and pawnbrokers are not disadvantaged. In its latest report, the Financial Conduct Authority (FCA) acknowledged that banks, building societies, and payment firms are making efforts to assist customers in accessing accounts. The regulator also stated that it has not found any instances of accounts being closed due to politically motivated opinions expressed lawfully. However, the FCA has requested senior executives to sign declarations affirming their personal responsibility for ensuring compliance with regulations and their confidence in such compliance.
Last year, NatWest faced a crisis following a contentious dispute with former Brexit Party leader Nigel Farage, who had his accounts closed by the bank's private subsidiary, Coutts. This incident led to a political uproar and resulted in the resignation of the bank's CEO, Alison Rose, and Coutts' former head, Peter Flavel. The FCA also encouraged account providers to extend more support to individuals seeking bank accounts but currently unbanked, reminding them of their obligations to act accordingly. Organizations in sectors such as pawnbroking, charity, and adult entertainment have faced difficulties in accessing accounts, prompting the FCA to call for a clear, well-considered definition of reputational risk among firms.
"We've observed instances of excellent practice where account providers facilitate access to essential financial products, but there are also areas needing improvement," noted Sheldon Mills, the FCA's executive director for consumers and competition. "By highlighting both, we aim to foster more uniform outcomes, ensuring people are aware of suitable accounts available to them, enhancing support for the vulnerable, and preventing unjustified denials of access." (Reporting by Kirstin Ridley and Sinead Cruise, Editing by Louise Heavens)
